Offshore staff
NEW YORK – Hess Corp. has reported an E&P capital and exploratory budget of $2.9 billion for 2019.
Of this, about 75% will be allocated to high return growth assets in the Bakken andGuyana.
The $2.9 billion capital and exploratory budget is allocated as follows: $1,890 million (65%) for production, $570 million (20%) for offshore developments and $440 million (15%) for exploration and appraisal activities.
The operator forecasts net production to average between 270,000 and 280,000 boe/d in 2019, excluding Libya, compared to approximately 245,000 boe/d in 2018 proforma for the sale of the company’s joint venture interests in the Utica shale play.
CEO John Hess said: “Our capital and exploratory expenditure program is designed to deliver strong returns, production growth, and significant future free cash flow. As we focus spending on our high return investment opportunities, we will continue to reduce our unit costs to drive margin expansion and improve profitability.”
For production, the company has allocated $1.425 billion to fund an increase to six rigs, from an average of 4.8 rigs in 2018, and the shift to higher intensity plug and perf wells in the Bakken. The company expects to drill approximately 170 new wells and to bring online approximately 160 new wells in 2019. Funds are also included for investment in non-operated wells.
It has allocated $290 million for production operations in thedeepwater Gulf of Mexico, including continued development of the Stampede field (Hess 25% and operator) and tieback opportunities at the Llano field (Hess 50%) and Tubular Bells field (Hess 57% and operator).
The company has allocated $150 million for production activities in the Gulf of Thailand atNorth Malay Basin (Hess 50% and operator) and the Malaysia/Thailand Joint Development Area (Hess 50%).
For developments, it has assigned $260 million for theLiza Phase 1 development offshore Guyana (Hess 30%), where first production is expected by 2020. Also, $310 million includes spend for Liza Phase 2 development, completing the plan of development for Payara, and front-end engineering and design work for future development phases.
COO Greg Hill said: “InGuyana, 2019 will be the peak spend year for the Liza Phase 1 development, which is on track for first oil by early 2020. We also will begin Liza Phase 2 development spending, complete the plan of development for Payara, and advance front-end engineering and design work for future development phases.”
As for exploration and appraisal, the company has assigned $440 million to drill wells on theStabroek block offshore Guyana (Hess 30%). Funds are also included for seismic acquisition and processing in Guyana, Suriname, and the deepwater Gulf of Mexico, and for license acquisitions.
12/10/2018
