On October 6, 2026, Chevron Corporation announced a restructuring of its midstream operations involving the divestiture of assets in the Bakken and DJ Basins. The company has entered into definitive agreements with Hess Midstream LP to transfer its ownership interests and general partner position in Hess Midstream, as well as its crude oil midstream assets in the DJ Basin.
In exchange for these assets and approximately $200 million in cash consideration, Chevron will receive extended and improved commercial terms for its Bakken midstream operations. The company anticipates that these revised contracts will reduce its Bakken unit midstream costs by about 50%.
Chevron’s preliminary accounting assessment indicates that upon closing of the transaction, it will fully deconsolidate Hess Midstream. The company expects to recognize a one-time after-tax loss of approximately $3 to $4 billion, which it plans to treat as a special item. This loss is attributed to the inability to recognize future Bakken midstream cost savings as an asset.
Despite the immediate accounting loss, Chevron expects the transaction to be accretive to its return on capital employed by 0.5% on an absolute basis. The company projects that the lower cost structure and improved earnings will generate long-term future economic value. The transaction has been approved by the Conflicts Committee of Hess Midstream’s Board of Directors and is subject to customary closing conditions and regulatory approvals. It is expected to close by the end of 2026.
