Chevron announced on Monday that it will buy Hess Corp. in a $53-billion all-stock deal.
The company will offer $171 for every Hess share, according to Reuters.
“This combination positions Chevron to strengthen our long-term performance and further enhance our advantaged portfolio by adding world-class assets,” said Chevron Chairman and CEO Mike Wirth. “Importantly, our two companies have similar values and cultures, with a focus on operating safely and with integrity, attracting and developing the best people, making positive contributions to our communities and delivering higher returns and lower carbon.”
Chevron has been looking to expand oil exploration off Guyana’s shores, Reuters reported, something Hess has done with exploration of the Stabroek Block, located approximately 120 miles off Guyana’s coast. The block covers 6.6 million acres, according to Hess.
Guyana has a 30% ownership in more than 11 billion barrels of oil equivalent discovered recoverable resource with high cash margins per barrel, strong production growth outlook and potential exploration upside.
Hess Corp’s CEO, John Hess, is expected to join Chevron’s board of directors once the deal closes around the first half of 2024.
“With greater confidence in projected long-term cash generation, Chevron intends to return more cash to shareholders with higher dividend per share growth and higher share repurchases,” Chevron’s CFO Pierre Breber said in a statement.
It is the second major U.S. oil deal this month. On Oct. 11, Exxon made a $60 billion offer for Pioneer Natural Resources. That deal — worth around $64.5 billion — would make Exxon the biggest producer in the largest oilfield in the United States.
