The stock of Hess Corporation experienced a significant decline on Thursday, marking the largest drop in value they have seen in 20 months. This downturn is believed to stem from the postponement of the company’s planned sale to Chevron Corporation. This delay is a result of an arbitration process initiated to resolve Exxon Mobil’s challenge to the $53 billion deal.
The arbitration hearing, related to complaints from Exxon Mobil and CNOOC Ltd regarding priority rights to Hess’s valuable stake in a partner’s oil production in Guyana, is now scheduled for next May. As a result, the completion of the Chevron acquisition, which was originally planned for earlier this year, is currently projected to take place in the latter half of 2025.
On Thursday, the impact on Hess’s stock was evident, with a drop of $11.25, equivalent to a 7.35% decrease. This percentage decline marks the most significant drop in a day since November 2022. Meanwhile, Chevron’s stock also witnessed a decline, with a 4% decrease, equivalent to $6.57, falling to $153.93 in midday trading on the New York Stock Exchange.
The challenge from Exxon and CNOOC presents a significant obstacle on the path to Chevron’s largest acquisition in over two decades. The outcome of this arbitration will be pivotal in determining the fate of the proposed sale.
This article was contributed by Reuters.
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