Key Developments:
- Announced an oil discovery at Uaru-2 on the Stabroek Block,
offshore Guyana; adds to the previously announced gross discovered
recoverable resource estimate for the block of approximately 9
billion barrels of oil equivalent (boe)
- Expect to have at least six floating production, storage and
offloading vessels (FPSOs) on the Stabroek Block by 2027
- See potential for up to 10 FPSOs on the Stabroek Block to
develop the current discovered recoverable resource base
- Agreed to sell nonstrategic interests in Bakken acreage for
total consideration of $312 million, with an effective date of
March 1, 2021; the sale is expected to close within the next few
weeks
- Agreed to sell the Corporation's interests in Denmark for
total consideration of $150 million, with an effective date of
January 1, 2021; the sale is expected to close in the third quarter
of 2021
- Received net proceeds of $70 million from the public
offering of 3,450,000 Hess-owned Class A shares in Hess Midstream
LP; following the offering, Hess’ ownership in Hess Midstream LP is
approximately 46%
First Quarter Financial and Operational Highlights:
- Net income was $252 million, or $0.82 per common share,
compared with a net loss of $2,433 million, or $8.00 per common
share in the first quarter of 2020. Adjusted net loss1 in the first
quarter of 2020 was $182 million, or $0.60 per common
share
- Higher natural gas liquids (NGL) prices increased net income
by approximately $75 million as compared to the prior-year quarter
and lowered first quarter 2021 Bakken NGL volumes received as
consideration for gas processing fees under percentage of proceeds
(POP) contracts by 8,000 barrels of oil equivalent per day
(boepd)
- Oil and gas net production, excluding Libya, was 315,000
boepd and Bakken net production was 158,000 boepd
- Cash and cash equivalents, excluding Midstream, were $1.86
billion at March 31, 2021
Updated 2021 Production Guidance:
- Net production, excluding Libya, is now forecast to be
290,000 boepd to 295,000 boepd from previous guidance of
approximately 310,000 boepd, reflecting a 7,000 boepd reduction in
expected NGL volumes received as consideration from POP contracts
for gas processing fees due to higher NGL prices which improve
financial results, a reduction of 6,000 boepd from asset sales, and
the balance primarily from adverse winter weather in North
Dakota
- “Adjusted net income (loss)” is a non-GAAP financial measure.
The definition of this non-GAAP measure and a reconciliation to its
nearest GAAP equivalent measure appears on pages 6 to 8.
Hess Corporation (NYSE: HES) today reported net income of $252
million, or $0.82 per common share, in the first quarter of 2021,
compared with a net loss of $2,433 million, or $8.00 per common
share, in the first quarter of 2020 that included impairment and
other after-tax charges of $2,251 million. On an adjusted basis,
the net loss in the first quarter of 2020 was $182 million, or
$0.60 per common share. The improvement in adjusted after-tax
results compared with the prior-year period primarily reflects
higher realized selling prices, contribution from the sale of two
VLCC cargos and lower depletion, depreciation and amortization
expenses.
“Our company continues to successfully execute
our strategy to grow our resource base, have a low cost of supply
and sustain cash flow growth,” CEO John Hess said. “As our
portfolio generates increasing free cash flow, we will first
prioritize debt reduction and then the return of capital to our
shareholders through dividend increases and opportunistic share
repurchases.”
After-tax income (loss) by major operating
activity was as follows:
Three Months Ended March 31,
(unaudited)
2021
2020
(In millions, except per share
amounts)
Net Income (Loss)
Attributable to Hess Corporation
Exploration and Production
$
308
$
(2,371)
Midstream
75
61
Corporate, Interest and Other
(131)
(123)
Net income (loss) attributable to Hess
Corporation
$
252
$
(2,433)
Net income (loss) per common share
(diluted)
$
0.82
$
(8.00)
Adjusted Net Income
(Loss) Attributable to Hess Corporation
Exploration and Production
$
308
$
(120)
Midstream
75
61
Corporate, Interest and Other
(131)
(123)
Adjusted net income (loss) attributable to
Hess Corporation
$
252
$
(182)
Adjusted net income (loss) per common
share (diluted)
$
0.82
$
(0.60)
Weighted average number of shares
(diluted)
307.8
304.0
Exploration and Production:
E&P net income was $308 million in the
first quarter of 2021, compared with a net loss of $2,371 million
in the first quarter of 2020. On an adjusted basis, E&P's first
quarter 2020 net loss was $120 million. The Corporation’s average
realized crude oil selling price, including the effect of hedging,
was $50.02 per barrel in the first quarter 2021, compared with
$45.94 per barrel in the year-ago quarter. The average realized NGL
selling price in the first quarter of 2021 was $29.49 per barrel,
compared with $9.32 per barrel in the prior-year quarter, while the
average realized natural gas selling price was $4.90 per mcf,
compared with $3.16 per mcf in the first quarter of 2020.
Net production, excluding Libya, was 315,000
boepd in the first quarter of 2021, compared with 344,000 boepd in
the first quarter of 2020 or 332,000 boepd pro forma for the sale
of the Corporation's interest in the Shenzi Field. Net production
for Libya was 18,000 boepd in the first quarter of 2021 compared
with 5,000 boepd in the first quarter of 2020.
Cash operating costs, which include operating
costs and expenses, production and severance taxes, and E&P
general and administrative expenses, were $9.81 per boe in the
first quarter of 2021, compared with $9.70 per boe in the
prior-year quarter. The increase in the effective tax rate in the
first quarter of 2021 compared with the year-ago period was
primarily due to higher production volumes in Libya.
Operational Highlights for the First Quarter of 2021:
Bakken (Onshore U.S.): Net production
from the Bakken was 158,000 boepd compared with 190,000 boepd in
the prior-year quarter, primarily due to reduced drilling activity,
lower NGL and natural gas volumes received under percentage of
proceeds contracts due to higher commodity prices, and the impact
of adverse winter weather. NGL and natural gas volumes received
under percentage of proceeds contracts were 19,000 boepd in the
first quarter of 2020 and 20,000 boepd in the fourth quarter of
2020, but were reduced to 11,000 boepd in the first quarter of 2021
due to higher realized NGL prices lowering volumes received as
consideration for gas processing fees. Higher NGL prices increased
net income by approximately $75 million as compared to the
prior-year quarter. During the first quarter of 2021, 11 wells were
drilled, 10 wells were completed, and 4 new wells were brought
online. In February, the Corporation increased the number of
operated rigs from one to two.
During the first quarter of 2021, the
Corporation completed the sale of 4.2 million barrels of Bakken
crude oil transported and stored on two very large crude carriers
(VLCCs) during 2020, which contributed net income of approximately
$70 million in the first quarter.
In April, the Corporation entered into an
agreement to sell its Little Knife and Murphy Creek nonstrategic
acreage interests in the Bakken for total consideration of $312
million, subject to customary closing adjustments, with an
effective date of March 1, 2021. The sale consists of approximately
78,700 net acres, which are located in the southernmost portion of
the Corporation's Bakken position and are not connected to Hess
Midstream LP infrastructure. Net production from this acreage
during the first quarter of 2021 was approximately 4,500 boepd.
Net production from the Bakken is forecast to
be 155,000 to 160,000 boepd for full year 2021, reflecting the
impact of lower NGL volumes received as consideration for gas
processing fees under POP contracts due to higher NGL prices, the
sale of the Corporation’s nonstrategic acreage interests, and
adverse winter weather.
Gulf of Mexico (Offshore U.S.): Net
production from the Gulf of Mexico was 56,000 boepd, compared with
74,000 boepd in the prior-year quarter, reflecting the sale of the
Corporation's interest in the Shenzi Field in the fourth quarter of
2020 and natural field decline. Net production from the Shenzi
Field was 12,000 boepd in the first quarter of 2020.
Guyana (Offshore): At the Stabroek
Block (Hess – 30%), the Corporation’s net production from the Liza
Field was 31,000 barrels of oil per day (bopd) compared with 15,000
bopd in the prior-year quarter. The Liza Destiny FPSO reached its
nameplate capacity of 120,000 gross bopd in December 2020 and
remained at this level during the first quarter of 2021. In
mid-April, production from the Liza Destiny FPSO was curtailed for
several days after a leak was detected in the flash gas compressor
discharge silencer. Production has since ramped back up and is
expected to remain in the range of 100,000 to 110,000 gross bopd
until repairs to the discharge silencer are completed in
approximately three months. Following this repair, production is
expected to return to, or above, nameplate capacity.
Startup of Phase 2 of the Liza Field
development, which will utilize the Liza Unity FPSO with an
expected capacity of 220,000 gross bopd, remains on track for early
2022. The third development, Payara, will utilize the Prosperity
FPSO with an expected capacity of 220,000 gross bopd; first oil is
expected in 2024. A fourth development, Yellowtail, has been
identified on the Stabroek Block with anticipated startup in 2025,
pending government approvals and project sanctioning. We expect to
have at least six FPSOs on the Stabroek Block by 2027 with the
potential for up to 10 FPSOs to develop the current discovered
recoverable resource base.
The Uaru-2 well encountered approximately 120
feet of high quality oil bearing sandstone reservoir, including
newly identified intervals below the original Uaru-1 discovery. The
well was drilled in 5,659 feet of water and is located
approximately 6.8 miles south of the Uaru-1 well. The Uaru-2
discovery will add to the discovered recoverable resource estimate
of approximately 9 billion boe.
The Stena DrillMax is currently appraising the
Longtail discovery, which will include a planned sidetrack. The
Noble Don Taylor will drill the Mako-2 well after Uaru-2, and the
Stena Carron is currently drilling the Koebi-1 exploration well.
The Noble Tom Madden, the Noble Bob Douglas and the Noble Sam
Croft, which recently arrived at the Stabroek Block, are primarily
focused on development drilling.
South East Asia (Offshore): Net
production at North Malay Basin and JDA was 64,000 boepd, compared
with 58,000 boepd in the prior-year quarter, reflecting higher
natural gas nominations due to a recovery in economic activity.
Denmark (Offshore): In March, the
Corporation entered into an agreement to sell its interests in
Denmark for total consideration of $150 million, subject to
customary closing adjustments, with an effective date of January 1,
2021. Net production from Denmark during the first quarter of 2021
was 6,000 boepd. The sale is expected to close during the third
quarter of 2021.
Midstream:
The Midstream segment had net income of $75
million in the first quarter of 2021, compared with net income of
$61 million in the prior-year quarter, primarily due to higher
minimum volume commitments and tariff rates.
Corporate, Interest and Other:
After-tax expense for Corporate, Interest and
Other was $131 million in the first quarter of 2021, compared with
$123 million in the first quarter of 2020. Interest expense
increased $6 million compared with the prior-year quarter primarily
due to interest on the Corporation's $1 billion three year term
loan entered into in March 2020.
Capital and Exploratory Expenditures:
E&P capital and exploratory expenditures
were $309 million in the first quarter of 2021, down from $631
million in the prior-year quarter. The decrease is primarily driven
by a lower rig count in the Bakken and lower development drilling
in the Gulf of Mexico and Malaysia. Midstream capital expenditures
were $23 million in the first quarter of 2021, down from $57
million in the prior-year quarter.
Liquidity:
Excluding the Midstream segment, Hess
Corporation had cash and cash equivalents of $1.86 billion and debt
and finance lease obligations totaling $6.6 billion at March 31,
2021. The Corporation’s debt to capitalization ratio, as defined in
its debt covenants, was 46.6% at March 31, 2021 and 47.5% at
December 31, 2020. The Midstream segment had cash and cash
equivalents of $4 million and total debt of $1.9 billion at March
31, 2021. Net cash provided by operating activities was $591
million in the first quarter of 2021, up from $445 million in the
first quarter of 2020, primarily due to higher realized selling
prices and the sale of 4.2 million barrels of Bakken crude oil
stored on two VLCCs in the first quarter of 2021. Net cash provided
by operating activities before changes in operating assets and
liabilities2 was $815 million in the first quarter of 2021,
compared with $502 million in the prior-year quarter. Changes in
operating assets and liabilities decreased cash flow from operating
activities by $224 million during the first quarter of 2021 and by
$57 million during the prior-year quarter.
2. “Net cash provided by (used in) operating activities before
changes in operating assets and liabilities” is a non-GAAP
financial measure. The definition of this non-GAAP measure and a
reconciliation to its nearest GAAP equivalent measure appears on
pages 7 and 8.
In March 2021, the Corporation received net
proceeds of $70 million from the public offering of 3,450,000 Class
A shares of Hess Midstream LP. After giving effect to this
transaction, the Corporation owns an approximate 46% interest in
Hess Midstream LP, on a consolidated basis.
In April 2021, the Corporation amended its
fully undrawn $3.5 billion revolving credit facility to extend the
maturity by one year from May 2023 to May 2024.
The Corporation expects to receive proceeds
from the sale of its Little Knife and Murphy Creek acreage
interests in the Bakken in the next few weeks and expects to
receive proceeds from the sale of its interests in Denmark in the
third quarter of 2021.
Items Affecting Comparability of Earnings Between
Periods:
The following table reflects the total
after-tax income (expense) of items affecting comparability of
earnings between periods:
Three Months Ended March 31,
(unaudited)
2021
2020
(In millions)
Exploration and Production
$
—
$
(2,251)
Midstream
—
—
Corporate, Interest and Other
—
—
Total items affecting comparability of
earnings between periods
$
—
$
(2,251)
First Quarter 2020: Exploration and Production
results included noncash asset impairment charges on certain oil
and gas properties totaling $2.1 billion ($2.0 billion after income
taxes), due to a lower long-term crude oil price outlook, and other
noncash charges totaling $226 million ($222 million after income
taxes) related to the impact of the significant drop in crude oil
prices in response to the COVID-19 global pandemic.
Reconciliation of U.S. GAAP to Non-GAAP Measures:
The following table reconciles reported net
income (loss) attributable to Hess Corporation and adjusted net
income (loss):
Three Months Ended March 31,
(unaudited)
2021
2020
(In millions)
Net income (loss) attributable to Hess
Corporation
$
252
$
(2,433)
Less: Total items affecting comparability
of earnings between periods
—
(2,251)
Adjusted net income (loss) attributable to
Hess Corporation
$
252
$
(182)
The following table reconciles reported net
cash provided by (used in) operating activities from net cash
provided by (used in) operating activities before changes in
operating assets and liabilities:
Three Months Ended March 31,
(unaudited)
2021
2020
(In millions)
Net cash provided by (used in) operating
activities before changes in operating assets and liabilities
$
815
$
502
Changes in operating assets and
liabilities
(224)
(57)
Net cash provided by (used in) operating
activities
$
591
$
445
Hess Corporation will review first quarter financial and
operating results and other matters on a webcast at 10 a.m. today
(EDT). For details about the event, refer to the Investor Relations
section of our website at www.hess.com.
Hess Corporation is a leading global independent energy company
engaged in the exploration and production of crude oil and natural
gas. More information on Hess Corporation is available at
www.hess.com.
Forward-looking 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” and similar
expressions identify forward-looking statements, which are not
historical in nature. Our forward-looking statements may include,
without limitation: our future financial and operational results;
our business strategy; estimates of our crude oil and natural gas
reserves and levels of production; benchmark prices of crude oil,
NGL and natural gas and our associated realized price
differentials; our projected budget and capital and exploratory
expenditures; expected timing and completion of our development
projects and proposed asset sales; and future economic and market
conditions in the oil and gas industry.
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, NGL 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 the COVID-19 pandemic; the ability of our
contractual counterparties to satisfy their obligations to us,
including the operation of joint ventures under which we may not
control; the ability to satisfy the closing conditions of the
proposed asset sales; 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, including
heightened risks associated with being a general partner of Hess
Midstream LP; 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 (SEC).
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.
Non-GAAP financial measures
The Corporation has used non-GAAP financial measures in this
earnings release. “Adjusted net income (loss)” presented in this
release is defined as reported net income (loss) attributable to
Hess Corporation excluding items identified as affecting
comparability of earnings between periods. “Net cash provided by
(used in) operating activities before changes in operating assets
and liabilities” presented in this release is defined as Net cash
provided by (used in) operating activities excluding changes in
operating assets and liabilities. Management uses adjusted net
income (loss) to evaluate the Corporation’s operating performance
and believes that investors’ understanding of our performance is
enhanced by disclosing this measure, which excludes certain items
that management believes are not directly related to ongoing
operations and are not indicative of future business trends and
operations. Management believes that net cash provided by (used in)
operating activities before changes in operating assets and
liabilities demonstrates the Corporation’s ability to internally
fund capital expenditures, pay dividends and service debt. These
measures are not, and should not be viewed as, a substitute for
U.S. GAAP net income (loss) or net cash provided by (used in)
operating activities. A reconciliation of reported net income
(loss) attributable to Hess Corporation (U.S. GAAP) to adjusted net
income (loss), and a reconciliation of net cash provided by (used
in) operating activities (U.S. GAAP) to net cash provided by (used
in) operating activities before changes in operating assets and
liabilities are provided in the release.
Cautionary Note to Investors
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.
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
First Quarter 2021
First Quarter 2020
Fourth Quarter 2020
Income
Statement
Revenues and non-operating
income
Sales and other operating revenues
$
1,898
$
1,354
$
1,321
Gains (losses) on asset sales, net
—
—
79
Other, net
21
15
17
Total revenues and non-operating
income
1,919
1,369
1,417
Costs and expenses
Marketing, including purchased oil and
gas
518
378
281
Operating costs and expenses
265
303
313
Production and severance taxes
37
42
32
Exploration expenses, including dry holes
and lease impairment
33
189
60
General and administrative expenses
94
102
82
Interest expense
117
113
118
Depreciation, depletion and
amortization
396
561
486
Impairment
—
2,126
—
Total costs and expenses
1,460
3,814
1,372
Income (loss) before income
taxes
459
(2,445)
45
Provision (benefit) for income taxes
123
(79)
72
Net income (loss)
336
(2,366)
(27)
Less: Net income (loss) attributable to
noncontrolling interests
84
67
70
Net income (loss) attributable to Hess
Corporation
$
252
$
(2,433)
$
(97)
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
March 31, 2021
December 31, 2020
Balance Sheet
Information
Assets
Cash and cash equivalents
$
1,866
$
1,739
Other current assets
1,656
1,342
Property, plant and equipment – net
13,863
14,115
Operating lease right-of-use assets –
net
386
426
Finance lease right-of-use assets –
net
161
168
Other long-term assets
1,019
1,031
Total assets
$
18,951
$
18,821
Liabilities and equity
Current maturities of long-term debt
$
13
$
10
Current portion of operating and finance
lease obligations
83
81
Other current liabilities
1,594
1,532
Long-term debt
8,273
8,286
Long-term operating lease obligations
437
478
Long-term finance lease obligations
215
220
Other long-term liabilities
1,693
1,879
Total equity excluding other comprehensive
income (loss)
6,392
6,121
Accumulated other comprehensive income
(loss)
(776)
(755)
Noncontrolling interests
1,027
969
Total liabilities and equity
$
18,951
$
18,821
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
March 31, 2021
December 31, 2020
Total
Debt
Hess Corporation
$
6,387
$
6,386
Midstream (a)
1,899
1,910
Hess Consolidated
$
8,286
$
8,296
- Midstream debt is non-recourse to Hess Corporation.
March 31, 2021
December 31, 2020
Debt to
Capitalization Ratio (a)
Hess Consolidated
56.2
%
57.4
%
Hess Corporation as defined in debt
covenants
46.6
%
47.5
%
- Includes finance lease obligations.
Three Months Ended March 31,
2021
2020
Interest Expense
Hess Corporation
$
94
$
88
Midstream (a)
23
25
Hess Consolidated
$
117
$
113
- Midstream interest expense is reported in the Midstream
operating segment.
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
First Quarter 2021
First Quarter 2020
Fourth Quarter 2020
Cash Flow
Information
Cash Flows from Operating
Activities
Net income (loss)
$
336
$
(2,366)
$
(27)
Adjustments to reconcile net income (loss)
to net cash
provided by (used in) operating
activities:
(Gains) losses on asset sales, net
—
—
(79)
Depreciation, depletion and
amortization
396
561
486
Impairment
—
2,126
—
Exploratory dry hole costs
—
135
26
Exploration lease and other impairment
4
32
3
Pension settlement loss
1
—
—
Stock compensation expense
25
29
16
Noncash (gains) losses on commodity
derivatives, net
24
70
73
Provision (benefit) for deferred income
taxes and other tax accruals
29
(85)
34
Net cash provided by (used in) operating
activities before changes in operating assets and liabilities
815
502
532
Changes in operating assets and
liabilities
(224)
(57)
(46)
Net cash provided by (used in) operating
activities
591
445
486
Cash Flows from Investing
Activities
Additions to property, plant and equipment
- E&P
(358)
(740)
(319)
Additions to property, plant and equipment
- Midstream
(27)
(78)
(55)
Proceeds from asset sales, net of cash
sold
—
—
482
Other, net
—
—
(1)
Net cash provided by (used in) investing
activities
(385)
(818)
107
Cash Flows from Financing
Activities
Net borrowings (repayments) of debt with
maturities of 90 days or less
(10)
60
6
Debt with maturities of greater than 90
days:
Borrowings
—
1,000
—
Repayments
(3)
—
—
Proceeds from sale of Class A shares of
Hess Midstream LP
70
—
—
Payments on finance lease obligations
(2)
(1)
(1)
Cash dividends paid
(80)
(81)
(76)
Noncontrolling interests, net
(67)
(63)
(67)
Other, net
13
(7)
(1)
Net cash provided by (used in) financing
activities
(79)
908
(139)
Net Increase (Decrease) in Cash and
Cash Equivalents
127
535
454
Cash and Cash Equivalents at Beginning
of Period
1,739
1,545
1,285
Cash and Cash Equivalents at End of
Period
$
1,866
$
2,080
$
1,739
Additions to
Property, Plant and Equipment included within Investing
Activities
Capital expenditures incurred
$
(303)
$
(666)
$
(391)
Increase (decrease) in related
liabilities
(82)
(152)
17
Additions to property, plant and
equipment
$
(385)
$
(818)
$
(374)
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
First Quarter 2021
First Quarter 2020
Fourth Quarter 2020
Capital and
Exploratory Expenditures
E&P Capital and exploratory
expenditures
United States
North Dakota
$
88
$
322
$
72
Offshore and Other
31
93
40
Total United States
119
415
112
Guyana
172
176
224
Malaysia and JDA
13
32
25
Other
5
8
10
E&P Capital and exploratory
expenditures
$
309
$
631
$
371
Total exploration expenses charged to
income included above
$
29
$
22
$
31
Midstream Capital expenditures
$
23
$
57
$
51
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
EARNINGS (UNAUDITED)
(IN MILLIONS)
First Quarter 2021
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
1,398
$
500
$
1,898
Other, net
12
4
16
Total revenues and non-operating
income
1,410
504
1,914
Costs and expenses
Marketing, including purchased oil and gas
(a)
520
22
542
Operating costs and expenses
135
73
208
Production and severance taxes
36
1
37
Midstream tariffs
262
—
262
Exploration expenses, including dry holes
and lease impairment
30
3
33
General and administrative expenses
42
7
49
Depreciation, depletion and
amortization
268
87
355
Total costs and expenses
1,293
193
1,486
Results of operations before income
taxes
117
311
428
Provision (benefit) for income taxes
—
120
120
Net income (loss) attributable to Hess
Corporation
$
117
(b)
$
191
(c)
$
308
First Quarter 2020
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
1,122
$
232
$
1,354
Other, net
4
4
8
Total revenues and non-operating
income
1,126
236
1,362
Costs and expenses
Marketing, including purchased oil and gas
(a)
419
6
425
Operating costs and expenses
137
77
214
Production and severance taxes
40
2
42
Midstream tariffs
241
—
241
Exploration expenses, including dry holes
and lease impairment
156
33
189
General and administrative expenses
45
7
52
Depreciation, depletion and
amortization
394
127
521
Impairment
697
1,429
2,126
Total costs and expenses
2,129
1,681
3,810
Results of operations before income
taxes
(1,003)
(1,445)
(2,448)
Provision (benefit) for income taxes
—
(77)
(77)
Net income (loss) attributable to Hess
Corporation
$
(1,003)
(d)
$
(1,368)
(e)
$
(2,371)
- Includes amounts charged from the Midstream segment.
- Includes after-tax losses from realized crude oil hedging
activities of $39 million (noncash premium amortization: $39
million; cash settlement: $0 million).
- Includes after-tax losses from realized crude oil hedging
activities of $8 million (noncash premium amortization: $8 million;
cash settlement: $0 million).
- Includes after-tax gains from realized crude oil hedging
activities of $53 million (noncash premium amortization: $63
million; cash settlement: $116 million).
- Includes after-tax gains from realized crude oil hedging
activities of $11 million (noncash premium amortization: $7
million; cash settlement: $18 million).
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
EARNINGS (UNAUDITED)
(IN MILLIONS)
Fourth Quarter 2020
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
904
$
417
$
1,321
Gains (losses) on asset sales, net
79
—
79
Other, net
12
2
14
Total revenues and non-operating
income
995
419
1,414
Costs and expenses
Marketing, including purchased oil and gas
(a)
267
34
301
Operating costs and expenses
158
92
250
Production and severance taxes
30
2
32
Midstream tariffs
243
—
243
Exploration expenses, including dry holes
and lease impairment
36
24
60
General and administrative expenses
43
8
51
Depreciation, depletion and
amortization
325
121
446
Total costs and expenses
1,102
281
1,383
Results of operations before income
taxes
(107)
138
31
Provision (benefit) for income taxes
—
70
70
Net income (loss) attributable to Hess
Corporation
$
(107)
(b)
$
68
(c)
$
(39)
- Includes amounts charged from the Midstream segment.
- Includes after-tax gains from realized crude oil hedging
activities of $84 million (noncash premium amortization: $63
million; cash settlement: $147 million).
- Includes after-tax gains from realized crude oil hedging
activities of $28 million (noncash premium amortization: $10
million; cash settlement: $38 million).
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
First Quarter 2021
First Quarter 2020
Fourth Quarter 2020
Net Production
Per Day (in thousands)
Crude oil - barrels
United States
North Dakota
84
114
97
Offshore (a)
36
48
24
Total United States
120
162
121
Guyana
31
15
26
Malaysia and JDA
4
4
3
Other (b)
22
10
17
Total
177
191
167
Natural gas liquids - barrels
United States
North Dakota
49
49
61
Offshore (a)
4
7
3
Total United States
53
56
64
Natural gas - mcf
United States
North Dakota
151
162
185
Offshore
95
113
31
Total United States
246
275
216
Malaysia and JDA
360
325
315
Other (b)
11
11
7
Total
617
611
538
Barrels of oil equivalent
333
349
321
- The Corporation sold its working interest in the Shenzi Field
in the deepwater Gulf of Mexico in the fourth quarter of 2020. Net
production from the Shenzi Field was 12,000 boepd in the first
quarter of 2020 and 3,000 boepd in the fourth quarter of 2020.
- Other includes production from Denmark and Libya. Libya net
production was 18,000 boepd in the first quarter of 2021, 5,000
boepd in the first quarter of 2020 and 12,000 boepd in the fourth
quarter of 2020. Denmark net production was 6,000 boepd in the
first quarter of 2021, 7,000 boepd in the first quarter of 2020 and
6,000 boepd in the fourth quarter of 2020.
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
First Quarter 2021
First Quarter 2020
Fourth Quarter 2020
Sales Volumes Per
Day (in thousands) (a)
Crude oil – barrels
227
176
184
Natural gas liquids – barrels
53
56
64
Natural gas – mcf
617
611
538
Barrels of oil equivalent
383
334
338
Sales Volumes (in
thousands) (a)
Crude oil – barrels (b)
20,395
16,052
16,974
Natural gas liquids – barrels
4,802
5,097
5,842
Natural gas – mcf
55,513
55,620
49,542
Barrels of oil equivalent
34,449
30,419
31,073
- Sales volumes from purchased crude oil, natural gas liquids,
and natural gas are not included in the sales volumes
reported.
- Sales volumes for the first quarter of 2021 include 4.2 million
barrels of crude oil that were stored on VLCCs at December 31,
2020.
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
First Quarter 2021
First Quarter 2020
Fourth Quarter 2020
Average Selling
Prices
Crude oil - per barrel (including
hedging)
United States
North Dakota (a)
$
44.97
$
44.05
$
42.69
Offshore
53.03
49.33
47.59
Total United States
46.73
45.63
43.65
Guyana
60.37
43.26
49.56
Malaysia and JDA
63.27
51.24
37.80
Other (b)
57.66
55.60
50.22
Worldwide
50.02
45.94
45.32
Crude oil - per barrel (excluding
hedging)
United States
North Dakota (a)
$
47.62
$
40.54
$
36.46
Offshore
56.53
45.65
41.36
Total United States
49.56
42.07
37.42
Guyana
61.85
36.79
43.96
Malaysia and JDA
63.27
51.24
37.80
Other (b)
59.61
49.14
44.63
Worldwide
52.52
42.08
39.45
Natural gas liquids - per
barrel
United States
North Dakota
$
30.32
$
9.31
$
15.93
Offshore
21.25
9.39
13.07
Worldwide
29.49
9.32
15.80
Natural gas - per mcf
United States
North Dakota
$
5.93
$
1.28
$
1.67
Offshore
2.95
1.32
1.42
Total United States
4.78
1.30
1.64
Malaysia and JDA
5.04
4.71
4.57
Other (b)
2.69
4.26
2.27
Worldwide
4.90
3.16
3.35
- Excluding the two VLCC cargo sales totaling 4.2 million
barrels, the first quarter 2021 North Dakota crude oil price
excluding hedging was $53.30 per barrel and $49.73 per barrel
including hedging.
- Other includes prices related to production from Denmark and
Libya.
The following is a summary of the Corporation’s outstanding
crude oil put options for the remainder of 2021:
WTI
Brent
Barrels of oil per day
120,000
30,000
Average monthly floor price
$55
$60
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210428005299/en/
For Hess Corporation Investor Contact: Jay Wilson
(212) 536-8940 Media Contacts: Lorrie Hecker (212) 536-8250
Jamie Tully Sard Verbinnen & Co (917) 679-7908
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