US energy corporation's earnings outshine with new Guyana discovery

WORLD  27 January 2023 - 04:04

Fourth-quarter earnings on January 25 saw US enery corporation - Hess (NYSE:HES) soundly beat Wall Street estimates, with another discovery offshore Guyana playing a significant role in the company’s newly revealed $3.7-billion spending plan for 2023. 

In its Q4 2022 financial and operational highlights, Hess reported net income of $624 million ($2.03 per common share), up from $265 million net income for the same period in 2021. On an adjusted basis, Q4 earnings came in at $1.78 per share, Oilprice.com reports.

Hess also returned $405 million in cash to shareholders for the quarter, through a combination of dividends and $310 million in buybacks. 

Guidance for the year has a net production forecast between 355,000 boepd and 365,000 boepd–up around 10 per cent from 2022. 

The results have prompted Hess to unveil an exploration budget of $3.7 billion, the bulk (80 per cent) of which will be spent on the Bakken and offshore Guyana.

Guyana is the star of the show, with discoveries with partner Exxon lining up one after another.

In its Q4 earnings call, Hess announced another discovery on the Stabroek Block at the Fangtooth SE-1 well, which is just southeast of the Fangtooth-1 discovery. Drilling encountered some 200 feet of oil-bearing sandstone reservoirs. The Stabroek Block has a gross discovered recoverable resource estimate of more than 11 billion barrels of oil without the latest Fangtooth discovery.  

The Fangtooth SE-1 discovery would likely justify the addition of a seventh platform in Guyana, and the combined discoveries at Stabroek represent the world’s biggest offshore discoveries in more than 10 years. 

With regard to American shale, where Hess is focused on the Bakken, the company said that the United States could increase total oil production to up to 13.5 million bpd, at which point output would plateau somewhere around 2025 or 2026.

Caliber.Az