Chevron Corporation - History and Mergers

History and Mergers

Chevron traces its roots to an oil discovery in Pico Canyon (now the Pico Canyon Oilfield) north of Los Angeles. The discovery led to the formation, in 1879, of the Pacific Coast Oil Company (also known as "Coast Oil"), the oldest predecessor of Chevron Corporation.

In 1895, Coast Oil initiated its enduring marine history when it launched California's first steel tanker, the George Loomis, which could ship 6,500 barrels of crude between Ventura and San Francisco. Coast Oil was acquired in 1900 by the Standard Oil Co. (Iowa), a subsidiary of John D. Rockefeller's Standard Oil company. In 1906, Coast Oil was reincorporated as Standard Oil Co. (California).

Another side of the genealogical chart points to the founding of The Texas Fuel Company in 1901, a modest enterprise that started out in three rooms of a corrugated iron building in Beaumont, Texas, United States. This company was known as the Texas Company and later Texaco.

In 1911, Standard Oil Co. (California) was severed from its parent corporation, Standard Oil, as a result of the federal government's successful lawsuit against Standard Oil under the Sherman Antitrust Act. It went on to become part of the "Seven Sisters", which dominated the world oil industry in the early 20th century. In 1926, the company shed its parenthetical name by changing to Standard Oil Co. of California, or SoCal. As a former subsidiary of Standard Oil, SoCal had traditionally used the brand name "Standard", but in the 1930s, it began using "Chevron" on some of its retail products, which eventually would later become its dominant brand name.

In 1933, Saudi Arabia granted SoCal a concession to find oil, which led to the discovery of oil in 1938. In 1948, SoCal discovered the world's largest oil field (Ghawar) in Saudi Arabia. SoCal's subsidiary, California-Arabian Standard Oil Company, grew over the years and became the Arabian American Oil Company (ARAMCO) in 1944. In 1973, the Saudi government began buying into ARAMCO. By 1980, the company was entirely owned by the Saudis, and in 1988, its name was changed to Saudi Arabian Oil Company (Saudi Aramco).

Standard Oil of California and Gulf Oil merged in 1984, which was the largest merger in history at that time. To comply with U.S. antitrust law, SoCal divested many of Gulf's operating subsidiaries, and sold some Gulf stations and a refinery in the eastern United States. The same year, SoCal also took the opportunity to change its legal name to Chevron Corporation, since it had already been using the well-known "Chevron" retail brand name for decades.

In January 1996, NGC (formerly NYSE: NGL) and Chevron announced plans to merge Chevron's natural gas and natural gas liquids business with NGC. On May 23, 1996, the companies reached an agreement in principle to merge their business. Under the agreement, Chevron transferred its natural gas gathering, operating and marketing operation to NGC in exchange for a roughly 25 percent equity stake in NGC. On August 30, shareholders approved the deal creating North America's largest natural gas and gas liquids wholesaler. In 1998, NGC Corporation was renamed Dynegy (NYSE: DYN).

In a merger completed February 1, 2000, Illinova Corp. (formerly NYSE: ILN) became a wholly owned subsidiary of Dynegy Inc., in which Chevron also took a 28% stake. However, Chevron in May 2007 sold its roughly 12 percent (at the time) Class A common stock in the company for approximately $985 million, resulting in a gain of $680 million.

On October 15, 2000, Chevron announced it would acquire Texaco (NYSE: TX), creating the second-largest oil company in the United States and the world's fourth-largest publicly traded oil company with a combined market value of approximately $95 billion. On October 9, 2001, the shareholders of Chevron and Texaco voted to approve the merger, creating ChevronTexaco in a deal valued at $45 billion.

On May 9, 2005, ChevronTexaco announced it would drop the Texaco moniker and return to the Chevron name. Texaco remains as a brand under the Chevron Corporation.

On April 4, 2005, Chevron announced it planned to purchase Unocal Corporation (NYSE: UCL) for $18.4 billion, increasing the company's petroleum and natural gas reserves by about 15 percent. On August 10, 2005, Unocal Corporation shareholders approved Chevron's acquisition of the company in a deal valued at $18 billion. Because of Unocal's large South East Asian geothermal operations, Chevron became the world's largest producer of geothermal energy.

In July 2010, Chevron ended retail operations in the Mid-Atlantic United States, removing the Chevron and Texaco names from 1,100 stations in Delaware, Indiana, Kentucky, North Carolina, New Jersey, Maryland, Ohio, Pennsylvania, South Carolina, Virginia, West Virginia, Washington, D.C., and parts of Tennessee.

On November 9, 2010, Chevron announced it would acquire Pennsylvania based Atlas Energy Inc. (NASDAQ: ATLS) for $3.2 billion in cash and an additional $1.1 billion in existing debt owed by Atlas. On February 18, 2011, the shareholders of Atlas energy voted to approve the merger in a deal valued at $4.3 billion.