Author: Sheila Dang
Houst (Reuters) -Chevron can quickly continue the $ 53 billion Hess purchase, winning the oriented legal fight against the greater opponent Exxon Mobil, gaining access to the largest oil discovery over several decades.
The strategy of the Chevron CEO Mike Wirtth to change the results of his company depends on the acquisition, one of the highest in the last decade. The prize is a productive Staberek block off the shores of Guyana with more than 11 billion barrels of oil, and is one of the fastest growing oil provinces in the world.
Chevron’s shares increased by 3% on Premarket and Hess 7%. Exxon shares were slightly smaller.
Exxon and Chinese CNOOC, Hesso’s partners in Gayana, submitted arbitration disputes stating that they had a preventive right to acquire a Hess stake that delayed the closure of Chevron for more than a year to purchase HES.
“We disagree with the interpretation of the International Chamber of Commerce (TBT), but we respect the arbitration and dispute resolution process,” the Exxon said in a statement.
“Given the great value we created in the development of the Gayana source, we believed that we have a clear duty to consider our prevention rights to protect the value we created through our innovation and hard work when no one knew this company would become,” the company added.
There is no appeal process in the International Chamber of Commerce, a court that overseen the arbitration case.
Chevron, Hess and Cnoc did not immediately respond to Reuters’ requests.
Even while waiting for the arbitration verdict, Chevron was preparing to complete the agreement with Hess in 48 hours within 48 hours of resolution of arbitration, Reuters said.
Information technology workers from Chevron and Hess regularly met in planning integration, and Hess staff was informed that they could ask for a severance pack after the end of the agreement.
Exxon and Cnooc claims have launched a long legal struggle, which attracted the attention of the global oil industry, shareholders and lawyers, which form a joint activity agreement regulating the oil partnership worldwide.
The dispute was directed to the interpretation of only a few words in a confidential joint activity agreement between Exxon, Hess and Cnooc, Reuters experts said.
CNBC, who first announced the Chevron victory news, is quoted in an interview with Exxon CEO Darren Woods, who said the company had dealt with a resolution to determine whether to conclude contracts to be interested in future disputes.