Chevron wins arbitration against Exxon over Hess deal, according to analysts.
Chevron completed its $55 billion purchase of Hess last Friday, after winning a landmark court battle against Exxon Mobil. This was to gain access the largest oil discovery of the past decade - the Stabroek Block offshore of Guyana. It contains more than 11 billion gallons of oil.
STEWART GLICKMAN IS A DEPUTY RESEARCH DIRECTOR FOR CFRA RESEARCH
This project will drive significant growth in production for the next 3 to 5 years. It will also add new weight on the liquids front from Guyana, Permian and Gulf of Mexico. CVX and XOM have to put the legal dispute behind them in order to move forward with their planned development phases.
ALLEN GOOD, MORNINGSTAR ANALYST
We view the outcome as positive for Chevron given the size and quality of the Guyanese asset. We don't see the ruling as negative for Exxon. Their ultimate goal was to deny Chevron access, or secure a favorable ruling that could be used elsewhere, not to acquire the assets themselves.
AJAY PARMAR IS THE OIL AND ENERGY TRANSITION ANALYTICS DIRECTOR OF CONSULTANCY ICIS
Chevron's victory in the arbitration case over the Guyana oil assets is a major win for the U.S. major oil company. Chevron now has a stronger upstream presence in Guyana and Canada, as well as on U.S. shores. We expect it to continue strengthening its portfolio for the next few years.
BIRAJ BORKHATARIA, ANALYST AT RBC CAPITAL MARKETS
We expect Chevron shares to outperform in the next few weeks... now that investors are more confident about the investment case, and can concentrate on the growth of Hess assets as well as free-cash-flow inflections into 2026-2027.
Chevron is expected to delve deeper into the company's long-term plans at (Capital Market Day), which will take place on November 12.
JASON GABELMAN ANALYST AT TD COWEN
Chevron said when it announced the deal that eight assets (Guyana GOA Australia TCO Permian DJ Bakken Eastern Med) were core. This is not clear if it still holds true, as some may see the Bakken area as a potential divestment.
"Chord Energy, Devon Energy and other companies have been acquiring in the basin. We expect Chevron to be interested in future opportunities as a consolidator and/or divesting."
KIM FUSTIER HEAD OF EUROPEAN OIL & GASOLINE RESEARCH HSBC
The Hess acquisition may dilute Chevron's per-share metrics in the near term, given a high oil price implied (close to $80-a-barrel), but it is strategic because it gives Chevron an important growth runway beyond 2027. Hess propels Chevron to become a company that produces 4.2 million barrels of oil per day. This is not far behind Exxon with 4.5 million barrels. Reporting by Seher dareen from London, Vallari Shrivastava and Pooja menon from Bengaluru. Editing by Louise Heavens and Frances Kerry. Mark Potter.
(source: Reuters)
