Energy giant Chevron’s proposed acquisition of crude oil and natural gas company Hess has been met with yet another major obstacle. The arbitration hearing to determine the ownership dispute between Hess and Exxon Mobil Corp. on Guyana’s offshore oil patch known as Stabroek Block has been scheduled for May 2025.
Hess has 30% ownership in Stabroek Block, with Exxon and China National Offshore Oil Corp. (CNOOC) holding the other 70%. Following the announcement of Chevron’s $53 billion deal for Hess, Exxon, and CNOOC challenged Chevron’s entry into Stabroek Block, arguing they have the right of first refusal for Hess’s stake.
Chevron previously stated that it would scrap the Hess acquisition if the Stabroek Block stake wasn’t part of the deal, meaning that the transaction would not close for at least another 10 months. The initial agreement was announced more than nine months ago.
Even if Hess is successful in its arbitration hearing, Chevron will still have to get the green light from the US Federal Trade Commission, which won’t make its decision until the arbitration case is wrapped up.
“Hess and Chevron had expected and requested that this hearing be held earlier. But the arbitrators’ common schedules did not make this possible,” Chevron and Hess said in a joint statement.