Chevron said on Monday it had reached a deal to buy a $53 billion stake in Hess, the second proposed megamerger among major U.S. oil players after Exxon Mobil offered $60 billion for Pioneer Natural Resources earlier this month, Reuters reported.

The proposed deal increases competition between Chevron, the second-largest U.S. oil and gas producer after Exxon, by putting the group in direct competition with its larger rival to develop drilling in Guyana, where the oil industry is booming.

The deal also signals Chevron’s plans to continue increasing investment in fossil fuels as demand for oil remains strong and major producers use purchases to replenish supplies after years of underinvestment.

Chevron offered 1.025 of its shares for each share Hess owns, or $171 per share, representing a premium of about 4.9% to the last close.

The total value of the deal is $60 billion including debt.