Hess and Chevron prevail in arbitration over Exxon: CNBC

Hess and Chevron prevail in arbitration over Exxon: CNBC

HOUSTON, July 18, 2025 - Chevron (CVX.N) has successfully acquired Hess (HES.N) in a landmark deal valued at $53 billion, following a significant legal victory against Exxon Mobil (XOM.N) [1]. The acquisition, which was delayed by a year due to arbitration claims, allows Chevron to gain access to Hess' stake in the Stabroek Block off the coast of Guyana, a prolific oil discovery that holds over 11 billion barrels of oil.

The legal battle between Chevron and Hess, on one side, and Exxon and CNOOC Ltd (CEOCL.N), on the other, centered on the interpretation of a few critical words in their confidential joint operating agreement. Exxon and CNOOC argued that they had a contractual right-of-first-refusal to buy Hess' 30% stake in the joint venture, while Chevron and Hess maintained that this right did not apply to the sale of the entire Hess company.

The arbitration claims from Exxon and CNOOC, which were filed last year, delayed Chevron's acquisition and drew significant attention from the global oil industry, shareholders, and legal experts. The dispute highlighted the immense value of the Stabroek Block, which has been a significant driver of profits for the Exxon-led consortium and has transformed Guyana into one of the world's fastest-growing economies.

The successful acquisition of Hess by Chevron marks a critical win for CEO Mike Wirth's strategic vision and is expected to help Chevron turn around its lagging performance. The Stabroek Block, with its potential for further oil discoveries, is likely to be a key growth driver for Chevron in the coming years.

References:
[1] Reuters. (2025, July 18). Chevron prevails in mediation over Exxon Guyana oil assets. Retrieved from https://www.reuters.com/business/energy/chevron-prevails-mediation-over-exxon-guyana-oil-assets-cnbc-reports-2025-07-18/