Key Developments:

• The Prosperity floating production, storage and offloading vessel (FPSO), which will be utilized by the Payara development, arrived at the Stabroek Block, offshore Guyana, on April 11th and is targeted for startup early fourth quarter; hook-up and commissioning activities have commenced
• Continued exploration success on the Stabroek Block, with a new oil discovery at the Lancetfish-1 well
• Improved returns to stockholders through a 17 percent increase in the first quarter dividend to $0.4375 per share

First Quarter Financial and Operational Highlights:

• Net income was $346 million, or $1.13 per share, compared with net income of $417 million, or $1.34 per share, in the first quarter of 2022; adjusted net income(1)  in the first quarter of 2022 was $404 million, or $1.30 per share
• Oil and gas net production was 374,000 barrels of oil equivalent per day (boepd), up 36 percent from 276,000 boepd, proforma for asset sold, in the first quarter of 2022 quarter of 2022; Guyana net production was 112,000 barrels of oil per day (bopd), compared with 30,000 bopd in the prior-year quarter
• E&P capital and exploratory expenditures were $765 million compared with $580 million in the prior-year quarter

2023 Updated Guidance:

• Full year net production is now forecast to be in the range of 365,000 boepd to 375,000 boepd, compared with previous guidance of 355,000 boepd to 365,000 boepd primarily due to strong operational performance in the first quarter of 2023

(1) “Adjusted net income” is a non-GAAP financial measure.

Hess Corporation today reported net income of $346 million, or $1.13 per share, in the first quarter of 2023, compared with net income of $417 million, or $1.34 per share, in the first quarter of 2022. On an adjusted basis, the Corporation reported net income of $404 million, or $1.30 per share in the first quarter of 2022. The decrease in after-tax results compared with the prior-year quarter reflects lower realized selling prices partially offset by the net impact of higher production volumes in the first quarter of 2023.

“We continue to successfully execute our strategy, which offers a unique value proposition to investors,” CEO John Hess said. “With multiple phases of low cost oil developments coming online in Guyana and our robust inventory of high return drilling locations in the Bakken, our company is positioned to deliver durable cash flow growth that enables us to continue to invest in some of the highest return projects in the industry and to grow our cash returns to our shareholders.”

Exploration and Production:

E&P net income was $405 million in the first quarter of 2023, compared with $460 million in the first quarter of 2022. The Corporation’s average realized crude oil selling price, including the effect of hedging, was $74.23 per barrel in the first quarter of 2023, compared with $86.75 per barrel in the prior-year quarter. The average realized natural gas liquids (NGL) selling price in the first quarter of 2023 was $24.25 per barrel, compared with $39.79 per barrel in the prior-year quarter, while the average realized natural gas selling price was $4.39 per mcf, compared with $5.28 per mcf in the first quarter of 2022.

Net production was 374,000 boepd in the first quarter of 2023, compared with 276,000 boepd, proforma for asset sold, in the first quarter of 2022, primarily due to higher production in Guyana and the Bakken.

Cash operating costs, which include operating costs and expenses, production and severance taxes, and E&P general and administrative expenses, were $12.96 per barrel of oil equivalent (boe) in the first quarter of 2023, compared with $13.79 per boe (excluding Libya: $14.54 per boe) in the prioryear quarter. The decrease in cash operating costs in the first quarter of this year, compared with the first quarter of last year, reflects the higher production volumes.

Exploration and Production:

E&P net income was $405 million in the first quarter of 2023, compared with $460 million in the first quarter of 2022. The Corporation’s average realized crude oil selling price, including the effect of hedging, was $74.23 per barrel in the first quarter of 2023, compared with $86.75 per barrel in the prior-year quarter. The average realized natural gas liquids (NGL) selling price in the first quarter of 2023 was $24.25 per barrel, compared with $39.79 per barrel in the prior-year quarter, while the average realized natural gas selling price was $4.39 per mcf, compared with $5.28 per mcf in the first quarter of 2022.

Net production was 374,000 boepd in the first quarter of 2023, compared with 276,000 boepd, proforma for asset sold, in the first quarter of 2022, primarily due to higher production in Guyana and the Bakken.

Cash operating costs, which include operating costs and expenses, production and severance taxes, and E&P general and administrative expenses, were $12.96 per barrel of oil equivalent (boe) in the first quarter of 2023, compared with $13.79 per boe (excluding Libya: $14.54 per boe) in the prioryear quarter. The decrease in cash operating costs in the first quarter of this year, compared with the first quarter of last year, reflects the higher production volumes.

Operational Highlights for the First Quarter of 2023:

Bakken (Onshore U.S.): Net production from the Bakken was 163,000 boepd in the first quarter of 2023 compared with 152,000 boepd in the prior-year quarter, primarily due to higher NGL volumes received under percentage of proceeds contracts and increased drilling and completion activity. The Corporation added a fourth drilling rig in July 2022 and drilled 25 wells, completed 26 wells, and brought 24 new wells online during the first quarter of 2023.

Gulf of Mexico (Offshore U.S.): Net production from the Gulf of Mexico in the first quarter of 2023 was 33,000 boepd, compared with 30,000 boepd in the prior-year quarter.

Guyana (Offshore): At the Stabroek Block (Hess – 30%), net production from the Liza Destiny and the Liza Unity FPSOs totaled 112,000 bopd in the first quarter of 2023 compared with 30,000 bopd in the prior-year quarter. The Liza Unity FPSO, which commenced production in February 2022, reached its production capacity of approximately 220,000 gross bopd in July 2022. In the first quarter of 2023, Hess sold nine cargos of crude oil from Guyana compared with two cargos in the prior year quarter.

The third development, Payara, which will utilize the Prosperity FPSO with a production capacity of approximately 220,000 gross bopd, is targeted for startup early in the fourth quarter. The Prosperity FPSO arrived at the Stabroek Block on April 11th and hook-up and commissioning activities have commenced. The fourth development, Yellowtail, was sanctioned in April 2022 and will utilize the ONE GUYANA FPSO with a production capacity of approximately 250,000 gross bopd, with first production expected in 2025. Government and regulatory approvals are expected very soon for a fifth development, Uaru, with a production capacity of approximately 250,000 gross bopd.

The Corporation today announced an oil discovery at the Lancetfish-1 well on the Stabroek Block, offshore Guyana. The Lancetfish-1 well encountered approximately 92 feet of oil bearing sandstone reservoir. The well was drilled in 5,843 feet of water by the Noble Don Taylor and is located approximately 4 miles southeast of the Fangtooth discovery.

The Kokwari-1 exploration well was drilled during the quarter and did not encounter commercial quantities of hydrocarbons.

Southeast Asia (Offshore): Net production at North Malay Basin and JDA was 66,000 boepd in the first quarter of 2023 compared with 64,000 boepd in the prior-year quarter.

KeyFacts Energy: Hess US country profile