Chevron Corp. (NYSE: CVX) on Friday closed its $53 billion purchase of Hess Corp., winning a protracted legal fight with Exxon Mobil (NYSE: XOM) that centered on prized offshore oil fields in Guyana.
The International Chamber of Commerce ruled in Chevron’s favor, ending a 20-month legal battle that had threatened to derail one of the energy sector’s largest deals in recent years.
“We have maintained from the beginning that this is the outcome that we expected,” Chevron CEO Mike Wirth said Friday. “It’s a straightforward interpretation of contract language, and we’re very pleased that the transaction has now closed.”
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The dispute centered on Exxon’s claim to a right of first refusal over Hess’ 30% stake in Guyana’s offshore Stabroek Block, which contains more than 11 billion barrels of recoverable oil. Exxon operates the project with a 45% stake, while China National Offshore Oil Corp. holds 25%.
Exxon and CNOOC had argued the joint operating agreement gave them preemptive rights to buy Hess’ Guyana assets. Chevron and Hess countered that the provision didn’t apply to a corporate merger.
“We disagree with the ICC panel’s interpretation but respect the arbitration and dispute resolution process,” Exxon said in a statement, adding that they “welcome Chevron to the venture and look forward to continued industry-leading performance and value creation in Guyana for all parties involved.”
The acquisition gives Chevron access to one of the world’s most significant recent oil discoveries and strengthens its position against larger rival Exxon.
Under the deal terms, Hess shareholders receive 1.025 Chevron shares for each Hess share. The transaction had been announced in October 2023 but was delayed by the arbitration proceedings.
The Federal Trade Commission cleared final regulatory hurdles Thursday, lifting restrictions that had prevented former Hess CEO John Hess from potentially joining Chevron’s board.
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