Increased oil production in Guyana helped drive higher profit for Hess Corporation
Jan 30, 2025
Kaieteur News- Oil production from Guyana’s Stabroek Block, where American oil company Hess Corporation holds 30% shares, has emerged as the company’s top seller in 2024, with an average price of US$80.04 per barrel.
According to information from the company’s fourth quarter financial and operational highlights, Guyana’s crude commanded the highest price among Hess’ global operations, outpacing sales from North Dakota, offshore U.S. assets, and Malaysia.
The Stabroek Block (Increased oil production)
On Wednesday, Hess reported net profit of US$542 million, for the fourth quarter of 2024, an increase from US$413 million, in the same period of 2023.
Total oil and gas production averaged 495,000 barrels of oil equivalent per day (boepd), up 18% from 418,000 boepd in the fourth quarter of 2023. Notably, Bakken in the United States contributed significantly, with production rising by 7% to 208,000 barrels of oil equivalent per day (boepd) from 194,000 boepd for the same period in 2023. It was highlighted too that Guyana played a pivotal role in Hess’ growth, with net production soaring by 52% to 195,000 barrels of oil per day (bopd), compared to 128,000 bopd in the fourth quarter of 2023.
The Stabroek Block which covers an area of 6.6 million acres is estimated to hold 11.6 billion barrels of oil. To date, Exxon has obtained approval from the Government of Guyana for six development projects in the Stabroek Block – Liza Phase One, Liza Phase Two, Payara, Yellowtail, Uaru and Whiptail.
The first three projects are already producing oil at a daily estimated rate of 660,000 barrels per day (bpd). With the addition of Hammerhead and Longtail, Exxon said this will expand gross production in Guyana to approximately 1.3 million barrels per day, with total production capacity expected to reach 1.7 million barrels per day on an investment basis.
Chief Executive Officer (CEO) of Hess Corporation, John Hess
Moreover, Hess Corporation is pursuing a US$53 billion merger with American oil giant, Chevron. However, ExxonMobil, the Stabroek Block operator, and CNOOC the third-block partner have initiated arbitration, citing a right of first refusal on Hess’s share of the block. Despite this, Hess expressed confidence that the merger would proceed as planned.
“We think Exxon’s position and CNOOC’s position is without merit, baseless. It’s about the right of refusal. We think it’s very clear, the words on paper in English law that there’s no right or refusal to be exercised. So, we’re very confident that merger is going to go through, and we’re getting prepared for that,” Chief Executive Officer of Hess, John Hess had stated.
The arbitration hearing is set for May 2025, with a decision expected approximately 90 days later. Hess explained the process, saying, “Memorials have been exchanged. The hearing is going to be in May. The decision should be rendered about 90 days later, so let’s say late August, September, and once that’s done, we look forward to completing the merger.”
(Increased oil production in Guyana helped drive higher profit for Hess Corporation)
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