- By Vaamanaa Sethi
- Mon, 23 Oct 2023 04:27 PM (IST)
- Source:JND
Chevron Corp, a United States-based petroleum refining company, announced that it has signed an agreement to acquire Hess Corp, a smaller rival oil company, in an all-stock transaction totaling $53 billion.
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The acquisition will enhance Chevron's operational footprint in Guyana, South America, an area that is rapidly establishing itself as one of the world's most swiftly growing oil basins.
Hess, in conjunction with Exxon Mobil and China's CNOCC, has collectively yielded 400,000 barrels of oil per day from its two offshore projects in Guyana over the past few years. According to Bloomberg News, these entities have the potential to advance as many as 10 offshore projects in the same region.
"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," the news agency quoted Chevron's chief financial officer Pierre Breber as saying.
According to the terms outlined in the proposed agreement, Chevron is presenting a bid of $171 per share for Hess. This per-share price represents a 4.9 percent increase from the previous closing value.
This deal places Chevron in direct competition with its rival, Exxon Mobil, within the crucial oil basin of Guyana. Furthermore, this development follows shortly after Exxon's announcement of its intent to acquire Pioneer Natural Resources for $60 billion.
If the acquisition of Pioneer proceeds, Exxon would become the largest oil field producer, generating approximately 1.2 million barrels per day, surpassing the output of many OPEC nations, as reported by The Wall Street Journal.
The agreement would also set the stage for the energy giant's most significant acquisition since its merger with Mobil Corp. in 1999.
