(By Nilanjan Choudhury, Zacks, 21.Jul.2025, Words: 407) — Chevron Corporation (CVX) has finally completed its big purchase of Hess Corporation, a deal that was held up for almost two years! This happened after an international arbitration panel rejected a challenge from larger rival ExxonMobil XOM.
ExxonMobil had argued that it had the first right to buy Hess’s valuable 30% share in Guyana’s massive Stabroek oil block, claiming their existing agreement gave them special “preemptive rights.”
However, Chevron and Hess disagreed, arguing that these rights didn’t apply to a full company merger, and the panel sided with them. This ruling puts an end to a long, drawn-out legal battle that had created tremendous uncertainty around one of the biggest oil deals in recent memory. For ExxonMobil, this decision is a rare setback, even though ExxonMobil still holds its significant 45% operating stake in the block. ExxonMobil expressed disagreement with the outcome, but stated that it respects the process and welcomes Chevron as a new partner. This legal fight truly highlighted just how incredibly valuable the Guyana oil assets have become, boasting over 11 billion barrels of recoverable oil and being a huge driver of ExxonMobil’s profits recently.
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Now that the Hess deal is finalized, Chevron instantly becomes a major 30% partner in Guyana’s most productive oilfield, and a formal collaborator with ExxonMobil. This also clears the cloud over Chevron’s future growth, which had been overshadowed by concerns about its oil reserves. The arbitration outcome not only removes legal headaches but also forces these two oil giants to work closely together on the ground in Guyana, where oil production is surging. For both companies, the focus can now shift from legal battles to drilling more oil.
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Before Chevron-Hess, ConocoPhillips Sealed a Major Buyout
In May 2024, ConocoPhillips COP, the US oil giant, announced a definitive agreement to acquire smaller peer Marathon Oil Corporation in an all-stock transaction valued at $22.5 billion, including $5.4 billion of net debt. This strategic move, which concluded in November, is seen to be accretive to ConocoPhillips’ earnings, cash flows and return of capital per share. Strengthening its position in shale and LNG markets, this acquisition added 2 billion barrels of resources and diversified ConocoPhillips’ portfolio.
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