Hess Expects Higher 2023 Spending with Focus on Guyana, Bakken

(Reuters) U.S. oil and gas producer Hess Corp on Tuesday forecast higher Exploration & Production (E&P) capital and exploratory budget of $3.7 billion for 2023, of which more than 80% would be allocated to Guyana and North Dakota’s Bakken shale field.

The company forecast 2022 E&P capital and exploratory expenditures of about $2.7 billion.

The oil and gas producer is part of a consortium which includes Exxon Mobil Corp that operates in Guyana, one of the world’s hottest oil drilling zones.

Hess said 39% of the $3.7 billion budget is allocated for production, 46% for offshore Guyana developments, and 15% for exploration and appraisal activities.

The company added that $90 million was allocated to the Liza Phase 1 and Phase 2 developments on the Stabroek Block offshore Guyana, which are currently operating at a combined gross production capacity of more than 360,000 barrels of oil equivalent per day (boepd).

Additionally, it said $1.21 billion would be allocated for the developments on Stabroek Block’s Payara, Yellowtail, and Uaru projects.

In the Bakken shale field, Hess said it plans to operate a four-rig program, helping the company to maximize free cash flow generation and further reducing unit costs.

Hess expects its net production to average between 355,000 and 365,000 boepd in 2023, compared with its forecast of 325,000 boepd in 2022. In 2023, net production at Bakken is expected to average between 165,000 and 170,000 boepd and about 100,000 barrels of oil per day in Guyana.

The New York City-headquartered company is scheduled to report fourth-quarter results on Wednesday, Jan. 25.

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