Chevron CEO Seeks Peace With Exxon After Career-Defining Win

CEO of Chevron Corp. Mike Wirth Photo by Victor J. Blue /Bloomberg

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(Bloomberg) — Chevron Corp. Chief Executive Officer Mike Wirth is extending an olive branch to the Exxon Mobil Corp. CEO who waged a 16-month fight to derail the biggest deal of his career.

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Chevron’s victory in an international arbitration dispute initiated by Exxon allowed the $53 billion takeover of Hess Corp. to proceed, landing Wirth a highly coveted stake in one of the world’s premier oil discoveries in Guyana.

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The catch is that Exxon is the majority owner and operator of that project, which means two of the world’s largest oil behemoths must mend any lingering rifts and forge a new partnership. 

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For its part, Exxon indicated acceptance of Wirth’s peace offering, pledging Friday to “welcome Chevron to the venture.” The 30% stake in a tranche of Guyanese crude discoveries is the crown jewel of the Hess deal, which is by far the largest of Wirth’s seven-year tenure as CEO.

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“Partnership is one of our core values, and we pride ourselves on being a good partner around the world with many, many different companies,” Wirth said in a telephone interview. “We partner with Exxon on projects elsewhere in the world and have for many many years, and I’m sure we will find a way to move forward.”

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Exxon’s surprise March 2024 demand for arbitration to halt Chevron’s acquisition of Hess cast a long cloud over the suitor company and its share price, calling into question Wirth’s ability to amass sufficient undrilled oil reserves to bolster future production.

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Any such doubts have evaporated. Now, the former foes are almost certain to settle down into business as usual, which for international oil giants routinely involves multibillion-dollar partnerships to execute some of the riskiest ventures on the planet.

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“They are both big boys and they’re going to be just fine,” Andrew Gillick, managing director at research firm Enverus, said in an interview. 

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The companies already had longstanding partnerships in places like Kazakhstan and Australia, he noted. Besides, joint ventures are an essential feature of the most-ambitious oil developments because of the need to spread costs and risks, Gillick said.

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“No supermajor wants to do one of these projects on their own,” Gillick said. “The risk is too high historically.”  

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The legal clash was unprecedented in the modern history of Big Oil. Exxon, which discovered billions of barrels of crude in the Stabroek Block off the coast of Guyana, claimed it had a right of first refusal over Hess’s 30% stake. That argument ultimately failed to sway the arbitration panel. 

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“We welcome Chevron to the venture and look forward to continued industry-leading performance and value creation in Guyana for all parties involved,” Exxon spokesperson Todd Spitler wrote in an email.

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Wirth noted that he and Woods have chatted “from time to time” during industry events even as the arbitration process was underway.

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“I try to maintain a professional and respectful relationship with all my industry colleagues,” Wirth said. “I’m focused on whats best for Chevron and our shareholders and that’s really where my energy’s directed.”

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—With assistance from Kevin Crowley, Sonali Basak and Dani Burger.

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