A three-way race is intensifying for the Guyana offshore oilfield business

A three-way race is intensifying for the Guyana offshore oilfield business, which is estimated to contain at least 11 billion barrels of oil and gas, including Exxon Mobil and Chevron, the two largest U.S. oil companies, and Hess, an oil exploration company. Some point out that while ExxonMobil is blocking Chevron, which has a stake in the key Guyana oil field, the dispute between the two companies could intensify and the large acquisition deal in the U.S. oil industry could collapse.

Ahead of the Hess shareholders’ meeting asking whether to approve Chevron’s acquisition deal on the 28th (local time), the Wall Street Journal (WSJ) reported that some shareholders are already abstaining from voting, citing disputes with ExxonMobil. It comes after the world’s second-largest voting advisory body ISS earlier this month advised Hess shareholders to abstain or delay the vote, warning that “the dispute between ExxonMobil and Chevron risks the Hess acquisition deal being destroyed without compensation.”

However, Glass Lewis, another voting advisory body, recommended Hess shareholders to approve it, and Guyana President Irrfan Ali told the Financial Times (FT) on the 27th that he welcomed Chevron to join the ExxonMobil-led consortium, making it difficult to predict the results of the shareholders’ meeting. If Chevron’s takeover offer passes at the Hess shareholders’ meeting, Hess owner John Hess, CEO of Hess Gamoon, will join Chevron’s board of directors and receive approximately $5 billion worth of Chevron shares.

The start of the dispute between the two companies came when Chevron announced in October last year that it would acquire oil exploration company Hess for a record $53 billion (about 72 trillion won). The Stabroke mine, a key area of Guyana’s maritime oil field, has been managed by a consortium with 45% stake in ExxonMobil, 30% stake in Hess and 25% stake in the China Maritime Petroleum Corporation (CNOOC).  Chevron pursued the acquisition in the form of a stock exchange with the goal of acquiring 30% of Hess’s stake in the mining area, and John Hess, CEO of the oil tycoon Hess family, the existing Hess majority shareholder, was scheduled to join Chevron’s board of directors.

Source: mk.co.k