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Chevron is buying Anadarko Petroleum for $33 billion, energizing its oil and gas drilling capabilities in Texas and the Gulf of Mexico while vaulting itself into a new league.
The combined company will remain far behind Exxon Mobil Corp. and Royal Dutch Shell Plc. in market capitalization, but Chevron will jump from being the world’s fourth biggest energy producer, to second, according to Wood Mackenzie.
“Chevron now joins the ranks of the UltraMajors - and the big three becomes the big four,” wrote Roy Martin, senior analyst at Wood Mackenzie, referring to Exxon, Shell and BP.
The cash-and-stock deal announced Friday comes as U.S. crude prices have shot up 40% this year.
Chevron gets access to Anadarko’s liquid natural gas operations in Mozambique and it would control a 75-mile-wide corridor across the Delaware Basin, a region bountiful with natural gas.
Oil prices have been on the rise as OPEC members cut production.
OPEC said this week that its output had been slashed by more than a half million barrels a day last month to just over 30 million barrels, a level not seen since early 2015.
That is largely being driven by the energy powerhouse Saudi Arabia, which last month removed another 324,000 barrels of oil per day from the market.
U.S. crude was selling for nearly $65 per barrel Friday. But there are signals that global economic growth is slowing.
The acquisition of Anadarko could give Chevron a little more breathing room when crude prices do fall.
With savings the companies plan to book and rising cash flow, Chevron said Friday that it will bump up annual stock buybacks to $5 billion, from $4 billion a year, once the transaction is complete.
Chevron plans to divest $15 billion to $20 billion in assets between 2020 and 2022, with proceeds used to lower debt and to return additional cash to shareholders, the company said.
“This transaction builds strength on strength for Chevron,” said Chairman and CEO Michael Wirth. “The combination of Anadarko’s premier, high-quality assets with our advantaged portfolio strengthens our leading position in the Permian, builds on our deepwater Gulf of Mexico capabilities and will grow our LNG business.”
Anadarko shareholders will receive 0.3869 shares of Chevron and $16.25 in cash for each share they own, or $65 per share. Chevron will issue about 200 million shares and pay approximately $8 billion in cash. It will also assume about $15 billion in debt.
Chevron Corp. will keep its headquarters in San Ramon, California. Anadarko Petroleum Corp. is based in The Woodlands, Texas.
The deal is expected to close in the second half of the year. It still needs approval from shareholders of Anadarko Petroleum Corp. and regulators.
Shares of Anadarko jumped 33% Friday, while Chevron’s stock fell 5%.

BOSTON — It was the death heard ‘round the running world.
In July 1984, acclaimed author and running guru Jim Fixx died of a heart attack while trotting along a country road in Vermont. Overnight, a nascent global movement of asphalt athletes got a gut check: Just because you run marathons doesn’t mean you’re safe from heart problems.
Fast-forward 35 years, and Boston Marathon race director Dave McGillivray is amplifying that message for marathoners, especially those who have coronary artery disease or a family history of it.
“Being fit and being healthy aren’t the same things,” said McGillivray.
He should know. Six months ago, the lifelong competitor underwent open-heart, triple bypass surgery after suffering chest pain and shortness of breath while running.
As marathons, ultramarathons, megamile trail races and swim-bike-run triathlons continue to explode in popularity, doctors are re-prescribing some longstanding advice: Get a checkup first and talk with your primary care physician or cardiologist about the risks and benefits before hitting the road.
For McGillivray, 64, the writing was on his artery walls. Both of his grandfathers died of heart attacks; his father had multiple bypasses; his siblings have had heart surgery; and a brother recently suffered a stroke.
Neither McGillivray’s marathon personal best of 2 hours, 29 minutes, 58 seconds, nor his decades of involvement in the sport could protect him.
“I honestly thought that through exercise, cholesterol-lowering medicine, good sleep and the right diet, I’d be fine,” he said. “But you can’t run away from your genetics.”
Aerobic exercise such as running, brisk walking, cycling and swimming is known to reduce the risk of heart disease, high blood pressure, stroke and certain types of cancer, and it’s been a key way to fight obesity, Type 2 diabetes, osteoporosis and more. Studies have shown those who exercise regularly are more likely to survive a heart attack and recover more quickly than couch potatoes.
But new research is providing a more nuanced look at “extreme exercise” and the pros and cons of running long.
In a study published in December in Circulation, the journal of the American Heart Association, researchers in Spain found signs suggesting that full marathons like Boston may strain the heart. They measured substances that can signal stress and found higher levels in runners who covered the classic 26.2-mile marathon distance compared with those who raced shorter distances such as a half-marathon or 10K.
Only about one in 50,000 marathoners suffers cardiac arrest, the researchers said, but a high proportion of all exercise-induced cardiac events occur during marathons — especially in men ages 35 and older. The Boston Marathon and other major races place defibrillators along the course.
“We typically assume that marathon runners are healthy individuals, without risk factors that might predispose them to a cardiac event during or after a race,” writes Dr. Juan Del Coso, the study’s lead investigator, who runs the exercise physiology lab at Madrid’s Camilo José Cela University. Running shorter distances, he said, might reduce the strain, especially in runners who haven’t trained appropriately.
Dr. Kevin Harris, a cardiologist at the Minneapolis Heart Institute at Abbott Northwestern Hospital, said he had a patient preparing for the Twin Cities Marathon who struggled to exceed 10 miles (16 kilometers) in training. The man’s family doctor insisted he get a stress test, and he wound up needing double bypass surgery to detour around dangerous blockages in his arteries.
“Running is good, and we want people to be active. But your running doesn’t make you invincible,” Harris said. “The bottom line is that individuals with a family history — especially men who are older than 40 and those people who have symptoms they’re concerned about — should have an informed decision with their health care provider before they run a marathon.”
That family history is crucial.
Fixx, whose 1977 best- seller “The Complete Book of Running” helped ignite America’s running boom, was 52 when he collapsed and died. An autopsy showed he had blockages in two of his heart arteries. He had a mix of risk factors. His father died at 43 of a heart attack, and although Fixx quit smoking, changed his eating habits and dropped 60 pounds, it turned out he couldn’t outrun those risks.
Facebook COO Sheryl Sandberg’s late husband, tech entrepreneur Dave Goldberg, was 47 when he died while the couple was vacationing in Mexico in 2015. Goldberg had been running on a treadmill when he fell, and an autopsy revealed he had undiagnosed heart disease.
Former U.S. House Speaker Paul Ryan, who is 49, has said his own strong family history of heart disease is what motivates him to work out regularly and watch his diet. His father, grandfather and great-grandfather all died of heart attacks in their 50s.
“If you’re going to take on strenuous exercise later in life, and especially if you have active heart disease, it’s clearly in your interest to be tested and make sure you can handle it,” said Dr. William Roberts, a fellow and past president of the American College of Sports Medicine.
McGillivray said his doctor has cleared him for Monday’s 123rd running of the Boston Marathon, which he’ll run at night after the iconic race he supervises is in the books. It will be his 47th consecutive Boston, and this time, he’s trying to raise $100,000 for a foundation established in memory of a little boy who died of cardiomyopathy — an enlarging and thickening of the heart muscle.
“Heartbreak Hill will have special meaning this year,” McGillivray said.
“My new mission is to create awareness: If you feel something, do something,” he said. “You have to act. You might not get a second chance.”

The ARC of St. Mary’s recycling program is facing major changes.
Kristal Hebert, executive director, told the St. Mary Parish Council Wednesday that, “It’s been costing us money for quite some time now…plastic vendors are no longer accepting it to recycle. I don’t even have room to put it. People are bringing it to us and were’ just having to throw it away.”
She said newspaper recycling has dropped drastically, and from here on, only cardboard and aluminum cans will be handled by the workers.
“It’s costing me triple to process the recyclables than what we make,” Hebert said. “I am going to ask the council and the cities to contribute to the operation. If we can’t get help, I’ll have to shut that whole program down.”
There are 23 individuals with intellectual and/or developmental disabilities employed by Arc of St. Mary: seven janitorial, four in the thrift store and 12 in recycling.
She said the budget will be $16,000 short in the next fiscal year.
“It’s sad and unfortunate, but we just can’t do it,” Hebert said. “We’re one of the few ARCs left that actually do recycling. Some just do cardboard and cans because it’s easier and you can make money. Those who do plastic have substantial contracts from the parish, and acres and acres of land to store it.”
Hebert invited the council and public to a recycling and family day April 24, beginning at 11:30 a.m. “I’m always bragging about how it’s different when you’re at the center,” she said. “If you come and get the feel for it and see how it is, how important it is to these people who go to work their every day.”
All employees will still have jobs, she stressed.
Chief Administrative Officer Henry “Bo” LaGrange said there would be an outreach to the five municipalities regarding continued recyclables collection, and possibly share in assisting in the shortfall of revenues.