Hess (HES) Appointed for Marketing 2 Guyana Crude Shipments
Hess Corporation HES has been recently appointed by Guyana to market two crude shipments from its offshore production, per Reuters. While this is a temporary move by the South American country, the search for a permanent partner is still on.
Guyana — which recently became the oil hotspot following a series of discoveries made by a consortium of Exxon Mobil Corporation XOM, Hess and CNOOC Limited CEO — depends on private companies to market its share of crude production. The country has no oil company of its own. As a result, it can’t refine its share of production. In fact, the country marketed its first three shipments with the help of Royal Dutch Shell plc RDS.A.
World-class oil discoveries at the Stabroek Block, wherein Hess estimates gross recoverable resource of 9 billion barrels of oil equivalent, are expected to be a game changer for Guyana’s economy. Moreover, the company projects daily Guyana oil production volumes to reach more than 750,000 gross barrels. It is expected to record significant production growth from the Guyana prospect in the coming years.
New York-based Hess expects 2021 exploration and production capital and exploration expenditure to be $1.9 billion, indicating an increase from the 2020 reported figure of $1.8 billion. Of the total amount, more than 80% will be allotted to Bakken and Guyana. As such, it expects 2021 net production volumes — excluding Libya — to reach 310,000 barrels of oil equivalent per day. Importantly, it has hedged 120 thousand barrels of oil per day for 2021 to safeguard itself from oil price declines.
Price Performance & Zacks Rank
Hess has gained 9.2% in the past six months compared with 22.6% rise of the industry it belongs to. Currently, Hess carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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