Hess to focus on projects development offshore Guyana

26 January 2021 (Last Updated January 26th, 2021 09:25)

Oil and gas company Hess Corporation has allocated $1.9bn of its 2021 exploration and production capital and exploratory budget for project developments offshore Guyana and the Bakken.

Hess to focus on projects development offshore Guyana
Hess intends to focus on projects offshore Guyana. Credit: gloriaurban4 from Pixabay.

Oil and gas company Hess Corporation has allocated $1.9bn of its 2021 exploration and production capital and exploratory budget for project developments offshore Guyana and the Bakken.

Of the total budget, $670m (35%) has been allocated for production, $780m (41%) for offshore Guyana developments, and $450m (24%) for exploration and appraisal activities.

In 2021, the firm estimates net production to average approximately 310,000 barrels of oil equivalent per day, excluding Libya.

Hess Corporation CEO John Hess said: “The majority of our 2021 budget is allocated to Guyana, where our three sanctioned oil developments have a Brent breakeven oil price of between $25 and $35 per barrel, and to the Bakken, where we have a large inventory of future drilling locations that generate attractive financial returns at current prices.

“By investing only in high-return, low-cost opportunities, we have built a differentiated portfolio of assets that we believe will provide industry-leading cash flow growth over the course of the decade.”

Hess Corporation chief operating officer Greg Hill said: “In the Bakken, we plan to add a second rig during the first quarter, which will allow us to sustain production and cash flow generation from this important asset.”

The firm plans to invest $25m for the Liza Phase 1 development on the Stabroek Block in Guyana (Hess 30%). In December, the Liza Phase 1 produced 120,000 gross barrels of oil per day.

The company also allocated $450m for the Liza Phase 2 development offshore Guyana with a capacity of up to 220,000 gross barrels of oil per day. Production is planned to commence in early 2022.

A further $235m is assigned for the Payara development offshore Guyana with a capacity of up to 220,000 gross barrels of oil per day. First oil production is planned in 2024.

The firm will invest a further $70m for front-end engineering and design work for future development phases on the Stabroek Block.

Hess will also invest $450m to drill 12 to 15 exploration and appraisal wells on the Stabroek Block.

This includes well planning on Block 42 in Suriname (Hess, 33.3%) and seismic acquisition and processing in Guyana and the Deepwater Gulf of Mexico.

Last year, Hess Corporation completed the sale of its 28% working interest (WI) in the Shenzi field for a total consideration of $505m.