Hess Corporation (HESS) has redirected US $505 million from its operations at the Gulf of Mexico to its operations in Guyana, signaling a growing faith in Guyanese oil and gas industry.
At the 6.6 million acres Stabroek Block, Hess Guyana Exploration Ltd. holds 30 percent interest and partners with ExxonMobil affiliate Esso Exploration and Production Guyana Limited (EEPGL) and CNOOC Petroleum Guyana Limited. The company was most recently involved in the signing of the Payara Petroleum Production License (PPL), a $9 billion development targeting an estimated resource base of 600 million oil-equivalent barrels. It has committed US$1.8 billion to the project.
On Monday Hess announced that it has entered into an agreement to sell its 28 percent working interest in the Shenzi Field in the deep-water Gulf of Mexico to BHP Billiton, the field’s operator, for a total consideration of $505 million, subject to customary adjustments. The arrangement has an effective date of July 1, 2020. Meanwhile, the field produced an average of 11,000 net barrels of oil equivalent per day in the first eight months of 2020.
“Proceeds will be used to fund our world class investment opportunity in Guyana,” Chief Executive Officer, John Hess said. “This sale is aligned with our strategy to preserve cash and preserve the long-term value of our assets in the current low oil price environment.” The transaction is expected to close before year end 2020 and is subject to customary closing conditions.
