The Long Run - How the U.S. Upstream Operations of the Integrated Majors Compare with Independent E&Ps

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energy landscape. Wednesday, July 1, 2026. The Long Run. How the U.

S. Upstream Operations of the Integrated Majors Compare with Independent E&Ps, published by Nicholas Caccioni. For decades, the major integrated oil companies have been judged by their global scale, diversified business models and shareholder returns. Yet one question is rarely asked, how competitive are their U.

S. upstream businesses when measured against independent E&Ps? In today's RBN blog, we provide answers that may surprise many investors. We begin our analysis by isolating the U.

S. upstream operations of BP, Chevron, ExxonMobil and Shell to examine where these assets fit within each company's global portfolio. ExxonMobil and Chevron are the two largest U.S.

producers with 2025 output of 2 million BOE per day and 1.87 million BOE per day, respectively, outpacing Independence Occidental Petroleum, ConocoPhillips, and EOG Resources. BP's 2025 output was 824,000 BOE per day, approximately equal to Devon Energy, before this year's merger with Cotera, while Shell has by far the lowest U.S.

footprint at 378,000 BOE per day. We then compared capital spending, reserves and operating focus before benchmarking each company's U.S. upstream performance against comparable independent E&P peer groups using standardized three-year operating and financial metrics.

The analysis highlights not only where the majors are investing, but also whether those investments are generating competitive upstream returns. Figure 1 of the blog shows the relative size of the four majors U.S. oil and gas reserves and production that are the subject of this blog.

ExxonMobil. ExxonMobil has built the industry's largest and most diversified U.S. upstream portfolio, anchored by a dominant position in the Permian Basin and supported by a legacy natural gas business.

As of December 31, 2025, ExxonMobil reported $299.4 billion of net fixed assets worldwide, of which $219 billion, 73%, was invested in upstream operations. The U.S.

accounted for 63% of those upstream assets, representing approximately 46% of the company's total fixed asset base. During 2025, U.S. properties also represented 38%, 7.

4 billion BOE, of ExxonMobil's global proved reserves. ExxonMobil invested $24.9 billion in organic upstream capital worldwide, with the U.S.

accounting for $12.5 billion, or 50% of total upstream investment. This is approximately equal to the exploration and development capics of ConocoPhillips, Occidental Petroleum and EOG Resources combined. ExxonMobil's $59.

5 billion acquisition of Pioneer Natural Resources in May 2024, see Take Me to the Top, transformed the company into the dominant producer in the Permian Basin. Its extensive acreage across the Midland and Delaware basins provides a deep inventory of high-return drilling opportunities supported by manufacturing style development, integrated infrastructure, and advanced operating technologies. The company's aggressive spending supports its goal of increasing Permian output to 2.

5 million BOE per day by 2030, up from 1.7 million BOE per day in Q1 2026. While the Permian has become the centerpiece of ExxonMobil's domestic growth strategy, the company maintains an offshore presence in the U.S.

Gulf through several deepwater producing fields and exploration prospects. Natural gas also remains an important component of the U.S. portfolio, accounting for approximately 44 of domestic reserves Chevron Chevron has focused on assembling one of the highest quality asset bases in North America Although both it and ExxonMobil are anchored by the Permian Basin and the offshore Gulf, Chevron's strategy places greater emphasis on the upstream through its capital allocation and portfolio optimization.

The core of Chevron's highest quality U.S. onshore upstream portfolio includes the legacy assets stemming from the 2001 merger of Chevron and Texaco, especially its premier Permian position. The company also has a long-life deepwater golf business and a diverse set of additional assets acquired through recent purchases of Hess Corporation and PDC Corporation.

As of December 31, 2025, Chevron reported $217.9 billion of net fixed assets, with $205.2 billion, 94%, invested in upstream operations. The U.

S. accounted for $72.4 billion, or 35% of global upstream investment, while Guyana, following the Hess acquisition, see Surprise, Surprise, represented the only region approaching the investment scale of Chevron's U.S.

asset base, 26%. About 54% of 2025 organic upstream capital spending, or approximately $9 billion, was directed to the U.S. compared with 17% for Guyana.

That level of investment was a third below ExxonMobil but significantly higher than the major U.S. E&Ps. U.

S. properties also accounted for 44% of Chevron's global oil and gas reserves. Chevron's U.S.

operations are centered on the Permian Basin and the Deepwater U.S. Gulf, complemented by established positions in the D.J.

Basin in California, plus the Bakken after its Hess acquisition. The company is one of the largest acreage holders in the Midland and Delaware basins, where large-scale pad development and integrated infrastructure continue to support efficient, low-cost production. Deepwater operations provide an important counterbalance to Chevron's shale business. Major producing hubs in the Gulf, including Jack-slash-St.

Malo and Tahiti, contribute long-life, high-margin production that complements the shorter-cycle economics of the Permian. BP. In stark contrast to the Permian focus of ExxonMobil and Chevron, BP has concentrated its U.S.

upstream portfolio on LNG-leveraged natural gas assets balanced with significant deepwater U.S. Gulf projects. As of December 31, 2025, BP reported just under $100 billion of net fixed assets globally, with approximately 60% invested in upstream operations.

The U.S. represented 54% of BP's upstream asset base and 43% of global oil and gas reserves, orange slice in right chart in figure 6 below, making it the company's most important upstream region. About 51% of BP's $9.

8 billion of 2025 organic upstream capital spending, or $4.9 billion, was spent in the U.S., orange slice in left chart, approximately the same level of investment by Occidental Petroleum and EOG Resources.

BP's U.S. upstream portfolio combines large deepwater Gulf developments and onshore shale operations, operated by its subsidiary BPX Energy. Following its 2018 acquisition of BHP's U.

S. unconventional oil and gas assets, BP substantially expanded its position in the Haynesville Shale of East Texas and Louisiana, strengthening its exposure to growing Gulf Coast LNG demand. BP also has positions in the Eagleford and Delaware Basin. As shown in Figure 7 below, BP remains one of the Gulf's largest producers through major hubs including Thunderhorse, Atlantis, Mad Dog, and Nakika.

These long-life developments generate high-margin production and continue to provide a significant portion of BP's global upstream cash flow. Shell. Unlike the other majors, Shell has concentrated its U.S.

upstream business almost exclusively in the deepwater Gulf, divesting its onshore shale assets in transactions, highlighted by the $9.5 billion sale of its Permian properties to ConocoPhillips in 2021. That strategic focus gives Shell a distinctly different investment profile and ultimately leads to a different set of operating and financial outcomes As of December 31 2025 Shell reported billion of net fixed assets globally, with $113 billion, 61%, invested in upstream operations.

Although the company does not disclose regional capitalized costs, the U.S. accounted for 34% of 2025 upstream capital spending, or approximately $2.80 billion-$3 billion, while representing only 6% of global oil and gas reserves.

This apparent imbalance reflects Shell's strategy of concentrating investment in a relatively small number of high-return offshore projects rather than pursuing broad reserve growth. During 2025, Shell reinforced its offshore gulf strategy by starting up the Whale and Dover developments and increasing its ownership interest in the IHRSA platform. These investments further strengthened a deepwater portfolio that includes major producing hubs such as Mars, Olympus, Augur, Perdido, Ursa, Appomattox, Vito, Stones, and Whale.

The company also achieved its highest quarterly Gulf production since 2005. Shell said June 30 it has agreed to sell its 50% non-operated working interest in the BP-operated Nakika platform and associated fields in the offshore Gulf, as well as its 100% owned Coulomb tieback to Talus Energy and Ridgewood Energy for $1.7 billion. Unlike the shale-focused strategies of BP, ExxonMobil and Chevron, Shell's U.

S. portfolio is built around a relatively small number of long-life offshore developments that require substantial upfront investment but generate high-margin production over extended periods. This investment model results in less predictable reserve additions than those of manufacturing-style shale operators, but provides meaningful exposure to some of the world's most attractive deepwater assets. How do the majors stack up against the U.

S. E&Ps? The four integrated majors have assembled high-quality U.S.

upstream portfolios, but they have done so using very different strategies. To evaluate whether those strategies translate into superior performance, we benchmarked each company's U.S. upstream business against comparable independent E&P peer groups.

Chevron and Shell were compared with the oil-weighted E&Ps because their U.S. portfolios are 71% and 85% oil-weighted, respectively, while BP and Exxon Mobile were benchmarked against the diversified E&Ps given their U.S.

oil weightings of 56% and 62%. Figure 10 of the blog shows that, despite their world-class asset bases, Chevron and Shell generally underperformed the oil-weighted E&Ps on investment metrics during 2023-25. Independent producers replaced reserves more efficiently, generated lower finding and development, F&D, costs, and achieved materially higher recycle ratios than either integrated major. Much of this difference reflects portfolio composition.

Chevron's results were broadly comparable to the peer group but benefited from a balanced mix of Permian shale and deepwater production. Shell's deepwater portfolio, by contrast, requires larger upfront investments and produces less consistent reserve additions than manufacturing-style shale development, as investments can continue for years before reserve additions are booked. As a result, reserve replacement metrics tend to be more volatile despite the high quality of Shell's underlying assets.

Shell distinguished itself on profitability. The company generated the highest upstream revenues per BOE, the lowest lifting costs and the strongest cash flow among the three groups, demonstrating the economic strength of its deepwater portfolio. However, those operating advantages were more than offset by weaker capital efficiency, leaving Shell with the lowest recycle ratio of the comparison. BP and ExxonMobil vs.

the Diversified ENPs Figure 11 shows the comparison between BP, ExxonMobil and the Diversified ENPs produced a different outcome. ExxonMobil generated the strongest overall performance driven by exceptional investment efficiency despite reserve revisions that weighed on traditional reserve replacement metrics When reserve revisions are excluded ExxonMobil F cost of per BOE substantially outperformed both BP and the diversified peer group highlighting the quality of its underlying investment program.

BP, meanwhile, led the group in operating profitability, posting the highest upstream revenues per BOE, the lowest lifting costs, and the strongest pre-tax income and cash flow. Ultimately, ExxonMobil's superior investment performance more than offset BP's operating advantages, producing an industry-leading recycle ratio of 339% compared with 251% for the diversified E&Ps and 75% for BP. Conclusion Although each of the four majors has assembled a highly competitive U.S.

upstream business, their strategies and results differ considerably. BP has positioned itself to benefit from growing North American LNG demand. ExxonMobil has built an unmatched Permian franchise supported by a legacy gas business. Chevron has assembled one of the industry's highest quality portfolios, and Shell has focused on maximizing long-term value from deepwater Gulf developments.

The benchmarking results suggest that independent E&Ps continue to hold an advantage in capital efficiency, particularly in reserve replacement and F&D costs. The integrated majors, however, often benefit from higher margin assets, greater portfolio diversification, and stronger operating cash flows. In other words, the majors are optimizing portfolio quality, while the independents continue to optimize capital efficiency. The Long Run was written by Don Henley and Glenn Frey and appears as the first song on side one of the Eagles' sixth studio album of the same name.

The song is about commitment in a romantic relationship, but it also addresses Henley and Frey's response to being labeled passé by music critics during the disco and punk eras. The song style is an homage to the R&B sounds that came out of Stack Studios in Memphis in the 1960s. Released as the second single from the album in November 1979, it went to No. 8 on the Billboard Hot 100 Singles Chart and has been certified platinum by the Recording Industry Association of America.

Personnel on the record were Don Henley, lead vocals, drums, Glenn Frey, rhythm guitar, backing vocals, Joe Walsh, slide guitar, backing vocals, Don Felder, slide guitar, Hammond organ, backing vocals, Timothy B. Schmidt, bass, backing vocals, and Joe Vitale, electric piano. The album, The Long Run, was recorded between March 1978 and September 1979 at Criteria in Miami, Bayshore in Coconut Beach, Florida, and Record Plant, One Step, Love and Comfort and Britannia in Los Angeles.

Produced by Bill Swyamsyke, It was released in September 1979. It went to number one on the Billboard 200 Albums chart and has been certified 7X Platinum by the RIAA. It was the first Eagles album to feature Timothy B. Schmidt on bass and the last full-length Eagles album to feature Don Felder on guitar.

Three singles were released from the LP. The Eagles are an American rock band formed in Los Angeles in 1970 won by Don Henley, Glenn Frey, Bernie Ledin, and Randy Meisner. All of the band members worked, recorded and toured with Linda Ronstadt before the Eagles' career took off. They have released seven studio albums, three live albums, 10 compilation albums and 30 singles.

They have sold more than 150 million records worldwide. They are members of the Rock and Roll Hall of Fame and the Vocal Group Hall of Fame, have won four CMA awards, six Grammy awards, and have received Kennedy Center honors. Nine members have passed through the band since its formation. Founding member Glenn Frey died in New York City in January 2016 at 67, and founding member Randy Meisner died in Los Angeles in July 2023 at 77.

The band continues to tour and will be appearing at The Sphere in Las Vegas in September and November. Thanks for listening to the RBN Daily Energy broadcast. For more information on energy market reports, maps, and consulting engagements, please visit us at rbnenergy.com.

And thanks for rocking with us.