Chevron Signs Extended Gas Supply Agreement With Horizon Power

Chevron Signs Major Gas Supply Deal with Horizon Power

Chevron Corporation, a global leader in the energy sector, has finalized a significant agreement to deliver around 14 petajoules of natural gas over a five-year period to Horizon Power, the government-owned utility that provides electricity to remote and regional communities throughout Western Australia. This partnership underscores Chevron’s dedication to supporting local energy needs and bolstering the reliability and security of the state’s power supply.

Primary Gas Sources: Gorgon, Wheatstone, and North West Shelf

The natural gas supplied to Horizon Power will be sourced from Chevron’s substantial interests in three major Western Australian projects: Gorgon, Wheatstone, and the North West Shelf. Chevron operates both the Gorgon and Wheatstone ventures, while Woodside Energy Group Ltd oversees the North West Shelf. Gas deliveries under this new arrangement are set to begin in 2027, ensuring a consistent energy stream for regional electricity generation.

Balaji Krishnamurthy, President of Chevron Australia, highlighted that this agreement demonstrates Chevron’s ongoing support for the domestic gas sector. Natural gas remains a vital component in Western Australia’s energy portfolio, offering dependable backup to renewable sources during periods of fluctuating output.

The Importance of Gas in Western Australia’s Energy Landscape

Natural gas serves as a versatile energy solution, capable of providing steady base-load power and acting as a safeguard when renewable generation is affected by weather. Chevron’s extensive gas supply agreements make it the leading provider of gas for power generation in the region. The Gorgon and Wheatstone projects alone account for over 40% of Western Australia’s gas supply, highlighting Chevron’s pivotal role in maintaining energy stability.

Gorgon Project: Capacity and Future Growth

Located on Barrow Island, the Gorgon project is a flagship asset for Chevron in Australia. The facility includes a domestic gas plant with a processing capacity of 300 terajoules per day and three LNG trains capable of producing a combined 15.6 million metric tons of liquefied natural gas annually. Gas is sourced from the Gorgon and Jansz-Io offshore fields, utilizing advanced subsea technology for extraction and processing.

In December 2025, Chevron approved a $2.09 billion investment for the Gorgon Stage 3 expansion, which will develop the Geryon and Eurytion fields. This project will integrate these new fields into the existing infrastructure, further increasing production and reinforcing Chevron’s commitment to supplying domestic gas.

Wheatstone Project: Domestic and LNG Output

Situated on the Pilbara coast, the Wheatstone facility supplies up to 200 terajoules per day of gas for local use and operates two LNG trains with a total annual capacity of 8.9 million metric tons. The plant processes gas from several offshore fields, including Brunello, Iago, Julimar, and Wheatstone. An asset exchange with Woodside in 2024 is expected to boost Chevron’s ownership in Wheatstone, enhancing its influence over this critical project and its contributions to domestic energy supply.

North West Shelf: Essential Gas Processing Hub

Managed by Woodside, the North West Shelf project features two domestic gas trains and four LNG trains with a combined output of 14.3 million metric tons per year. Gas is drawn from offshore fields such as Angel, Goodwyn, North Rankin, and Perseus. As part of the asset swap with Woodside, Chevron plans to exit the North West Shelf by late 2026, allowing it to concentrate on Gorgon and Wheatstone operations.

Chevron’s Ongoing Commitment to Reliable Energy

The agreement with Horizon Power reflects Chevron’s strategic focus on ensuring a stable and sustainable gas supply for Australia’s domestic market. By expanding its project portfolio and investing in infrastructure like Gorgon Stage 3, Chevron is strengthening its leadership role in Western Australia’s energy transition.

Chevron’s long-term supply contracts and operational excellence across major projects help secure the state’s energy future, supporting the integration of renewables into the grid. Natural gas remains a crucial, adaptable complement to renewable energy, guaranteeing continuous electricity for businesses and communities throughout the region.

Future Prospects for Western Australia’s Gas Sector

With the Horizon Power contract set to start in 2027 and ongoing developments at Gorgon and Wheatstone, Chevron is well-positioned to reinforce Western Australia’s energy infrastructure. The company’s emphasis on high-capacity LNG and domestic gas projects ensures a reliable energy supply, economic advancement, and improved energy security for the state.

Chevron’s forward-thinking approach, combined with advanced subsea and onshore processing technologies, cements its status as a leader in the regional gas industry. By aligning production with local demand, Chevron is helping to maintain a dependable energy mix that supports both industrial growth and community needs for years to come.

Chevron’s Zacks Rank and Notable Alternatives

Currently, Chevron (CVX) holds a Zacks Rank #3 (Hold).

For investors interested in the energy sector, several higher-ranked stocks include TechnipFMC (FTI), which has a Zacks Rank #1 (Strong Buy), as well as USA Compression Partners (USAC) and Nabors Industries (NBR), both carrying a Zacks Rank #2 (Buy).

• TechnipFMC is valued at $25.21 billion and delivers global energy technology solutions, specializing in subsea, surface, and both offshore and onshore project services for the oil and gas industry. The company is known for its integrated engineering, procurement, construction, and installation expertise.
• USA Compression Partners has a valuation of $4.03 billion and focuses on providing natural gas compression services, operating one of North America’s largest fleets of compression equipment to support energy production.
• Nabors Industries is valued at $1.16 billion and is a global leader in drilling services, offering both land-based and offshore drilling solutions in over 20 countries, supporting oil and gas exploration with advanced technology and innovative approaches.

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