Chevron Closes Hess Deal After Winning Exxon Fight

Well, we're pleased with the decision that came out of the arbitration panel this morning. We're also pleased with the decision that came out of the FTC yesterday regarding John Hess's eligibility to serve on Chevron's board. And this really helps create a premier international oil and gas company. We are one of the largest producers in the world. We have the highest cash margin in our upstream business of anybody. We're the largest producer of oil and gas in the United States, largest leaseholder in the deepwater Gulf of America, and have industry-leading free cash flow over not just the next couple of years, but out into the next decade now as we combine with Hess. So it's good for us. It's also good for our industry because this was a transaction that kind of, as you say, impacted our investors — the uncertainty hung over the industry a bit because the question about what would it mean for potential future transactions is one that people were paying close attention to. And so I think having that resolved and affirming the industry practice that asset-level rights of first refusal don't apply in a corporate-level M&A transaction is one that's going to be very important for our industry.

Well, we work with people all around the world. Our industry is built on partnership because the scale of our investments usually requires partners to help share risk. We also pool technical resources in order to develop some of these challenging opportunities. And so partnering is very familiar to us. It's a core value. We take great pride in our ability to be a good partner around the world. We work with Exxon in other places around the world and have for many years, in Guyana in particular. Most of the people that will be involved in this are going to be legacy Hess employees who've got years and years of history working together with Exxon on this project. There are good working relationships at that level, and all three companies have worked together to create the incredible value that is seen in Guyana and the prospects for the future. So I expect that those relationships will continue to be good.

Well, you know, we see each other at industry functions and the like. And so we speak from time to time. But there's been a sharp difference of opinion. We believe that the plain reading of this contract, which is a confidential document, was very clearly, as I described earlier, that a right of first refusal would exist if there were a transaction at the asset level, but not at the corporate level. The arbitration panel has affirmed that interpretation. And so we'll move forward from here. But look, it didn't have to take this long. I wish it would have gone differently. We tried early on to find a way to resolve this and thought we were working together in good faith. And then abruptly we're notified that the other parties had decided they want to resolve this through arbitration. At that point, we believed we had the right side of this argument. We had to stand up for that, and that's taken some time.