The second-largest oil company in the U.S., Chevron, announced that it will buy independent energy company Hess Corp for $53 billion.
The corporation has crude oil and natural gas production in Guyana, the North Dakota Bakken Shale play, the deepwater Gulf of Mexico, and the Gulf of Thailand.
The news comes weeks after rival Exxon Mobil acquired Natural Resources for $7 billion more at $60 billion.
Guyana has become the third-largest oil producer in Latin America, following Brazil and Mexico.
With this, Exxon and Chevron come in direct competition with each other as they battle to develop drilling in Guyana once the deal closes in 2024.
Chevron expects its production and cash flow to grow, based on its current five-year guidance. CEO John Hess will join the Chevron board.
Investors will get 1.025 Chevron shares for each Hess share they hold, or $171 per share. The total deal value comes to about $60 billion, including debt.
These acquisitions are because oil markets are being stretched out. There have been cutbacks in production in Russia and Saudi Arabia.