New Guyana Discovery plays significant role US$3.7-billion spending plan for 2023
Fourth-quarter earnings this week saw American oil company, Hess Corporation soundly beat Wall Street estimates, as net income for the December 2022 fourth quarter amounting to US$624 million up from US$265 million for the same period in 2021.
This would amount to US$2.03 per common share. On an adjusted basis, fourth quarter earnings came in at $1.78 per share. With another discovery offshore Guyana, this has played a significant role in the company’s newly revealed US$3.7-billion spending plan for 2023.
Hess also returned US$405 million in cash to shareholders for the quarter, through a combination of dividends and US$310 million in buybacks. Guidance for the year has a net production forecast between 355,000 barrels of oil equivalent per day (boepd) and 365,000 boepd–up around 10 per cent from 2022.
Unveil an exploration budget
The results have prompted Hess to unveil an exploration budget of US$3.7 billion, the bulk (80%) of which will be spent on the Bakken and offshore Guyana. 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.