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James Burgess

James Burgess

James Burgess studied Business Management at the University of Nottingham. He has worked in property development, chartered surveying, marketing, law, and accounts. He has also…

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Hess to Invest $5.8bn in Oil & Gas Development

US-based Hess Corporation (HES) has unveiled a $5.8 billion exploration and production budget for this year, with a focus on unconventional shale resources and big drilling plans in Africa.

Hess will spend $2.85 billion this year on developing unconventional shale resources, along with $1.475 billion on production, $925 million on development and $550 million on new exploration.

While much focus is on the US side of the Hess portfolio, particularly the Bakken and Utica shale plays and the Tubular Bells Field in the deepwater Gulf of Mexico, the company is also eyeing expansion in Ghana and Kurdistan.

In Ghana, Hess plans to drill three appraisal wells and perform a drill stem test on the Deepwater Tano/Cape Three Points block, in which it is the operator with a 90% interest.

In the Kurdistan Region of Iraq, Hess plans to complete drilling at two wells at the Dinarta and Shakrok blocks this year. Hess is the operator of these two blocks, with an 80% interest.

"In 2010, we began focusing our portfolio around lower-risk, higher growth assets in regions where we have a distinct competitive advantage. Our transformation accelerated rapidly in 2013 and we have successfully positioned Hess for long term growth, cash generation and strong, sustainable returns for our shareholders,” Hess CEO, John Hess said in a statement.

The 2014 budget also includes development of the North Malay Basin Project in Malaysia, ongoing drilling at the Valhall Field in Norway, the South Arne Field in Denmark, Block G in Equatorial Guinea, Block A-18 in the Join Development Area in the Gulf of Thailand, and the Shenzi Field in the deepwater Gulf of Mexico.

Hess will sink another $2.2 billion into development at Bakken and another $550 million into drilling 35 wells in Utica.

Earlier this week, Hess announced it had agreed to sell 74,000 acres of its dry natural gas holdings in the Utica shale in Ohio for $924 million to an undisclosed buyer.

According to Hess’ Q4 2013 results, the integrated oil company came in with earnings of 96 cents per share—slightly underperforming due to a drop in production volumes. Full-year 2013 earnings were $5.55 per share, down about 5.5% from the year before.

Hess’ total revenues for 2013 were up 1.4%.

By. James Burgess of Oilprice.com

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