Hess earmarks bulk of 2020 spend to Guyana, Bakken

Hess Corp. will allocate more than 80% of its 2020 exploration and production capital and exploratory budget of $3.0 billion to high return investments in Guyana and the Bakken, the company said Jan. 28.

The company plans to spend $1.69 billion (56%) for production, $860 million (29%) for offshore Guyana developments, and $450 million (15%) for exploration and appraisal activities.

Production

The majority of the production budget—$1.375 billion—will fund a 6-rig program in the Bakken where the company expects to drill 170 new wells and to bring online 175 new wells this year. Funds are also included for investment in non-operated wells.

Production operations in the deepwater Gulf of Mexico—which includes development of the Hess-operated Esox-1 tieback (57.14%) will see $135 million (OGJ Online, Oct. 29, 2019).

Another $170 million is allocated for production activities at Hess-operated North Malay Basin (50%) and the Malaysia/Thailand joint development area (50%) in the Gulf of Thailand.

Net production is forecast to average 330,000-335,000 boe/d in 2020, excluding Libya. Bakken net production is forecast to average 180,000 boe/d in 2020.

Developments

The company has earmarked $100 million for Liza Phase 1 development offshore Guyana (30%), where first production was achieved in December 2019. Another $400 million is expected to go to Liza Phase 2 development, where first production is expected by mid-2022.

Some $360 million is expected to progress development plans for Payara field, where production is expected as early as 2023, and for front end engineering and design work for future developments (OGJ Online, Nov. 14, 2019).

Exploration and appraisal

The company expects to spend $450 million to drill exploration and appraisal wells on the Stabroek and Kaieteur Blocks offshore Guyana (Hess 30% and 15%, respectively) and two exploration wells in the Gulf of Mexico. Funds are also included for seismic acquisition and processing in Guyana, Suriname, and the deepwater Gulf of Mexico, and for license acquisitions.

Source: OGJ