Hess reports $5.8 billion capital budget for 2014

Hess Corp. reported that its exploration and production capital budget for 2014 is expected to reach $5.8 billion, almost half of which, $2.85 billion, will be spent on unconventional shale resources.

The remainder of the budget will go toward production at $1.475 billion, developments at $925 million, and exploration at $550 million.

“We are committed to ensuring that our capital and exploratory budget enables our goal of achieving 5-8% compound average production growth through 2017 while generating the highest possible risk adjusted returns,” said John Hess, Hess chief executive officer.

Unconventional budget

Greg Hill, Hess president and chief operating officer, added, “Our expenditures in the Bakken are planned to be $2.2 billion in 2014, flat with 2013. However, as a result of lower well costs and decreased investments in infrastructure projects we plan to operate 17 rigs vs. 14 last year and to bring 225 new operated wells online in 2014 compared to 168 in 2013.”

Hill continued, “In addition, we plan to increase our expenditures in the emerging Utica shale play to $550 million from $455 million last year, as we focus our activities on the appraisal and development of the wet gas window.”

Of the $2.85 billion purposed for unconventional plays, $2.2 billion will be used for the development of the Bakken shale in North Dakota.

Hess in 2013 reported a $6.7 billion E&P budget, 40% of which was to be dedicated to unconventional oil and gas plays. The Bakken was subject to receive $2.2 billion, down from $3.1 billion in 2012 (OGJ Online, Jan. 11, 2013).  

Hess plans to operate 17 rigs and bring 225 new operated wells online while investing $350 million on major projects, including the completion of the expansion of the Tioga gas plant and associated pipeline and compression projects.

The wet gas window of the Utica shale play in Ohio will be the target of 35 new wells at a cost of $550 million.

Hess in September agreed to terms with PVR Partners LP for the latter to build, own, and operate a 45-mile natural gas trunkline and associated gathering pipelines and equipment serving Hess’s lean gas production in the Utica (OGJ Online, Sept. 4, 2013).

E&P budget

The remaining 51% of the company’s 2014 budget will be used for production, development, and exploration around the world.

Hess’s production budget is expected to reach $1.475 billion, divided among Equatorial Guinea, Norway, the Gulf of Thailand, Denmark, and the deepwater Gulf of Mexico.     

The company’s $925 million development budget includes start-up of the Tubular Bells field in the deepwater gulf and full field development of the North Malay basin project

Hess’s $550 million exploration budget encompasses Ghana, Iraqi Kurdistan, and deepwater gulf.

Last year, Hess undertook a large scale divestiture to repay debt and strengthen its balance sheet, during which the company parted with its energy marketing units, Russian subsidiary Samara-Nafta along with interests in the Pangkah and Natuna A assets offshore Indonesia, Beryl field in the UK North Sea, the Eagle Ford play in Texas, and the Azeri, Chirag, and Guneshli fields in Azerbaijan (OGJ Online, Dec. 2, 2013).

Related Articles

AER strengthens air quality requirements for Peace River operators

08/19/2014 Addressing emissions and odors, Alberta Energy Regulator says it has strengthened requirements to capture casing and tank top gas from heavy oil an...

BlackPearl files OSCA application for Blackrod SAGD

08/19/2014 Alberta Energy Regulator reports that BlackPearl Resources Inc., Calgary, has filed an Oil Sands Conservation Act application for the Blackrod comm...

MARKET WATCH: NYMEX, Brent oil prices continue slump

08/19/2014 Oil prices slid on the New York market Aug. 18 while oil prices on the London market slumped to the lowest level since June 25, 2013, after Iraqi a...

CSB releases incident report for Tesoro’s Martinez refinery

08/18/2014 Loose pipe fittings are to blame for a sulfuric acid release that seriously injured two workers in early February at the alkylation unit of Tesoro ...

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected