Hess Corp.’s board is recommending its shareholders vote in favor of the proposed $53 billion all-stock merger with Chevron Corp., according to Chevron’s March 28 Securities and Exchange Commission filing.

Chevron said the merger still had hurdles to overcome beyond the approval of Hess’ board and pending votes from Hess shareholders.

A main hurdle revolves around claims from Texas-based Exxon Mobil Corp. and China National Offshore Oil Corp. (CNOOC) regarding their right of first refusal (ROFR) to Hess’ 30% interest in the prolific Stabroek Block offshore Guyana.

“With respect to the Stabroek ROFR, if the arbitration does not result in a confirmation that the Stabroek ROFR is inapplicable to the merger, and if Chevron, Hess, Exxon and/or CNOOC do not otherwise agree upon an acceptable resolution, then there would be a failure of a closing condition under the merger agreement, in which case the merger would not close,” Chevron said in its S-4 filing.

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The transaction’s price represents a 10.3% premium on a 20-day average based on the closing price as of Oct. 20, 2023, the last trading day prior to the official merger announcement, Chevron said.

While Chevron’s Hess grab will see the U.S. major add attractive assets in the U.S. Bakken, Gulf of Mexico and Southeast Asia, Guyana is without question the rising star in Hess’ portfolio.

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