HOUSTON—Chevron Corp. (NYSE: CVX), one of the largest acreage holders in the Permian Basin, is ready for more A&D action as it looks to create value for shareholders.

The San Ramon, Calif.-based company is reaching out to companies interested in the Permian Basin, where its net production was about 90,000 barrels of oil and 327 million cubic feet of gas in 2016.

Chevron, like some of its peers, is in the midst of shedding assets worldwide in hopes of bringing in billions of dollars in a lower commodity-price environment. Deals in what could be considered the most watched play in the world—the Permian—aren’t off the table.

So far this year, Chevron has closed on seven deals—some big and some small, Bruce Niemeyer, vice president of Chevron’s Midcontinent unit, said Aug. 16 during the Summer NAPE Business Conference.

“It’s a little like fishing. At the end of the day it’s not the number of fish you catch, it’s the size. ... We have a lot of lines in the water right now,” Niemeyer said during the conference, which bills itself as the place where deals happen. “We’ve got multiple packages.”

Chevron holds about a 2 million-acre position in Permian Basin, which straddles Texas and New Mexico. Most of Chevron’s Permian acreage—about 1.5 million acres— is in the Midland and Delaware sub-basins.

“We will take action in that 1.5 million acres on 150,000 to 200,000 acres the end of this year and next year” to create value that will contribute to the company’s returns and position, Niemeyer said. “There is a very active effort” underway.

In 2015 and 2016, Chevron closed on transactions totaling about 80,000 acres combined. This year, Niemeyer said Chevron anticipates an additional set of transactions for another 60,000 acres. That could grow further in 2018.

“Some are those are trades or swaps … Some will be JVs,” he said, adding others will be farm outs or outright sales.

During the company’s second-quarter 2017 earnings call in July, Chevron executive Jay Johnson said a recent transaction in the Permian “effectively more than tripled the value of our acreage, simply by enabling longer laterals.”

Johnson, executive vice president for Chevron’s upstream unit, added that “generally, the highest-value transactions are swaps to core up acreage and enhance value through long laterals and other infrastructure efficiencies.”

In all, Chevron reported that its proceeds from asset sales in second-quarter 2017 were about $430 million. The bulk of the proceeds were attributed to the sale of properties in the San Juan Basin in New Mexico and Colorado and in the Gulf of Mexico. Chevron said its divestment criteria remain unchanged: the deal was must be a strategic fit, the asset must be unable to compete for capital and the company must receive fair value.

“Assets sold year-to-date and assets expected to be sold later this year have a combined daily production of around 175,000 barrels per day,” Johnson said on the call. “The impact on full-year 2017 production from asset sales is expected to be 25,000 to 75,000 barrels a day, given the late-in-year timing for the sales.”

Chevron is on target with its asset sales program, according CFO Pat Yarrington.

“In fact, we’re already in the $5 billion to $10 billion proceeds range that we established for the 2016 and 2017 years,” Yarrington said on the earnings call. “With six of the eight quarters behind us, cumulative asset sale proceeds now total $5.3 billion: $2.5 billion so far this year and $2.8 billion last year.”

Sales and purchase agreements have already been signed for several transactions for the rest of 2017. Chevron expects to close on at least $1 billion in deals, mostly interenational, in the third quarter.

The program continues as the company works to generate value, including in the Permian—which remains a core focus area of Chevron’s portfolio. Speaking during NAPE, Niemeyer called the Permian a world-class asset that can compete with Chevron’s other assets including those offshore Australia and Kazakhstan. The goal is to generate high returns, earnings and cash flow—what shareholders seek, he added.

The company’s efforts appear to be paying off. Niemeyer pointed out how Chevron used only 40 horizontal wells to reach just less than 20 barrels of oil equivalent per foot in the Delaware’s 2nd Bone Spring. A competitor drilled 120 wells to reach the same level.

“What we seek to do is not be the fastest in a particular area, but ultimately see the highest returns from the program,” Niemeyer said. “We do that by learning from others. We participate in a lot of joint ventures. We do that through the application of technology such as the utilization of seismic, petrophysics, data analytics and a variety of other technologies that are applied on a regular basis.”

Chevron projects its lease operating expenses in the Permian to fall from $6/barrel of oil equivalent (boe) in first-half 2017 to $4/boe in 2020. Improvements are also anticipated in depreciation, depletion and amortization costs, which could fall from $19/boe to $13/boe for the same time frame. Since 2015, development and direct lease operating costs have fallen about 37%.

At $50 WTI, $2.50 gas and $25 NGL, Chevron’s IRR in the Permian for unconventional wells is more than 30%.

Chevron is currently running 20 rigs in the Permian—13 Chevron-operated rigs and seven JV-operated ones. The company said it plans to add rigs about every eight to 10 weeks, bringing the number of rigs it operates in the Permian up to 20 by year-end 2018.

Velda Addison can be reached at vaddison@hartenergy.com.