Cheron Corp on Monday said that it will buy its rival Hess Corp in a $53 billion all-stock deal, as the oil major looks to increase its footprint in oil-rich Guyana.
The deal will put two of the top oil giants, Cheron and Exxon Mobil, head-to-head in two of the world fastest growing oil basins – shale and Guyana.
Due to its huge discoveries by Exxon Mobil and its partners Hess and China’s CNOOC, Guyana has become a major oil producer in recent years, producing 400,000 bpd from two offshore vessels and said they could develop up to 10 offshore projects.
To buy Hess, Chevron is offering $171 for every Hess share, implying a premium of about 4.9% to the share’s last close.
The deal is likely to close by the end of first half of 2024 and CEO John Hess of Hess Corp is expected to join board of directors.
In a statement, the companies said that the combined venture is expected to grow oil production and free cash flow faster and for longer than Chevron’s current five-year guidance.