Hess Takes Final Investment Decision for Liza Phase 1 Development Offshore Guyana
June 16 2017 - 8:15AM
Business Wire
Announces Positive Liza-4 Results, Further Increasing
Resource Estimate
Hess Corporation (NYSE:HES) today announced it has sanctioned
the first phase of development of the Liza Field, one of the
industry’s largest oil discoveries of the past decade, located on
the Stabroek Block offshore Guyana. In addition, the company
announced positive results from the Liza-4 well, which encountered
more than 197 feet (60 meters) of high-quality, oil-bearing
sandstone reservoirs and will underpin a potential Liza Phase 2
development. Gross discovered recoverable resources for the
Stabroek Block are now estimated to be 2.0 billion to 2.5 billion
barrels of oil equivalent, including Liza and other successful
exploration wells on Liza Deep, Payara and Snoek.
The first phase of a planned multiphase development of the Liza
Field is expected to have a gross capital cost of approximately
$3.2 billion for drilling and subsea infrastructure and will
develop approximately 450 million barrels of oil, with first oil
expected by 2020. The first phase of development will utilize a
leased floating production, storage and offloading vessel (FPSO)
that will have the capacity to process up to 120,000 barrels of oil
per day from four subsea drill centers consisting of 17 wells,
including eight producers, six water injectors and three gas
injectors. Hess’ net share of development costs is forecast to be
approximately $955 million, of which $110 million is already
included in Hess’ 2017 capital and exploratory budget. Of the
remaining net development costs, approximately $250 million is
expected in 2018 and approximately $330 million in 2019, with the
balance expected between 2020 and 2021.
“Development of the world class Liza resource with a low cost,
phased approach accelerates first production and positions us to
deliver significant value to our shareholders,” CEO John Hess said.
“We look forward to working with our partners and with the
Government of Guyana on this important project.”
In 2017 and 2018, Hess and its partners plan to continue
exploration and appraisal of the 6.6 million acre Stabroek block.
There are numerous prospects across multiple play types on the
block, representing additional multibillion barrel unrisked
exploration potential. Drilling of the Payara-2 well, which will
also test a deeper prospect underlying the Payara oil discovery, is
expected to commence in late June following completion of a
drillstem test at Liza-4.
Esso Exploration and Production Guyana Limited is operator and
holds 45 percent interest in the Stabroek Block. Hess Guyana
Exploration Limited holds a 30 percent interest and CNOOC Nexen
Petroleum Guyana Limited holds a 25 percent interest.
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
http://www.hess.com.
Cautionary Statements
This news release contains projections and other forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934.
These projections and statements reflect the company’s current
views with respect to future events and financial performance. No
assurances can be given, however, that these events will occur or
that these projections will be achieved, and actual results could
differ materially from those projected as a result of certain risk
factors. A discussion of these risk factors is included in the
company’s periodic reports filed with the Securities and Exchange
Commission.
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 disclosure relating to
proved reserves in Hess’ 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.
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version on businesswire.com: http://www.businesswire.com/news/home/20170616005327/en/
Hess CorporationInvestors:Jay Wilson,
212-536-8940jrwilson@hess.comorMedia:Lorrie Hecker,
212-536-8250lhecker@hess.com
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