Hess Corp. revised its 2020 capital and exploratory budget to $2.2 billion, an $800-million reduction from the previous budget (OGJ Online, Jan. 28, 2020). The company will reduce its budget primarily by shifting from a six-rig program to one rig in the Bakken shale, a move it expects to have completed by end-May 2020. Most discretionary exploration and offshore drilling activities, excluding its work in Guyana, will also be deferred.
The company now forecasts net production for 2020 to average 325,000-330,000 boe/d, excluding Libya, versus previous guidance of 330,000-335,000 boe/d. Hess’s Bakken net production is forecast to average 175,000 boe/d in 2020, versus previous guidance of 180,000 boe/d.
Hess also entered into a $1-billion, 3-year term loan agreement with JPMorgan Chase Bank NA. The term loan contains provisions that require the company to reduce JPMorgan’s initial funded amount, which the company intends to do by syndicating the loan to other banks.
In addition, the company entered 2020 with more than $1.5 billion in cash and cash equivalents on its balance sheet and has a $3.5 billion undrawn revolving credit facility and no material debt maturities until 2027.
