Chevron Raises Exploration Spending By 50%
After years of focusing on growing exploration and production in the U.S. Gulf of Mexico and the Permian shale basin, U.S. oil and gas supermajor Chevron returns to high-impact frontier exploration as it seeks to renew its portfolio with diverse opportunities globally.
Exploration in South America, Africa, and the Eastern Mediterranean is now a key focus of Chevron's upstream business, which the company looks to turn around by adding reserves and production growth opportunities in Guyana, Angola, Namibia, Nigeria, Guinea-Bissau, Equatorial Guinea, Egypt, and the Eastern Mediterranean.
The U.S. supermajor is boosting its exploration spending in its revived exploration program, led by vice president of exploration, Kevin McLachlan, who took over the exploration arm last year. Chevron recruited McLachlan from France's TotalEnergies, where earlier this decade the executive oversaw work at one of the biggest and most promising recent discoveries in a frontier area—the Venus discovery in Namibia's offshore Orange Basin.
Chevron has been aggressively adding exploration acreage over the past two years. This strategy to turn to frontier exploration has been vindicated by this year's geopolitical and energy market turmoil.
The Iran war and the disruption of oil and gas flows in the Strait of Hormuz laid bare the vulnerability of relying on a single region for large supplies while global oil demand is set to grow in the coming years.
Related: Japan to Overtake China As World's Top LNG Importer This Year
Supermajors need to add to their reserves base to offset declines at existing assets over time. At the same time, "the Middle East conflict has highlighted the concentration risk involved in focusing on geopolitically unstable regions," analysts at Wood Mackenzie said earlier this year.
"The need for portfolio renewal and diversification is raising upstream firms' appetite for exploration risk," they added, noting that oil and gas companies are taking on more exposure and positioning earlier in their respective exploration targets.
Exploration budgets have room to rise, especially in light of the windfall profits companies are raking in this year amid the spike in oil and gas prices following the Iran war.
Chevron, specifically, is raising its exploration budget this year by 50% compared to last year, McLachlan told the Financial Times in an interview in September.
This year, Chevron's spending on exploration could top $1.5 billion, up from just below $1 billion in 2025.
"We needed to increase the spend because we just didn't have the exposure," McLachlan told FT.
"So we've increased our spend on seismic data, which is the enabling piece of how to generate prospects, without which you can't generate ideas."
Two years ago, Chevron was drilling about 10 exploration wells per year. Its program for 2027 includes drilling 20 exploration wells and possibly up to six appraisal wells, the executive said.
In a more recent interview with The Wall Street Journal this month, McLachlan said that about 50% of the exploration budget is now being invested in undeveloped frontier basins, up from 20% a few years ago.
In just a year, Chevron has significantly raised exploration acreage and has announced discoveries in West Africa.
In August last year, Chevron's CEO Mike Wirth told analysts at the Q2 2025 earnings call , "I'm not happy with the results out of exploration over the last few years, but I want to acknowledge our exploration team has been operating in a pretty narrow range."
At this year's Q2 earnings call, Wirth said that Chevron has now built "the largest and highest quality opportunity set that we've had in years, probably in my time in this role."
Chevron increased exploration acreage by 35% over the past year, Wirth said, adding that "We haven't had this deep of an inventory of opportunity."
The company has announced in recent months discoveries in Nigeria and Angola , and plans to drill the Nabba-1X exploration well in Namibia by the end of the year, as part of a high-impact, multi-well exploration program across the region.
Commenting on the Angola discovery and the broader exploration campaign,
McLachlan said , "Every successful well adds information, confidence and potential pathways for future growth."
By Tsvetana Paraskova for Oilprice.com
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