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Hess reports estimated results for Q4 2022 - announces Fangtooth SE-1 discovery offshore Guyana

25 Jan 2023

Key Developments:

  • Continued exploration success in 2023 on the Stabroek Block, offshore Guyana, with a significant new oil discovery at the Fangtooth SE-1 well located approximately 8 miles southeast of the original Fangtooth-1 discovery
  • The Fangtooth SE-1 well encountered approximately 200 feet of oil bearing sandstone reservoirs
  • Fangtooth adds to the block’s gross discovered recoverable resource estimate of more than 11 billion barrels of oil equivalent (boe) and has the potential to underpin a future oil development
  • The development plan for Uaru, the fifth development on the Stabroek Block, was submitted to the Government of Guyana for approval in the fourth quarter; the project is expected to have a capacity of approximately 250,000 gross barrels of oil per day (bopd) with first oil anticipated at the end of 2026
  • Entered into an agreement with the Government of Guyana for the purchase of high quality REDD+ carbon credits for a minimum of $750 million from 2022 through 2032; the long-term strategic partnership with the Government of Guyana aims to prevent deforestation and support sustainable development in Guyana
  • Completed the sale of the Corporation's interest in Libya for net proceeds of $150 million
  • Total cash returned to stockholders was $405 million in the quarter through dividends and share repurchases of $310 million

Fourth Quarter Financial and Operational Highlights:

  • Net income was $624 million, or $2.03 per common share, compared with net income of $265 million, or $0.85 per common share, in the fourth quarter of 2021; adjusted net income(1) was $548 million, or $1.78 per common share, in the fourth quarter of 2022
  • Oil and gas net production, excluding Libya, was 376,000 barrels of oil equivalent per day (boepd), up 27 percent from 295,000 boepd in the fourth quarter of 2021
  • E&P capital and exploratory expenditures were $818 million compared with $593 million in the prior-year quarter
  • Cash and cash equivalents, excluding Midstream, were $2.48 billion at December 31, 2022
  • Year-end proved reserves are estimated to be 1.26 billion boe; organic reserve replacement was 144 percent at a finding and development cost of approximately $14.80 per boe

2023 Guidance:

  • Net production is forecast to be in the range of 355,000 boepd to 365,000 boepd, which is an approximate 10 percent increase from 2022, proforma for assets sold
  • E&P capital and exploratory expenditures are expected to be approximately $3.7 billion, of which more than 80 percent will be allocated to Guyana and the Bakken
Photo - see caption

Hess reported net income of $624 million, or $2.03 per common share, in the fourth quarter of 2022 compared with net income of $265 million, or $0.85 per common share, in the fourth quarter of 2021. On an adjusted basis, the Corporation had net income of $548 million or $1.78 per common share in the fourth quarter of 2022. The improvement in adjusted after-tax earnings compared with the prior-year period was primarily due to increased sales volumes in Guyana in the fourth quarter of 2022.

'Our strategy is to grow our resource base, deliver a low cost of supply and generate industry leading cash flow growth – and at the same time maintain our industry leadership in environmental, social and governance performance and disclosure,' CEO John Hess said. 'Our successful execution of this strategy has uniquely positioned our company to deliver significant value to shareholders by both growing intrinsic value and growing cash returns.'

(1) 'Adjusted net income' is a non-GAAP financial measure.

Click here for full announcement

Source: Hess

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