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CGX Energy Inc V.OYL

Alternate Symbol(s):  CGXEF

CGX Energy Inc. is a Canada-based oil and gas exploration company. It is focused on the exploration of oil in the Guyana-Suriname Basin and the development of a deep-water port in Berbice, Guyana. The Company, through one of its subsidiaries, holds an interest in a Petroleum Prospecting Licence (PPL) and related Petroleum Agreement (PA) on the Corentyne block in the Guyana Basin, offshore Guyana. The Company, through its subsidiary Grand Canal Industrial Estates, is constructing the Berbice Deep Water Port. This facility, located on the eastern bank of the Berbice River, adjacent to and north of Crab Island in Region 6, Guyana, is being constructed on 30 acres with 400 m of river frontage. Its subsidiaries include CGX Resources Inc., GCIE Holdings Limited and CGX Energy Management Corp. It is the operator of the Corentyne block and holds a 27.48% working interest. Its Wei-1 exploration well is located west of the Kawa-1 discovery in the northern region of the Corentyne block.


TSXV:OYL - Post by User

Post by Devanand1on Apr 02, 2024 7:17am
240 Views
Post# 35964462

Chevron confident in securing Hess’ 30% stake in Stabroek Bl

Chevron confident in securing Hess’ 30% stake in Stabroek Bl

Kaieteur News – Chevron Corp. is optimistic in winning a stake in the prolific Stabroek Block following its purchase of Hess Corp. which it is hoping to finalise by mid-2024. Chevron said it is confident despite challenges by consortium partners, ExxonMobil and China National Offshore Oil Company (CNOOC).

Chevron takeover of Hess Corporation entails it assuming control of Hess’ stake in Stabroek, a significant offshore block. Currently, ExxonMobil operates the block with a 45 percent interest through Esso Exploration and Production Guyana Ltd., while Hess subsidiary Hess Guyana Exploration Ltd. (HEGL) holds a 30 percent interest. Additionally, China National Offshore Oil Corp’s CNOOC Petroleum Guyana Ltd. retains the remaining 25 percent.

ExxonMobil commenced arbitration proceedings on March 6 before the International Chamber of Commerce tribunal, arguing that a pre-emption right outlined in the Stabroek joint operating agreement (JOA) applies to Chevron’s acquisition of Hess. This right enables a partner to prevent a co-venturer from selling a stake to an outside party without first offering the stake to the partner.

Subsequently, ExxonMobil on March 11, and CNOOC, on March 15, filed for arbitration with opposing claims. These cases have been officially confirmed in filings with the U.S. Securities and Exchange Commission (SEC). To streamline the process, Hess revealed that CNOC agreed to consolidate the arbitration cases into one, with the authority administering the arbitration confirming the consolidation on March 26, 2024.

In a recent missive to its shareholders Hess said it remains resolute with Chevron to finalise their merger by mid-2024, despite the ongoing arbitral proceedings. In that letter addressed to shareholders and attached to a recent regulatory disclosure by Chevron, Hess asserted, “Chevron and Hess believe that the Stabroek ROFR does not apply to the merger due to the structure of the merger and the language of the Stabroek ROFR provisions.”

Furthermore, the company reiterated its intention to vigorously defend its position in the arbitration proceedings. It should be noted that if the arbitration does not yield a confirmation that the Stabroek ROFR is inapplicable to the merger and if an acceptable resolution is not reached among Chevron, Hess, Exxon, and/or CNOOC, the merger agreement’s closing condition would not be fulfilled. In such a scenario, Hess would remain an independent public company, retaining its participating interest in the Stabroek Block. The Stabroek Block is at present estimated at over 11 billion barrels of oil equivalent, with a number of appraisals underway for newer discoveries that will revise the proven crude reserves upwards. Regarding timelines and potential termination clauses, Hess clarified that either Chevron or Hess could terminate the merger deal if completion is not achieved by specified dates outlined in the agreement. Despite an initial end date set for April 18, 2024, both companies have waived the termination right associated with this date.

Hess has since also acknowledged the possibility of Guyanese authorities asserting approval over the merger, though as of the latest update, no such approval is anticipated. “As of the date of this proxy statement/prospectus, the parties do not anticipate that any such approval will be required from any Guyanese governmental body, agency or authority”, read the letter. Meanwhile, in the United States, both Chevron and Hess are actively working to navigate through the anti-trust review process by the Federal Trade Commission, as disclosed in the letter. Despite the complexities, Hess expressed confidence in the closure timeline. According to reports however, an internal email sent to employees on March 6, 2024, cautioned that the consummation could face delays due to the arbitration process.

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