Chevron Products Company entered into a $120 million prepayment and commercial agreement with Frontera Energy’s Colombian subsidiary on December 29, 2025. The contract provides Chevron with a steady supply of crude oil for a two‑year period, reinforcing the company’s upstream feedstock pipeline and supporting its downstream refining and petrochemical operations.
The agreement is structured as an initial $80 million prepayment, with an option for an additional $40 million that can be exercised at Chevron’s discretion. The deal replaces a prepayment arrangement that was set to expire at the end of January 2026, giving Chevron immediate liquidity while securing a long‑term offtake of crude from Frontera’s Colombian fields.
Chevron’s strategy has long focused on securing low‑cost, reliable feedstock to maintain margin stability in a volatile oil‑price environment. By locking in a two‑year supply, Chevron reduces exposure to spot‑market fluctuations and ensures a consistent volume of crude for its refining network, aligning with its broader asset‑portfolio optimization goals.
For Frontera Energy, the $120 million agreement delivers critical working‑capital liquidity and replaces an expiring financing arrangement. The cash infusion supports ongoing operations in Colombia and Ecuador and provides a financial cushion amid recent challenges, such as the cancellation of a joint‑venture license in Guyana earlier in the year.
The deal reflects broader market dynamics in which major refiners seek secure upstream sources to hedge against supply disruptions, while producers look for stable offtake partners to shore up cash flow. Chevron’s move strengthens its competitive position in the Colombian market, while Frontera gains a reliable revenue stream that can be leveraged for future exploration and production initiatives.
Overall, the agreement represents a strategic win for both parties: Chevron secures a dependable crude supply and immediate liquidity, and Frontera gains financial stability and a long‑term offtake partner, positioning both companies for sustained operational performance in a challenging energy landscape.
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