Dr. Jagdeo says amid Chevron’s takeover of Hess; affirms oil giant has been ‘examined carefully’

GUYANA’S carbon credit sale to oil giant Hess Corporation will remain ‘intact’ amid the purchase of the company’s shares by Chevron, an American multinational energy corporation.
This was revealed by General Secretary of the governing People’s Progressive Party (PPP), Dr. Bharrat Jagdeo, at a press conference on Thursday.
He told reporters that Chevron will be a great addition to Guyana’s oil and gas sector, noting that the company has been “examined carefully” and the agreement between Hess and Guyana on the sale of carbon credits will remain the same.

The Architecture for REDD+ Transactions (ART), in December 2022, issued the world’s first TREES credits to Guyana.
This paved the way for a historic agreement between Hess Corporation and the Government of Guyana, whereby the oil giants opted to purchase about one-third of all Guyana’s credits (issued and anticipated) up to 2030.

MAJOR OIL COMPANIES
“We are pleased that there are two major oil companies here,” Jagdeo said, adding: “Recently I have seen a lot of public reports globally and here locally about the recent takeover of Hess International by Chevron…the fact that Guyana is mentioned in almost every one of those international news reports demonstrates how far we have come and the importance of our growing importance of our country in the global market supply for crude oil,” Dr. Jagdeo said.
He reiterated that Guyana is becoming an attractive destination for investments with ExxonMobil already operating in the country, and Chevron now looking to enter the country’s lucrative market.

“You have seen globally now a move by Exxon and Chevron, two of the biggest companies in the United States of America, moving to consolidate and also to grow their crude assets, and they are doing so and investing more substantial sums of money in acquiring new assets because they are calculating that the global demand for fossil fuel will stay with us for a long time in the future,” Dr. Jagdeo said.

ExxonMobil initiated oil and gas exploration activities in Guyana in 2008, collecting and evaluating substantial 3D seismic data that led to the company safely drilling its first exploration well, Liza-1, in 2015. Fast forward to 2023, production is ongoing and more projects are expected to come on stream in the lucrative Stabroek Block.
The Stabroek Block is 6.6 million acres (26,800 square kilometres). ExxonMobil affiliate, Esso Exploration and Production Guyana Limited, is operator and holds 45 per cent interest. Hess Guyana Exploration Ltd. holds 30 per cent interest and CNOOC Petroleum Guyana Limited holds 25 per cent interest.

On Monday, Chevron announced its strategic move to purchase the outstanding shares of Hess Corporation in an all-stock transaction.
The acquisition marks a significant upgrade and diversification of the company’s portfolio, and includes Hess’ holdings in the Stabroek Block in Guyana; this is considered as an asset of immense value characterised by industry-leading cash margins and low-carbon intensity.

This acquisition is set to position Chevron for substantial production growth in the coming decade.
The acquisition offers a strong strategic fit for the company, granting the company 30 per cent ownership in the Stabroek Block, which represents more than 11 billion barrels of oil equivalent.

This move promises high cash margins, robust production growth, and potential exploration opportunities. The transaction is also anticipated to boost Chevron’s cash flow per share in 2025, driven by synergies and the start-up of a fourth floating production storage and offloading (FPSO) vessel in Guyana.