Hess reviews timeline for Chevron deal closing after Exxon escalates Guyana dispute

Hess Corp. is reviewing the timeline for when its merger with Chevron will close after Exxon Mobil this week escalated a dispute over lucrative oil assets in Guyana.

Exxon filed for arbitration Wednesday to defend what the oil major views as its right to make a counter offer for Hess' Guyana assets under a joint operating agreement.

"We disagree with ExxonMobil's interpretation of the agreement and are confident that our position will prevail in arbitration," Hess told employees in an email Wednesday.

"In light of today's development, we are reviewing the expected timeline for legal closing and will provide further detail in our next merger update," Hess wrote.

Chevron entered an agreement in October to purchase Hess for $53 billion, in a play to gain a foothold in Guyana's massive offshore oil resources.

Hess is part of a consortium with Exxon and China National Offshore Oil Corporation that operates the Stabroek oil block, a massive offshore resource with an estimated 11 billion barrels of oil and gas.

Hess has a 30% stake in the Stabroek block. Exxon leads the project with a 45% stake while CNOOC maintains 25% stake.

Chevron warned investors in a filing last week that the deal with Hess would terminate if an arbitration court rules that Exxon has a right of first refusal. If that scenario played out, Hess would continue to operate as an independent company and retain its stake in the Guyana assets, according to Chevron's filing.

Chevron has maintained that the joint operating agreement does not apply to its merger with Hess.

Exxon Senior Vice President Neil Chapman said Wednesday that the oil major is "extremely confident in our position that pre-emption rights exist in this contract." Arbitration disputes can take up to six