Chevron fnalises $53bn Hess acquisition, secures key stake in Guyana
Chevron Corporation officially completed its $53 billion acquisition of Hess Corporation, cementing a major expansion of its upstream portfolio and securing a 30% interest in the highly prized Stabroek Block offshore Guyana.
The deal, first announced in October 2023, cleared its final regulatory and legal hurdles this month following a closely watched arbitration case. Rival operator ExxonMobil and partner CNOOC had challenged the acquisition on the basis of pre-emption rights related to the Guyanese asset, but the International Chamber of Commerce ruled in Chevron’s favour.
With the transaction closed, Chevron not only gains strategic access to one of the most prolific deepwater discoveries of the past decade—estimated to hold over 11 billion barrels of recoverable oil, but also strengthens its position in the US Bakken shale, Gulf of Mexico and Southeast Asia.
“This acquisition builds on our long-term strategy and provides Chevron with a high-quality asset base that will deliver strong returns for decades,” said Mike Wirth, Chairman and CEO of Chevron. “Guyana is a world-class resource and will play a central role in our future production growth.”
The move comes at a pivotal time for Chevron, which has been under pressure to rebuild reserves and bolster free cash flow amid volatile oil markets. Analysts estimate the acquisition will add over 465,000 barrels of oil equivalent per day to Chevron’s output and deliver $1 billion in annual cost synergies by the end of 2025.
As part of the deal, John Hess, CEO of Hess Corporation, will join Chevron’s Board of Directors. The integration process is expected to involve some consolidation, particularly in back-office operations, as Chevron streamlines overlapping assets.
Despite earlier concerns from regulators, the US Federal Trade Commission gave the green light after Chevron agreed to certain transparency measures regarding executive appointments and capital allocation.
Energy markets responded favourably, with Chevron shares climbing 2.1% on news of the closure. Analysts described the acquisition as a transformative move that strengthens Chevron’s competitive edge in deepwater and tight-oil markets.
Chevron will provide further details during its Q2 earnings call on 1 August and is expected to unveil a full post-acquisition strategy at its Investor Day in New York this November.
