The arbitrators in a legal dispute between Exxon Mobil (XOM.N), opens new tab and Hess (HES.N), opens new tab have reached a decision related to a major oilfield project in Guyana, according to two sources familiar with the matter.
The ruling will determine whether Chevron (CVX.N), opens new tab can move forward with its $53 billion planned acquisition of Hess.
It is unclear what the arbitrators decided or when the decision will be released.
“We remain confident in our position and appreciate the arbitration panel giving this issue the due consideration it deserves,” an Exxon spokesperson said in a statement.
Hess, Chevron and the ICC did not immediately respond to requests for comment.
Chevron struck its deal to acquire smaller U.S. oil producer Hess in October 2023, with the prize being the latter’s 30% stake in the prolific Stabroek block in Guyana that is operated by Exxon with a 45% interest.
The closing of the acquisition has been delayed due to arbitration claims from Exxon and CNOOC (600938.SS), opens new tab, the other minority partner in the joint venture, who argue that they have a contractual right of first refusal to purchase Hess’ stake in the Stabroek block. CNOOC did not immediately respond to request for comment.
Chevron and Hess argue the clause does not apply to the sale of the whole company. If they lose the arbitration or are unable to agree on an acceptable resolution with Exxon and CNOOC, the acquisition would fail, according to the terms of the deal.
The stakes are high for Chevron. Acquiring Hess is key to Chevron CEO Mike Wirth’s strategy to improve the company’s performance. Gaining access to the Stabroek block would provide a valuable addition to Chevron’s declining oil and gas reserves. (Reuters)
