Are we really about to buy HESS?
10 replies (most recent on top)
Not buying Hess. Just trying to get back that 30% that the Exploration Manager sold to Hess just before he instructed Wells to “Go drill the cheapest dry hole in history so we can go ahead and sell the other 45% of Guyana”
Oops. Need a do-over.
Darren said we are not. Google it
Think this is done to protect all the shady activities that will likely void the PSA and lose XOM its role as operator as Chevron has more people to review all the past spend than HESS or CNOOC Were willing to commit to the cash cow that we gave away because we were scared to drill a possible dry hole.
Absolutely zero chance our lawyers got the ROFR language wrong. This merger loophole issue is well understood and would have been addressed in the original farm-in agreement. Chevron is bluffing.
We should buy
More people to be piped
There is likely a clause in the agreement with Hess that EM has first rights to buy the Hess 45% stake in Guyana.
The debate is whether an outright purchase of Hess by Chevron constitutes “sale” of the stake, as Chevron could take control of Hess as a wholly owned subsidiary such that Hess still legally exists and owns the 45%. No sale occurs.
Oops, another reason EM should not have sold 45% prior to drilling the first well.
Hess trucks back and its better than ever!
https://finance.yahoo.com/news/exxon-considers-pre-emption-rights-220115518.html
Exxon Considers Pre-Emption Rights to Hess’ Guyana Oil Stake
By Kevin Crowley
Mon, February 26, 2024 at 7:17 PM EST
(Bloomberg) -- Exxon Mobil Corp. and Cnooc Ltd. are considering exercising rights to acquire Hess Corp.’s stake in a giant offshore oil development in Guyana, a move that could break up Chevron Corp.’s $53 billion deal to buy into the field.
Chevron is adamant there’s “no possible scenario” Exxon or Cnooc could buy the stake, and said in a statement that it remains fully committed to the Hess deal. But Exxon said it has a duty to its shareholders to explore the right of first refusal over the change of ownership of the Hess stake. Hess shares slid 3.3% to $144.96 at 6:32 p.m. in late New York trading.
The moves hold the potential to kick off a high-stakes battle for the fastest-growing and largest oil discovery of the past decade and the main reason Chevron struck a deal to buy Hess in October. Exxon, the operator of the project, first found oil in Guyanese waters in 2015 and has since discovered 11 billion barrels of reserves. The company expects production there to double to 1.2 million barrels a day by 2027.
“We owe it to our investors and partners to consider our pre-emption rights in place under our Joint Operating Agreement to ensure we preserve our right to realize the significant value we’ve created and are entitled to in the Guyana asset,” Exxon said in a statement Monday.
Cnooc didn’t immediately respond to an emailed request for comment.
The dispute over Guyana’s Stabroek Block underscores how important the emerging basin is to global crude markets. Oil majors have struck a flurry of megadeals in recent months to secure stakes in proven reserves without building new projects that would increase global supplies.
Exxon and Cnooc’s right of first refusal is “not applicable” to its merger with Hess, Chevron said in an emailed statement. “As described in the S-4, there is no possible scenario in which Exxon or Cnooc could acquire Hess’ interest in Guyana as a result of the Chevron-Hess transaction.”
Still, the company warned in a regulatory filing Monday there’s a risk the deal may not be completed if if Exxon and Cnooc launch a successful counterbid.
“If these discussions do not result in an acceptable resolution, and arbitration (if pursued) does not result in a confirmation that such right of first refusal provision is inapplicable to the merger, then there would be a failure of a closing condition under the Merger Agreement, in which case the merger would not close,” Chevron said.
- With assistance from Dan Murtaugh.
(Updates with Chevron’s comment starting in second paragraph.)
Gotta give it to DW, he’s taken the crown from Lee on “How to be an Oil Exec”!
Get out of the way, Wirth; big boys playing here!
Certainly looks like we may buy their Guyana stake.