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FTC cracks down on oil megamergers, taking aim at top

executives

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Chevron-Hess deal can go ahead without John Hess board

offer

(Rewrites throughout with sourcing, background and links)

HOUSTON, Sept 26 (Reuters) - U.S. antitrust regulators

will bar Hess CEO John Hess from taking a board seat as a

condition of its go-ahead of oil producer Chevron's ( CVX ) $53

billion purchase of Hess, people close to the matter

said.

The Federal Trade Commission's consent for the deal will not

allow Hess to become a board member, the people said, without

explaining why the ban was imposed.

Chevron's ( CVX ) proposed all-stock acquisition of Hess, first

announced in October, was one of a string of

multi-billion-dollar U.S. oil and gas industry deals that began

with Exxon Mobil's ( XOM ) purchase of Pioneer.

In a crackdown on the megamergers, the FTC similarly

barred Pioneer Natural Resources CEO Scott Sheffield from taking

a seat on Exxon board as a

condition of its approval

earlier this year of their $60 billion merger.

It was not immediately clear if Hess would be allowed to

take another position at Chevron ( CVX ). He recently joined the board

of financial firm Goldman Sachs ( GS ).

Neither Hess nor Chevron ( CVX ) immediately replied to requests for

comment. The FTC declined to comment.

Hess and Chevron ( CVX ) shares each fell 1% in midday trading.

The expected go-ahead would leave Exxon's challenge to the

Chevron-Hess deal as its final hurdle. Exxon and China's CNOOC

Ltd have filed an arbitration case that could block

the deal, claiming the merger is a ploy to gain Hess's lucrative

Guyana assets.

Hess owns 30% of Guyana's giant Stabroek offshore block,

which has been the site of more than 30 oil and gas discoveries

since 2015. Exxon, which is the operator of the block owns 45%

and CNOOC owns 25%.

Bloomberg News earlier reported the FTC would block Hess

from taking a board seat on the combined company.

In the Exxon merger, the FTC alleged that Sheffield had

colluded with other U.S. oil firms and with the Organization of

the Petroleum Exporting Countries "to keep production

artificially low" and increase oil companies' profits.

The FTC had pointed to meetings that shale and OPEC

officials held over several years, including a series of private

dinners at a Houston energy conference.