US independent Hess will increase its 2017 exploration and production (E&P) budget, turning its attention to activity offshore Norway, Guyana, and the Gulf of Mexico, the company announced on 12 January.
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Image from Hess. |
The company’s has set a budget of US$2.25 billion, an 18% increase compared to its 2016 actual spend of
Hess will allocate $375 million (17%) for production,
Hess expects its 2017 production forecast to average between 300,000-310,000 boe/d, excluding
Increased capital was included for development activities at the ExxonMobil-operated Liza field in
Production is anticipated to jump 8-12% from the beginning of 2017 to the end of the year, partly as a result of the restart of drilling at Valhall, and start-up of
Hess said that $375 million will be used primarily for production activities in the deepwater Gulf of Mexico, including the drilling and completion of a production well at the Penn State field (Hess-operated, 50%) and for operations at the AkerBP-operated Valhall Field in Norway (Hess, 64%), where drilling will restart in late Q1 2017.
“We plan to resume drilling at the Valhall Field from the existing platform rig and we will continue to progress our two offshore developments to first production, which will add a combined 35,000 boe/d once online," said Hess president and COO Greg Hill.
In its development budget, the company has allotted $425 million for its Stampede field, in the deepwater Gulf of Mexico, in order to drill two wells, complete three wells, install the tension leg platform, and progress development to be able to achieve first oil in 2018. Jerry Lee profiled the Stampede field in the January 2017 issue of OE.
Hess will use $275 million to complete initial full field development of the North Malay Basin in Malaysia (50%, operator).
The firm will also put up a total of $125 million for development activities at Liza in Guyana, where Hess has a 30% stake. On 12 January, Exxon and Hess announced that the appraisal drilling at Liza-3 identified an additional high quality, deeper reservoir directly below the Liza field, which is estimated to contain between 100-150 MMboe.
Hess will also use $350 million to drill wells on the Stabroek Block offshore Guyana that include appraising Liza, the recent Payara discovery, and new exploration prospects. Additional funds are included for seismic acquisition and processing and for license acquisitions.
“Our 2017 budget reflects our balanced approach to investing in short cycle and long cycle growth options while maintaining our financial flexibility,” CEO
During Q4 2016, Hess made the decision to defer further development of the Equus natural gas fields on blocks WA-390-P and WA-474-P (Hess 100%) offshore the North West Shelf of Australia.
Read more
Payara pays off for Exxon in Guyana
Slow and steady wins the race - Jerry Lee's January 2017 article highlighting the latest on Hess's Stampede development.
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