Chevron is finally able to close its delayed $53bn acquisition of US independent Hess after an arbitration court ruled against ExxonMobil in a dispute over a share of Guyana's vast offshore riches.
ExxonMobil argued it had a right of first refusal over Hess' 30pc stake in the giant Stabroek block, the key attraction behind Chevron's proposed takeover of the company, which was seen as vital in addressing concerns over Chevron's long-term growth prospects. An arbitration hearing was heard in private in London in late May after the two sides were unable to agree on a resolution.
While ExxonMobil said today that it disagreed with the ruling by the International Chamber of Commerce (ICC) Tribunal, it would respect the arbitration and dispute resolution process.
"We welcome Chevron to the venture and look forward to continued industry-leading performance and value creation in Guyana for all parties involved," a company spokesperson said.
Chevron confirmed it had closed the acquisition after prevailing in the arbitration battle with its bigger rival.
"This merger of two great American companies brings together the best in the industry," Chevron's chief executive officer Mike Wirth said. "The combination enhances and extends our growth profile well into the next decade."
ExxonMobil is the operator with a 45pc stake in the Stabroek block off the coast of Guyana, where an estimated 11bn bl of oil equivalent have been discovered over the past decade. Both it and Chinese state-controlled CNOOC, which has a 25pc holding, had asserted pre-emption rights in relation to the Hess stake.
Hess and Chevron had argued that such rights of first refusal do not apply in the event of a corporate takeover. The arbitration process had held up the takeover — first announced in late 2023 — which previously won approval from US anti-trust regulator the Federal Trade Commission as well as Hess shareholders.
ExxonMobil has argued in the past that little would change if Hess ended up winning the arbitration case and Chevron went on to complete its acquisition.
"We have partnerships with Chevron all over the world," ExxonMobil's senior vice-president Neil Chapman said back in May. "It's been no change in terms of how we're working together at all."
