(Reuters) – U.S. energy major Chevron has agreed Hess CEO John Hess will not join its board in an agreement with the U.S. Federal Trade Commission to proceed with the $53 billion takeover deal, Bloomberg News reported on Thursday citing people familiar with the matter.
The proposed all-stock acquisition, first announced in October, is one of the biggest in the U.S. oil and gas industry and the latest among a slew of multi-billion dollar deals in the space.
Chevron, Hess and the FTC did not immediately respond to Reuters’ requests for comments.
The approval clears one hurdle, but Chevron still needs to win an arbitration challenge filed by Exxon Mobil over Hess’ stake in a Guyana oilfield – a coveted asset in the proposed merger.
Exxon and CNOOC Ltd, partners of Hess in the Guyana joint venture, are challenging the deal by claiming a right of first refusal to any sale of Guyana assets.
Hess owns 30% of Guyana’s giant Stabroek block operated by Exxon, which owns 45%. China’s CNOOC Ltd holds the remaining 25%. The companies expect to double production to 1.3 million barrels of oil and gas per day by 2027.
(Reporting by Sourasis Bose and Mrinalika Roy in Bengaluru; Editing by Anil D’Silva and Krishna Chandra Eluri)
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