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Arbitration Panel Formed for Exxon Mobil's Claim Against Chevron-Hess Mega-Merger
The final member has been chosen for the three-person arbitration panel intended to resolve Exxon Mobil's objection to Chevron's $53 billion acquisition of Hess Corp. This information comes from two individuals familiar with the situation. The completion of the panel marks a significant step forward in a process that has faced delays and brought uncertainty to the deal, which Chevron and Hess originally expected to finalize in the first half of 2024.
"The appointment of the full arbitration panel is now being completed. We expect to learn more about the (proceedings) schedule in the coming weeks," said one source. Exxon Mobil initiated the arbitration claim with the International Chamber of Commerce (ICC) in March, asserting its right of first refusal over Hess's assets in Guyana. Exxon, which operates all oil production in Guyana along with partners Hess and China's CNOOC, claims that the acquisition is a move to sidestep its rights to the lucrative assets in the region.
However, Chevron and Hess maintain that Exxon's right of first refusal is not applicable, citing the specific structure of the merger and the language used in the Guyana partnership agreement. According to those familiar with the process, the three-person arbitration panel is formed by each side appointing one arbitrator, who then jointly select the third arbitrator.
On May 9, Hess CEO John Hess indicated that the final arbitrator would be appointed by May 17, based on information from proxy adviser Institutional Shareholder Services. Meanwhile, Exxon CEO Darren Woods suggested that the dispute could extend into 2025. Chevron, Hess, and Exxon, however, have all declined to provide any comments on the projected timeline for resolving the issue.
