Chevron has taken a 78 percent stake in the ACES Delta hydrogen project in Utah, the scheme built to store hydrogen in salt caverns for a power plant. The price was not disclosed. Chevron did not buy the stake from the project. It bought the company that owned it, and the capital that built the plant had come from somewhere else.
Key takeaways
- Chevron announced on 12 September 2023 that it had acquired a 78 percent majority stake in the Advanced Clean Energy Storage (ACES) Delta hydrogen project in Delta, Utah, from Haddington Ventures. The deal value was not disclosed.
- Chevron acquired the ACES Delta stake by buying 100 percent of Magnum Development, a Haddington Ventures portfolio company, which held the 78 percent interest. Mitsubishi Power remains in the project as a minority investor.
- The ACES Delta project uses 220 MW of electrolysers to produce green hydrogen and stores it in two salt caverns of 4.5 million barrels each, holding enough hydrogen to provide over 300 GWh of energy.
- Stored hydrogen from ACES Delta fuels the Intermountain Power Agency's 840 MW hybrid combined cycle gas turbine plant, which replaces a retiring 1.8 GW coal plant and runs on a 70 percent natural gas and 30 percent hydrogen blend.
- Before Chevron's acquisition, ACES Delta had a $504.4 million US Department of Energy loan guarantee issued in June 2022 and $650 million of construction equity from Haddington Ventures' Haddington ESP I.
What did Chevron actually buy?
It bought a company, not a project interest. ACES Delta was developed as a joint venture between Mitsubishi Power Americas and Magnum Development, which Haddington Ventures owned. Chevron acquired all of Magnum Development, and with it Magnum's 78 percent share of ACES Delta. Leap's project record now lists the owners as Chevron with 78 percent and Mitsubishi with 22 percent.
Buying the holding company rather than the stake directly usually keeps the project's own contracts, permits and financing in place, because the entity that signed them does not change. For a project already in construction with a federal loan guarantee and signed offtake, that continuity is the point.
The transaction was also not a surprise. Leap records that it followed a framework agreement Chevron signed with the project developer in September 2021 for the acquisition of a stake. Two years passed between the framework and the completed purchase, and construction had started in June 2022 in the meantime.
How does a salt cavern turn hydrogen into storage?
By holding it until the grid needs it. A salt cavern is a large void dissolved out of an underground salt formation, sealed by the salt itself and suited to storing gas under pressure. ACES Delta has two, each of 4.5 million barrels. Leap's project record puts their combined capacity at approximately 11,000 tons of hydrogen, equivalent to over 300 GWh of dispatchable energy.
The cycle works in two halves. During off-peak hours the 220 MW of electrolysers run on renewable electricity and produce up to 100 tonnes of hydrogen a day, which goes into the caverns. During peak hours, and when wind and solar output is low, the stored hydrogen fuels the Intermountain Power Agency's 840 MW combined cycle plant. That plant replaces a 1.8 GW coal unit and burns a blend of 70 percent natural gas and 30 percent hydrogen. The plant is estimated to help prevent 126,517 metric tons of CO2 emissions a year on that blend.
Seasonal storage is the distinctive feature. A lithium-ion battery shifts power across hours. A salt cavern full of hydrogen can shift it across months, which is what the project's description of long-term seasonal energy storage refers to.
Who paid to build it?
Mostly others, before Chevron arrived. In June 2022 the US Department of Energy issued a $504.4 million loan guarantee for the project, meaning the government stands behind the debt if the borrower defaults. Haddington Ventures then contributed $650 million in construction equity through Haddington ESP I, a vehicle whose investors included Alberta Investment Management Corporation, GIC, Manulife Financial Corporation and Ontario Teachers' Pension Plan Board.
That is over $1.15 billion of guaranteed debt and committed equity in place before the sale. ACES Delta had also secured its major contracts, covering offtake with Intermountain Power Agency, engineering and construction, equipment supply and operations. Mitsubishi Power supplies equipment and HydrogenPro supplies the alkaline water electrolysers.
So Chevron did not take development risk. It bought into a construction-stage asset with its financing, offtake and supply chain already signed, and with the developer's construction equity already committed. Citigroup Global Markets advised Chevron, Jefferies advised Haddington and Sullivan & Cromwell was Chevron's legal adviser.
Enerdatics records 62 US hydrogen M&A transactions from January 2022 to December 2024. Of those, 34 are joint ventures, 22 are corporate investments and only six are asset deals. Among the six asset deals, only one carries a disclosed value: Fortescue Future Industries' $24 million purchase of the Phoenix Hydrogen Hub from Nikola in July 2023. Chevron's purchase of ACES Delta, Plug Power's sale of 40 percent of its Limestone plant to Fortescue, and ADNOC's and Mitsubishi Corporation's moves into ExxonMobil's Baytown project all carry no disclosed price. The 22 corporate deals disclose a combined $887.7 million, almost all of it venture-style funding rounds for technology companies rather than prices for projects.
What does the deal signal for US hydrogen?
It signals that Chevron was willing to buy a US hydrogen project once someone else had carried it through financing and into construction. More than half of the US hydrogen activity in Leap's data is joint venture and partnership work. Actual asset changes of ownership are rare, and when they happen the price usually stays private.
It also signals what makes a hydrogen project buyable. ACES Delta has a named offtaker with a defined use, a power plant that needs the fuel, and a storage asset that gives it a role in the grid. Projects tied to secured demand look different from speculative capacity, a pattern also visible in Plug Power's demand-linked hydrogen facility in Georgia.
The timing has since moved. When Chevron bought in, the project was expected to start operations in mid 2025. Leap's project record now shows commercial operations beginning in February 2026. For a buyer that paid for a construction-stage asset rather than a development one, a delay of that length is the risk it accepted.
Frequently asked questions
How much of ACES Delta does Chevron own?Chevron owns a 78 percent majority stake in ACES Delta, acquired by buying 100 percent of Magnum Development from Haddington Ventures. Mitsubishi Power holds the remaining minority interest.
How much did Chevron pay for ACES Delta?The deal value was not disclosed. Before the acquisition the project had a $504.4 million DOE loan guarantee and $650 million of construction equity from Haddington ESP I.
What does the ACES Delta hydrogen project do?ACES Delta uses 220 MW of electrolysers to make green hydrogen, stores it in two salt caverns holding over 300 GWh of energy, and supplies it to Intermountain Power Agency's 840 MW hydrogen-capable gas plant in Delta, Utah.
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