Chevron-Hess Tie Up Could Drag Until Next Year Courtesy of Exxon

Chevron ’s acquisition of Guyana superstar Hess could be delayed until next year thanks to Exxon Mobil’s arbitration case, Hess said in a Friday securities filing. Hess said in the filing that the $53 billion merger could be delayed until 2025. The deal was originally supposed to close this summer. Both Exxon and

have brought cases against the acquisition, arguing that, as current partners with Hess in the prolific Stabroek block, they legally have the right of first refusal. In October, Chevron said that it would purchase Hess Corporation in an all-stock transaction valued at a whopping $53 billion. The deal would give Chevron a bite at some of the world’s most coveted oil reserves in Guyana’s Stabroek block.

quickly mounted a similar challenge. Chevron has argued that the right of first refusal does not apply because the deal is for the acquisition of the entirety of Hess, and not just for its Guyana assets. Guyana has become a hotspot for oil exploration and development in recent years after Exxon and Hess found more than 11 billion barrels of oil equivalent offshore the South American country.

, is currently producing all the crude oil in Guyana—the world’s newest oil-producing nation. Exxon holds a 45% stake in the Stabroek block, with Hess holding a 30% stake. Production from Stabroek is on track to soon reach 620,000 bpd, with some estimating this to rise to 1.2 million bpd by 2027. Without Hess’s share of Guyana’s assets in the mix, Chevron is unlikely to be interested in a Hess acquisition at all. By Julianne Geiger for Oilprice.

Source: News Formal (newsformal.com)

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