Hess CEO Discusses Climate and Energy in CERAWeek Conversations Series
February 17 2021 - 12:00PM
Business Wire
- Calls for Climate and Energy Literacy to Support Sustainable
Economic Development
- Outlines Key Challenges of Climate Change and Energy
Transition
- Says Oil Industry is a Strategic Engine of U.S.
Economy
John Hess, CEO of Hess Corporation (NYSE: HES), shares his
perspective on a range of energy issues in the latest edition of
the CERAWeek Conversations series. In a discussion with IHS Markit
Vice Chairman Daniel Yergin, Hess describes the need for climate
and energy literacy in order to tackle the critical challenge of
climate change, the vital importance of the oil and gas industry to
the U.S. economy, and the company’s strategic focus. The video is
available here.
Selected excerpts (edited for brevity):
- On climate change: “There is no doubt climate change is
real and the greatest scientific undertaking of the 21st century.
People tend to oversimplify the challenge of getting to net zero
carbon emissions while at the same time needing more energy. In the
International Energy Agency’s rigorous Sustainable Development
Scenario, which assumes that even if all the pledges of the Paris
Climate Accord are met, oil and gas will still be 46% of the supply
mix of energy in 2040. So it is not just about climate literacy, it
is also about energy literacy. We need both for sustainable
development.”
- On the energy transition: “The energy transition comes
down to two big challenges. How do you decarbonize liquid fuel, and
how do you make the electric grid reliable and resilient using
intermittent sources of energy such as wind and solar that are only
available 30% of the time? The takeaway is the energy transition is
going to take a long time, cost a lot of money and need
technologies that do not exist today.”
- On the oil market outlook: “We see a V-shaped recovery
for oil demand. As vaccines roll out and people are flying again,
we think we will get to pre-COVID demand levels by the beginning of
next year. Supply, on the other hand, we see as a U-shaped
recovery. There were 1.1 billion barrels of excess oil supply in
April; that number is about 550 million barrels now. So we think we
will see pre-COVID inventory levels by the fall if not
sooner.”
- On the role of oil and gas in the U.S. economy: “Oil and
gas are a strategic engine for the U.S. economy, accounting for 12
million direct and indirect jobs – more than manufacturing,
aviation or automotive. U.S. electricity costs are half what they
are in Europe mainly because of shale gas. Also, the U.S. is the
world’s largest oil and gas producer, which enhances our national
security.”
- On Hess Corporation’s strategy:“We have three strategic
objectives: grow our oil resources, have a low cost of supply, and
sustain cash flow growth so we can have durable cash flow growing
over the next 10 years. It requires a differentiated portfolio of
short cycle as well as long cycle projects – the best rocks for the
best returns.”
- On Hess’ position offshore Guyana: “This is one of the
biggest petroleum provinces found in the last 20 years. Hess has a
30% interest with ExxonMobil as operator, and in 2015 we discovered
oil there. Since then, we have had 18 discoveries finding over 9
billion barrels of oil equivalent, and we see multibillion barrels
of exploration potential remaining. We have one ship producing
120,000 barrels a day, we have five ships planned to get to over
750,000 barrels a day by 2026, and we have line of sight to 10
floating production, storage, and offloading vessels for this
decade.”
Hess Corporation is a leading global independent energy company
engaged in the exploration and production of crude oil and natural
gas. More information is available at www.hess.com.
CERAWeek Conversations features original interviews and
discussion with energy industry leaders, government officials and
policymakers. The series is produced by the team responsible for
the world’s preeminent energy conference, CERAWeek by IHS
Markit.
Cautionary Statements
This release contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Words such as “anticipate,” “estimate,” “expect,” “forecast,”
“guidance,” “could,” “may,” “should,” “would,” “believe,” “intend,”
“project,” “plan,” “predict,” “will,” “target,” “see,” “think” and
similar expressions identify forward-looking statements, which are
not historical in nature. Our forward-looking statements may
include, without limitation statements relating to: future economic
and market conditions in the United States and the oil and gas
industry; oil supply and demand; our future financial and
operational results; our business strategy; and estimates and
timing in achieving our crude oil and natural gas levels of
production.
Forward-looking statements are based on our current
understanding, assessments, estimates and projections of relevant
factors and reasonable assumptions about the future.
Forward-looking statements are subject to certain known and unknown
risks and uncertainties that could cause actual results to differ
materially from our historical experience and our current
projections or expectations of future results expressed or implied
by these forward-looking statements. The following important
factors could cause actual results to differ materially from those
in our forward-looking statements: fluctuations in market prices of
crude oil, natural gas liquids and natural gas and competition in
the oil and gas exploration and production industry, including as a
result of the global COVID-19 pandemic; reduced demand for our
products, including due to the global COVID-19 pandemic or the
outbreak of any other public health threat, or due to the impact of
competing or alternative energy products and political conditions
and events; potential failures or delays in increasing oil and gas
reserves, including as a result of unsuccessful exploration
activity, drilling risks and unforeseen reservoir conditions, and
in achieving expected production levels; changes in tax, property,
contract and other laws, regulations and governmental actions
applicable to our business, including legislative and regulatory
initiatives regarding environmental concerns, such as measures to
limit greenhouse gas emissions and flaring as well as fracking
bans; disruption or interruption of our operations due to
catastrophic events, such as accidents, severe weather, geological
events, shortages of skilled labor, cyber-attacks or health
measures related to COVID-19; the ability of our contractual
counterparties to satisfy their obligations to us, including the
operation of joint ventures under which we may not control;
unexpected changes in technical requirements for constructing,
modifying or operating exploration and production facilities and/or
the inability to timely obtain or maintain necessary permits;
availability and costs of employees and other personnel, drilling
rigs, equipment, supplies and other required services; any
limitations on our access to capital or increase in our cost of
capital, including as a result of weakness in the oil and gas
industry or negative outcomes within commodity and financial
markets; liability resulting from litigation; and other factors
described in Item 1A—Risk Factors in our Annual Report on Form 10-K
and any additional risks described in our other filings with the
Securities and Exchange Commission.
As and when made, we believe that our forward-looking statements
are reasonable. However, given these risks and uncertainties,
caution should be taken not to place undue reliance on any such
forward-looking statements since such statements speak only as of
the date when made and there can be no assurance that such
forward-looking statements will occur and actual results may differ
materially from those contained in any forward-looking statement we
make. Except as required by law, we undertake no obligation to
publicly update or revise any forward-looking statements, whether
because of new information, future events or otherwise.
We use certain terms in this release relating to resources other
than proved reserves, such as unproved reserves or resources.
Investors are urged to consider closely the oil and gas disclosures
in Hess Corporation’s Form 10-K, File No. 1-1204, available from
Hess Corporation, 1185 Avenue of the Americas, New York, New York
10036 c/o Corporate Secretary and on our website at www.hess.com.
You can also obtain this form from the SEC on the EDGAR system.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210217005793/en/
Investor Contact: Jay Wilson (212) 536-8940
jrwilson@hess.com
Media Contact: Lorrie Hecker (212) 536-8250
lhecker@hess.com
Hess (NYSE:HES)
Historical Stock Chart
From Mar 2024 to Apr 2024
Hess (NYSE:HES)
Historical Stock Chart
From Apr 2023 to Apr 2024