Chevron has made clear to the Iraqi Ministry of Oil that it will only proceed with the takeover of Lukoil’s stake in the West Qurna 2 field if Baghdad agrees to more favorable fiscal and operational conditions. According to three industry sources, Chevron is seeking an adjustment to the cost-recovery mechanism that would allow it to retain a larger share of incremental barrel revenues, and is pressing for a reduction in the project’s royalty rate from 12.5% to 10%. West Qurna 2 currently produces about 500,000 barrels per day, making it one of Iraq’s largest fields, and Chevron’s proposed terms aim to boost its internal rate of return by up to 2 percentage points over the life of the asset. The U.S. major has also requested guarantees on accelerated contract approval timelines and an extension of the concession period by five years to support a planned $10 billion investment in enhanced oil recovery technologies and infrastructure upgrades over the next decade.

Chevron has signed a memorandum of understanding with Libya’s National Oil Corporation to jointly assess and develop exploration opportunities in the Sirte Basin and offshore blocks in the Mediterranean. This marks Chevron’s re-entry into Libya after an absence of more than 12 years, following the cessation of hostilities and the stabilization of key export terminals. Under the MoU, both parties will conduct seismic surveys covering approximately 6,000 square kilometers during the first 18 months, with the aim of identifying prospects capable of adding at least 200 million barrels of recoverable oil equivalent. Chevron has pledged to fund 100% of the initial two-year work program, estimated at $150 million, and will hold a 60% working interest in any production-sharing agreements that may follow successful drilling results.

As Chevron prepares to report fourth-quarter results on January 30, institutional investors have been adjusting their stakes significantly. In the most recent quarter, Belpointe Asset Management increased its Chevron holdings by 28.9%, adding 7,102 shares to reach 31,653 shares valued at approximately $4.9 million. Meanwhile, Norges Bank established a new position worth $2.7 billion during the second quarter, and Berkshire Hathaway raised its stake to 122 million shares following an additional purchase of 3.45 million shares. Analysts on the sell side currently expect Chevron to generate full-year earnings per share of around 10.8, with consensus revenue estimates near $240 billion for 2023. With a dividend yield hovering around 4%, many fund managers are positioning ahead of potential dividend increases tied to free cash flow growth projections of 10% annually over the next five years.