Chevron boosts offer for Unocal

LOS ANGELES – The Chinese oil and gas company seeking to buy Unocal Corp. said Wednesday it would stick by its current bid – even after Unocal’s board endorsed a sweetened offer from rival bidder Chevron Corp.

Chevron boosted its cash and stock offer by about $2.50 per share to $63 per share – or $17 billion overall – shortly before the Unocal board met Tuesday night.

CNOOC, an affiliate of China National Offshore Oil Corp., has an $18.5 billion offer on the table for the El Segundo-based company. The deal has met stiff opposition in Congress because CNOOC is 70 percent owned by the Chinese government.

Analysts said CNOOC will likely have to increase its offer and add a substantial financial guarantee if it wants to persuade Unocal shareholders to reject the Chevron bid in a vote scheduled for Aug. 10.

Some analysts said the Chevron bid is superior and should prevail despite its lower value because it carries fewer “closing risks” and is backed by the Unocal board.