*

Exxon claims right of first refusal to buy Hess' Stabroek

stake

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Stabroek field is biggest oil discovery of the last decade

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Hess acquisition crucial for boosting Chevron's ( CVX ) oil output

and

reserves

By Sheila Dang

HOUSTON, May 1 (Reuters) - The Paris-based International

Chamber of Commerce has scheduled a hearing in Exxon Mobil's ( XOM )

arbitration dispute over rival Chevron's ( CVX ) planned

acquisition of oil producer Hess for May 26, according

to two sources familiar with the matter.

The battle between Exxon and Chevron ( CVX ), the two largest U.S.

oil producers, centers on the lucrative Stabroek oilfield off

the coast of Guyana, the biggest oil discovery of the past

decade.

The dispute has delayed Chevron's ( CVX ) $53-billion deal to buy

Hess, which was announced nearly 18 months ago.

While Exxon, Chevron ( CVX ) and Hess have previously said the

hearing in the arbitration case was scheduled for May, the date

has not previously been reported. The sources declined to be

named because the details are confidential.

A Hess spokesperson referred to a previous filing in which

the company said it expected a decision in the third quarter.

Exxon and Chevron ( CVX ) did not respond to requests for comment.

The prize asset in Chevron's ( CVX ) acquisition of Hess is the latter's

30% stake in the Stabroek block. Exxon operates the field and

holds a 45% interest. CNOOC, the third partner,

holds 25%.

In March last year, roughly four months after Chevron ( CVX ) said it

would buy Hess, Exxon and CNOOC filed arbitration claims,

arguing that their joint operating agreement in the Stabroek

block gives them a right of first refusal to buy Hess' stake.

Chevron ( CVX ) and Hess claim the right of first refusal does not apply

to their merger.

The arbitration case was filed through the International Chamber

of Commerce and a three-judge panel will consider the

applicability of the right-of-first-refusal clause.

While the ICC is based in Paris, it is unclear where the May

26 hearing will take place. The arbitration rules on the ICC's

website state that hearings can take place in-person or

virtually.

Closing the acquisition of Hess and gaining access to the

Stabroek is crucial for Chevron ( CVX ). The field has pumped more crude

than initially expected and would provide a material boost to

Chevron's ( CVX ) total oil output. It would also add to Chevron's ( CVX ) oil

and gas reserves, which fell to their lowest point in at least a

decade at the end of 2024.

The block is estimated to hold more than 11 billion barrels

of oil equivalent in recoverable resource.

In March, Chevron ( CVX ) disclosed that it bought 4.99% of Hess' common

shares on the open market, which the company said reflected its

confidence in completing the acquisition.