Chevron is looking to close the gap between it and Exxon Mobil Corp. through the acquisition of Hess Corp.
CEO of Hess, John Hess said he’s “very confident” that the company’s planned $53 billion sale to Chevron will be completed.
“We’re very confident that the merger is going to go through and we’re getting prepared for that,” Hess said at the Goldman Sachs Global Energy, Clean Technologies & Utilities Conference on Tuesday.
Hess expects that an arbitration panel over Exxon Mobil’s right-of-first-refusal claim on Hess’ 30 per cent stake in Guyana’s huge oil discovery will make its final decision by late August or September with the hearing set to commence in May.
“I think it should be wrapped up by September,’’ Hess said.
“The three arbitrators that are in-place now have been very clear. That’s when their decision is going to be rendered. And once that’s done, we’ll close our deal
A ruling on Chevron’s proposed acquisition of Hess is due in 2025.
Chevron expects to achieve these results thanks to the start of new or expanded oil production projects in Kazakhstan, growth in U.S. shale and offshore U.S. Gulf of Mexico.
Chevron has projected oil production growth in the Gulf of Mexico to clock in at 300,000 barrels per day by 2026, up from 200,000 last year.
Back in August, Chevron produced its first oil from a pioneering U.S. Gulf of Mexico deepwater field under extreme pressures.
The field is expected to produce up to 75,000 barrels of oil per day at its peak, with the company lining up two more offshore projects.
Exxon has been trying to stop the merger with the future of the deal resting on whether the transaction would involve a change of control of Hess’ Guyana subsidiary.
Exxon claims Hess should have first given it the opportunity to purchase its stake in the prized Guyana asset, and that Chevron structured the deal in a way to bypass Exxon’s right of first refusal if it’s triggered by a change of control in Guyana.
