Chevron has agreed to divest its ownership interests in Hess Midstream and its crude oil midstream assets in the DJ Basin as the U.S. supermajor looks to slash transportation and processing costs in the Bakken.

Under a series of definitive agreements with Hess Midstream, Chevron will transfer its Hess Midstream ownership interests and general partner position, along with its DJ Basin crude midstream assets. In return, Chevron will receive $200 million in cash and improved and extended commercial terms for its Bakken operations.

The new agreements are expected to reduce Chevron’s unit midstream costs in the Bakken by approximately 50%, improving earnings and returns from the shale basin.

Chevron expects the transaction to boost return on capital employed by around 0.5 percentage points. The company will also deconsolidate approximately $3.7 billion of Hess Midstream debt from its balance sheet.

However, Chevron expects to recognize a one-time after-tax loss of approximately $3 billion to $4 billion when the transaction closes because accounting rules do not allow it to recognize the value of future Bakken midstream cost savings as an asset.

The restructuring comes after Chevron completed its acquisition of Hess Corporation in July 2025, significantly expanding its upstream portfolio. Chevron said earlier this year that its combined production from the Bakken and DJ Basin had reached roughly 600,000 barrels of oil equivalent per day.

The deal also continues Chevron’s broader portfolio rationalization following the Hess acquisition. In 2025, the company sold interests in several international and U.S. midstream assets while simultaneously cutting structural costs.

Chevron said it plans to sustain Bakken production through technology and operational improvements, while the restructuring will allow Hess Midstream to operate as an independent company.

The transaction remains subject to regulatory approvals and customary closing conditions and is expected to close by the end of 2026.

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