US energy firm Hess gets stockholders’ approval for $53 billion Chevron merger

Chevron’s biggest rival, ExxonMobil, however, has arbitration proceedings in Guyana’s Stabroek oil block that may prevent merger

The Hess Corporation said Tuesday it received the necessary approval from stockholders to close a $53 billion merger with the Chevron Corporation. The US-based global energy company, which explores and produces crude oil and natural gas, said a majority of outstanding common stockholders voted in favor of the merger agreement.

“We are very pleased that the majority of our stockholders recognize the compelling value of this strategic transaction and look forward to the successful completion of our merger with Chevron,” CEO John Hess said in a statement. “Together we will be positioned as a premier integrated energy company, with the leadership, asset portfolio and financial resources to deliver significant shareholder value for years to come.” While no approval of Chevron stockholders is required for the merger, Chevron and Hess are working to complete the deal as soon as practicable, according to the statement.

Chevron announced in October it would buy Hess for $53 billion, but it warned investors in February that the deal may be at risk due to Guyana’s offshore oil assets, which are under a joint operating agreement. While China National Offshore Oil Corporation holds a 25% stake, Hess has 30% and ExxonMobil a 45% stake in the joint agreement that develops Guyana’s Stabroek oil block, which is estimated to have nearly 11 billion oil-equivalent barrels of recoverable resource, according to Exxon. The US’ biggest energy company, ExxonMobil initiated in March arbitration proceedings to assert its rights in the Stabroek oil block, which may prevent Hess’ merger with Chevron — the second largest energy firm in the US.