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Venzuela and Guyana agreed that the countries will not use force over the disputed Essequibo oil-rich region.
The countries announced the agreement at a press conference after a meeting earlier Thursday between the Guyanese President and Venezuela President Nicolás Maduro on the eastern Caribbean island of St. Vincent.
The countries “agreed that Guyana and Venezuela, directly or indirectly, will not threaten or use force against one another in any circumstances, including those consequential to any existing controversies between the two states,” according to a statement made at the press conference on Thursday evening.
The countries agreed to form a joint commission of foreign ministers from the two states to address matters and provide an update to the presidents of the countries within three months.
Venezuela and Guyana are dedicated to maintaining peace in their shared region, Guyanese President Ali said on Thursday.
Venezuela’s President Maduro recently ordered state-owned energy and mineral companies to begin granting exploration licenses for deposits in the oil-rich region and claimed he ordered foreign oil companies working in Essequibo to withdraw, although he has not sent any military forces to carry out his demands.
The controversy between the countries comes as oilfields off the Guyana coast that Chevron (NYSE:CVX) bought into via its planned $53 billion takeover of Hess (NYSE:HES), which partners with Exxon Mobil (NYSE:XOM) in Guyana, could be in jeopardy because of Maduro’s threat.
Venezuela and Guyana’s border dispute isn’t likely to escalate into a military conflict amid the previous hostile statements by the South American countries, Chevron’s chief executive said Monday, according to a Bloomberg report.
Last week Exxon Mobil (XOM) CEO Darren Woods said that the dispute between Venezuela and Guyana over Guyana’s Essequibo region likely won’t be resolved for a couple years.
Some investors are concerned that the Guyana dispute may be problematic for Chevron’s (NYSE:CVX) planned $53 billion purchase of Hess (HES).
The Hess/Chevron gross deal spread narrowed to $10.56 on Thursday from a high of $13.75 a week ago.