On Monday, Chevron Corp (NYSE: CVX) announced that the Federal Trade Commission (FTC) completed an antitrust review of its merger with Hess Corp (NYSE: HES), satisfying a critical closing condition for the transaction.
To facilitate the merger's completion, Hess and Chevron have agreed that Hess CEO John Hess will not be on the Chevron board.
Instead, Mr. Hess will serve as an advisor to Chevron on government relations and social investments in Guyana and on support for the Salk Institute's Harnessing Plants Initiative.
"I have the utmost respect for John, the company he has built, and the contributions he has made to our industry. It is unfortunate that our Board of Directors will not get the benefit of his decades of global experience, but we look forward to drawing upon his knowledge, relationships and experience in Guyana through his service as an advisor to Chevron," said Chevron Chairman and CEO Mr. Wirth.
"Oil and gas are going to be needed for decades to come, and the key challenge is long-term investment," Mr. Hess said. "For more than ten years, I have advocated for a significant increase in global investment, both in oil and gas and renewable energy, to have the necessary supply to keep energy affordable and secure for American consumers in the future."
The merger's completion remains subject to other closing conditions, including the satisfactory resolution of ongoing arbitration proceedings regarding preemptive rights in the Stabroek Block joint operating agreement. Chevron said it remains confident that the arbitration process will affirm the company's position.
Prior reports indicated Exxon Mobil Corp (NYSE: XOM) and its partner CNOOC Ltd asserted their right of first refusal to any sale of Hess' stake in a Guyana oil-producing joint venture potentially hinder Chevron's proposed $53 billion deal of Hess. The arbitration panel is now expected to hear these claims in May 2025.
Under the deal, Chevron will reportedly own a 30% stake in the consortium controlling all of Guyana's oil production. Exxon leads the consortium with a 45% stake.
Earlier, Chevron CEO Michael Wirth had attacked President Joe Biden's administration's halt on liquefied natural gas export, citing higher costs and threatening supplies for America's European backers.
Price Actions: CVX stock is up 0.25% at $145.87 at the last check Monday. HES stock is up 0.72% at $134.58.