By Sheila Dang
Houston (Reuters) -Chevron closed the HESS acquisition worth $ 55 billion on Friday after winning a remarkable legal battle against the greater rival Exxon Mobil to gain access to the biggest detection of oil for decades.
The strategy of Chevron Executive Director Mike Wirt to turn the lagging presentation of his company depended on the acquisition, one of the largest energy deals over the past decade. The award is a stake in the Stabrooek Fruit Block off the coast of Guiana, which contains more than 11 billion barrels of oil and is one of the fastest growing oil provinces in the world.
Chevron shares increased by 3% in the trading of subjects, while the HESS shares jumped 7%. Exxon shares were slightly smaller.
“This merger of two major US companies brings together the best in the industry,” Warth said in a statement.
China’s Exxon and CNOOC, HES partners in Guyana, have filed arbitration disputes that claim to have had a preventive right to buy HES share, which delayed the closure of Chevron for the acquisition of HES for more than a year.
“We do not agree with the interpretation of the International Chamber of Commerce (ICC), but we adhere to the arbitration and dispute resolution process,” the Exxon statement said.
“Given the considerable value we created in the development of the Guiana resource, we believed that we had a clear obligation to our investors to look at our prevention rights in order to protect the value we created through our innovations and hard work at a time when no one knew how successfully this endeavor would become,” the company added.
There is no process of appeal in the International Chamber of Commerce, the court leading the arbitration case.
CNOOC did not immediately respond to Reuters’ requests for comment.
Even while expecting the arbitration sentence, Shevron was preparing so that he could finish the HES deal within 48 hours after the arbitration was allowed and perform other operating tasks within 45 days, Reuters reported earlier.
Information technology workers from Shevron and HES meet regularly to plan integration, and HES employees were informed that they could request a compensation package after the transaction was completed.
Exxon and CNOOC claims have launched a long legal battle that has attracted the attention of the global oil industry, shareholders and lawyers who develop joint operational agreements that manage oil partnerships around the world.
The dispute focused on interpreting just a few words in the confidential joint exploitation agreement between Exxon, Hess and CNOOC, Reuters experts said.