Hess Midstream to Acquire DJ Basin Assets and Become Independent from Chevron

Hess Midstream LP announced a definitive agreement on October 6, 2026, to acquire assets and ownership interests from Chevron Corporation and its subsidiaries. The transaction is expected to close by the end of 2026, subject to regulatory approvals and other customary closing conditions.

Under the agreement, Hess Midstream will acquire Chevron’s crude oil and natural gas gathering and storage assets located primarily in Weld County, Colorado. These assets include approximately 400,000 barrels per day of oil gathering capacity, 300 million cubic feet per day of gas gathering capacity, and 420,000 barrels of storage capacity. The acquisition also includes a 20% interest in the Saddlehorn long-haul pipeline, a 600-mile, 300,000 barrels per day FERC-regulated crude pipeline connecting the DJ Basin to the Cushing oil storage hub in Oklahoma.

In addition to the physical assets, Hess Midstream will acquire Chevron’s consolidated ownership interests in the partnership. This includes 449,000 Class A shares and 77,827,485 Class B units of Hess Midstream Operations LP, which will be canceled by Hess Midstream. Hess Midstream will also acquire the general partner interests in Hess Midstream GP LP and Hess Midstream GP LLC. As a result of these contributions, Hess Midstream’s outstanding shares are expected to decrease by nearly 40%, and Chevron will no longer hold a consolidated interest in the company.

As consideration for the assets and interests, Hess Midstream will pay Chevron $200 million in cash. The transaction also includes the transfer of a contract liability associated with Bakken commercial agreements, which will be recognized as revenue through 2045.

In connection with the closing, Hess Midstream and Chevron will amend their existing Bakken commercial agreements. The agreements will extend through 2045, with tariff rates adjusted annually based on the Consumer Price Index (CPI-U) for the most recently available 12-month period, subject to a 3% cap. The agreements will also include a minimum revenue commitment (MRC) equal to 80% of expected revenues attributable to Chevron through 2033.

Hess Midstream has provided preliminary financial guidance for 2027, assuming the transaction closes by year-end 2026. The company expects Adjusted EBITDA of approximately $850 million to $950 million, Gross Adjusted EBITDA Margin of approximately 75%, and Adjusted Free Cash Flow of approximately $525 million to $625 million. The company expects to maintain its quarterly distributions at fourth quarter 2026 levels, fully funded by Adjusted Free Cash Flow.