Key Development:
- Commenced production from the Payara development at the
Stabroek Block, offshore Guyana, in November; Payara reached its
initial production capacity of approximately 220,000 gross barrels
of oil per day (bopd) in January 2024
Fourth Quarter Financial and Operational Highlights:
- Net income was $413 million, or $1.34 per share, compared
with $497 million, or $1.61 per share, in the fourth quarter of
2022
- Adjusted net income1 was $501 million, or $1.63 per share,
compared with $522 million, or $1.69 per share, in the fourth
quarter of 2022
- Oil and gas net production was 418,000 barrels of oil
equivalent per day (boepd), up 11% from 376,000
boepd, proforma for asset sold, in the fourth quarter of
2022
- Bakken net production was 194,000 boepd, up 23% from 158,000
boepd in the fourth quarter of 2022; Guyana net production was
128,000 bopd, compared with 116,000 bopd in the prior-year
quarter
- E&P capital and exploratory expenditures were $1,480
million and included the purchase of the Liza Unity floating
production, storage and offloading vessel (FPSO) for approximately
$380 million, compared with $818 million in the prior-year
quarter
- Year-end proved reserves are estimated to be 1.37 billion
barrels of oil equivalent (boe); organic reserve replacement was
178% at a finding and development cost of $16.00 per boe
Hess Corporation (NYSE: HES) today reported
net income of $413 million, or $1.34 per share, in the fourth
quarter of 2023, compared with net income of $497 million, or $1.61
per share, in the fourth quarter of 2022. On an adjusted basis, the
Corporation reported net income of $501 million, or $1.63 per share
in the fourth quarter of 2023, compared with $522 million, or $1.69
per share, in the prior-year quarter. The decrease in adjusted
after-tax results compared with the prior-year quarter reflects
lower realized gas and natural gas liquids (NGL) selling prices,
partially offset by higher production volumes, in the fourth
quarter of 2023.
1.
“Adjusted net income” is a non-GAAP
financial measure. The reconciliation to its nearest GAAP
equivalent measure, and its definition, appear on pages 6 and 7,
respectively.
After-tax income (loss) by major operating
activity was as follows:
Three Months Ended
Year Ended
December 31,
December 31,
(unaudited)
(unaudited)
2023
2022
2023
2022
(In millions, except per share
amounts)
Net Income
Attributable to Hess Corporation
Exploration and Production
$
512
$
641
$
1,601
$
2,396
Midstream
63
64
252
269
Corporate, Interest and Other
(162)
(208)
(471)
(569)
Net income attributable to Hess
Corporation
$
413
$
497
$
1,382
$
2,096
Net income per share (diluted)
$
1.34
$
1.61
$
4.49
$
6.77
Adjusted Net Income
Attributable to Hess Corporation
Exploration and Production
$
531
$
565
$
1,702
$
2,374
Midstream
63
64
252
269
Corporate, Interest and Other
(93)
(107)
(402)
(467)
Adjusted net income attributable to Hess
Corporation
$
501
$
522
$
1,552
$
2,176
Adjusted net income per share
(diluted)
$
1.63
$
1.69
$
5.05
$
7.03
Weighted average number of shares
(diluted)
307.9
308.1
307.6
309.6
Exploration and Production:
E&P net income was $512 million in the
fourth quarter of 2023, compared with $641 million in the fourth
quarter of 2022. On an adjusted basis, E&P fourth quarter 2023
net income was $531 million, compared with $565 million in the
prior-year quarter. The Corporation’s average realized crude oil
selling price, including the effect of hedging, was $76.63 per
barrel in the fourth quarter of 2023, compared with $76.07 per
barrel in the prior-year quarter. The average realized NGL selling
price in the fourth quarter of 2023 was $20.92 per barrel, compared
with $26.93 per barrel in the prior-year quarter, while the average
realized natural gas selling price was $4.51 per mcf, compared with
$5.17 per mcf in the fourth quarter of 2022.
Net production was 418,000 boepd in the fourth
quarter of 2023, compared with 376,000 boepd, proforma for asset
sold, in the fourth quarter of 2022, primarily due to higher
production in the Bakken and Guyana.
Cash operating costs, which include operating
costs and expenses, production and severance taxes, and E&P
general and administrative expenses, were $13.29 per boe in the
fourth quarter of 2023, compared with $12.72 per boe, proforma for
asset sold, in the prior-year quarter.
Oil and Gas Reserves Estimates:
Oil and gas proved reserves at December 31,
2023, which are subject to final review, were 1.37 billion boe,
compared with 1.26 billion boe at December 31, 2022. Proved reserve
additions and net revisions in 2023 totaled 261 million boe,
primarily from Guyana, which included sanctioning of the Uaru
development, and from the Bakken. The Corporation replaced 178% of
its 2023 production at a finding and development cost of $16.00 per
boe.
Operational Highlights for the Fourth Quarter of
2023:
Bakken (Onshore U.S.): Net production
from the Bakken was 194,000 boepd in the fourth quarter of 2023,
compared with 158,000 boepd in the prior-year quarter, reflecting
increased drilling and completion activity, severe winter weather
in the fourth quarter of 2022, and higher NGL and natural gas
volumes received under percentage of proceeds contracts due to
lower commodity prices. NGL and natural gas volumes received under
percentage of proceeds contracts were 19,000 boepd in the fourth
quarter of 2023, compared with 12,000 boepd in the fourth quarter
of 2022, due to lower realized NGL and natural gas prices
increasing volumes received as consideration for gas processing
fees. During the fourth quarter of 2023, the Corporation operated
four rigs and drilled 33 wells, completed 30 wells, and brought 33
new wells online. The Corporation plans to continue operating four
drilling rigs in 2024.
Gulf of Mexico (Offshore U.S.): Net
production from the Gulf of Mexico in the fourth quarter of 2023
was 30,000 boepd, compared with 35,000 boepd in the prior-year
quarter. In the fourth quarter, we were the high bidder on 20
leases in Lease Sale 261 for $88 million and we expect to be
awarded these leases in the first quarter of 2024.
Guyana (Offshore): At the Stabroek
Block (Hess – 30%), net production totaled 128,0002 bopd in the
fourth quarter of 2023, compared with 116,0002 bopd in the
prior-year quarter. In November, production commenced from the
Prosperity FPSO at Payara, which contributed 14,000 net bopd in the
fourth quarter of 2023.
The fourth development on the block,
Yellowtail, was sanctioned in April 2022 with a production capacity
of approximately 250,000 gross bopd and first production expected
in 2025. The fifth development, Uaru, was sanctioned in April 2023
with a production capacity of approximately 250,000 gross bopd and
first production expected in 2026. The operator submitted the field
development plan for the sixth development, Whiptail, to the
Government of Guyana in October 2023.
Southeast Asia (Offshore): Net
production at North Malay Basin and JDA was 66,000 boepd in the
fourth quarter of 2023, compared with 67,000 boepd in the
prior-year quarter.
Midstream:
The Midstream segment had net income of $63
million in the fourth quarter of 2023, compared with net income of
$64 million in the prior-year quarter.
In November 2023, Hess Midstream Operations LP
(HESM Opco), a consolidated subsidiary of Hess Midstream LP (HESM),
repurchased approximately 3.4 million HESM Opco Class B units held
by Hess Corporation and Global Infrastructure Partners for $100
million, of which the Corporation received $37.8 million. The
repurchase of the Class B units was financed by HESM Opco’s
revolving credit facility. After giving effect to the transaction,
the Corporation continues to own approximately 37.8% of HESM on a
consolidated basis.
Corporate, Interest and Other:
After-tax expense for Corporate, Interest and
Other was $162 million in the fourth quarter of 2023, compared with
$208 million in the fourth quarter of 2022. On an adjusted basis,
after-tax expense for Corporate, Interest and Other was $93 million
in the fourth quarter of 2023, compared with $107 million in the
fourth quarter of 2022, reflecting higher capitalized interest.
Capital and Exploratory Expenditures:
E&P capital and exploratory expenditures
were $1,480 million in the fourth quarter of 2023, compared with
$818 million in the prior-year quarter, reflecting the purchase of
the Liza Unity FPSO in the fourth quarter of 2023 for approximately
$380 million, higher development activities in Guyana, and higher
drilling activity in the Bakken. Full year 2024 E&P capital and
exploratory expenditures are expected to be approximately $4.2
billion, which includes the recent acquisition of leases from the
Gulf of Mexico Lease Sale 261.
Midstream capital expenditures were $72
million in the fourth quarter of 2023 and $63 million in the
prior-year quarter.
Liquidity:
Excluding the Midstream segment, Hess
Corporation had cash and cash equivalents of $1.7 billion and debt
and finance lease obligations totaling $5.6 billion at December 31,
2023. The Midstream segment had cash and cash equivalents of $6
million and total debt of $3.2 billion at December 31, 2023. The
Corporation’s debt to capitalization ratio as defined in its debt
covenants was 33.6% at December 31, 2023 and 36.1% at December 31,
2022.
Net cash provided by operating activities was
$1,344 million in the fourth quarter of 2023, compared with $1,252
million in the fourth quarter of 2022. Net cash provided by
operating activities before changes in operating assets and
liabilities3 was $1,239 million in the fourth quarter of 2023,
compared with $1,301 million in the prior-year quarter.
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
Year Ended
December 31,
December 31,
(unaudited)
(unaudited)
2023
2022
2023
2022
(In millions)
Exploration and Production
$
(19)
$
76
$
(101)
$
22
Midstream
—
—
—
—
Corporate, Interest and Other
(69)
(101)
(69)
(102)
Total items affecting comparability of
earnings between periods
$
(88)
$
(25)
$
(170)
$
(80)
Fourth Quarter 2023: E&P results included
a pre-tax charge of $52 million ($52 million after income taxes) to
write-off the Huron exploration well in the Gulf of Mexico which
completed in 2022, based on the decision by the Corporation and its
partners in the fourth quarter of 2023 to exit the project. E&P
results also included a noncash income tax benefit of $33 million
resulting from the reversal of a valuation allowance against net
deferred tax assets in Malaysia.
Corporate and other results included a pre-tax
charge of $52 million ($52 million after income taxes) for
litigation related costs associated with the Corporation's former
downstream business, HONX, Inc., which are included in General and
administrative expenses in the income statement. Corporate and
other results also included a noncash charge to recognize
unamortized pension actuarial losses of $17 million ($17 million
after income taxes) resulting from the payment of lump sums to
certain participants in the pension plan. The charge is included in
Other, net in the income statement.
Fourth Quarter 2022: E&P results included
a pre-tax gain of $76 million ($76 million after income taxes)
associated with the sale of the Corporation's interest in the Waha
Concession in Libya. Corporate and other results included a pre-tax
charge of $101 million ($101 million after income taxes) for
litigation related costs associated with the Corporation's former
downstream business, HONX, Inc., which are included in General and
administrative expenses in the income statement.
2.
Net production from Guyana included 16,000
bopd of tax barrels in the fourth quarter of 2023 and 22,000 bopd
of tax barrels in the fourth quarter of 2022.
3.
“Net cash provided by (used in) operating
activities before changes in operating assets and liabilities” is a
non-GAAP financial measure. The reconciliation to its nearest GAAP
equivalent measure, and its definition, appear on pages 6 and 7,
respectively.
Reconciliation of U.S. GAAP to Non-GAAP Measures:
The following table reconciles reported net
income attributable to Hess Corporation and adjusted net
income:
Three Months Ended
Year Ended
December 31,
December 31,
(unaudited)
(unaudited)
2023
2022
2023
2022
(In millions)
Net income attributable to Hess
Corporation
$
413
$
497
$
1,382
$
2,096
Less: Total items affecting comparability
of earnings between periods
(88)
(25)
(170)
(80)
Adjusted net income attributable to Hess
Corporation
$
501
$
522
$
1,552
$
2,176
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
Year Ended
December 31,
December 31,
(unaudited)
(unaudited)
2023
2022
2023
2022
(In millions)
Net cash provided by (used in) operating
activities before changes in operating assets and liabilities
$
1,239
$
1,301
$
4,494
$
5,121
Changes in operating assets and
liabilities
105
(49)
(552)
(1,177)
Net cash provided by (used in) operating
activities
$
1,344
$
1,252
$
3,942
$
3,944
Investor Conference Call:
Due to the pending merger with Chevron
Corporation (Chevron), the Corporation will not host a conference
call to review its fourth quarter 2023 results.
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; information about sustainability goals and targets and
planned social, safety and environmental policies, programs and
initiatives; future economic and market conditions in the oil and
gas industry; and expected timing and completion of our proposed
merger with Chevron.
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; reduced demand for our
products, including due to perceptions regarding the oil and gas
industry, 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, fracking bans as well as restrictions on oil and gas
leases; operational changes and expenditures due to climate change
and sustainability related initiatives; disruption or interruption
of our operations due to catastrophic and other events, such as
accidents, severe weather, geological events, shortages of skilled
labor, cyber-attacks, public health measures, or climate change;
the ability of our contractual counterparties to satisfy their
obligations to us, including the operation of joint ventures under
which we may not control and exposure to decommissioning
liabilities for divested assets in the event the current or future
owners are unable to perform; 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
limitations on investment in oil and gas activities, rising
interest rates or negative outcomes within commodity and financial
markets; liability resulting from environmental obligations and
litigation, including heightened risks associated with being a
general partner of HESM; risks and uncertainties associated with
our proposed merger with Chevron; 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” presented
in this release is defined as reported net income 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 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 or net cash provided by (used in) operating
activities. A reconciliation of reported net income attributable to
Hess Corporation (U.S. GAAP) to adjusted net income, 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)
Fourth
Fourth
Third
Quarter
Quarter
Quarter
2023
2022
2023
Income
Statement
Revenues and non-operating
income
Sales and other operating revenues
$
3,011
$
2,934
$
2,800
Gains on asset sales, net
—
76
2
Other, net
24
44
35
Total revenues and non-operating
income
3,035
3,054
2,837
Costs and expenses
Marketing, including purchased oil and
gas
886
821
696
Operating costs and expenses
473
385
467
Production and severance taxes
61
55
61
Exploration expenses, including dry holes
and lease impairment
87
74
65
General and administrative expenses
168
217
115
Interest expense
116
124
117
Depreciation, depletion and
amortization
559
504
499
Total costs and expenses
2,350
2,180
2,020
Income before income taxes
685
874
817
Provision for income taxes
182
292
215
Net income
503
582
602
Less: Net income attributable to
noncontrolling interests
90
85
98
Net income attributable to Hess
Corporation
$
413
$
497
$
504
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
Year Ended
December 31,
Income
Statement
2023
2022
Revenues and non-operating
income
Sales and other operating revenues
$
10,511
$
11,324
Gains on asset sales, net
2
101
Other, net
132
145
Total revenues and non-operating
income
10,645
11,570
Costs and expenses
Marketing, including purchased oil and
gas
2,732
3,328
Operating costs and expenses
1,776
1,452
Production and severance taxes
216
255
Exploration expenses, including dry holes
and lease impairment
317
208
General and administrative expenses
527
531
Interest expense
478
493
Depreciation, depletion and
amortization
2,046
1,703
Impairment and other
82
54
Total costs and expenses
8,174
8,024
Income before income taxes
2,471
3,546
Provision for income taxes
733
1,099
Net income
1,738
2,447
Less: Net income attributable to
noncontrolling interests
356
351
Net income attributable to Hess
Corporation
$
1,382
$
2,096
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
December 31,
December 31,
2023
2022
Balance Sheet
Information
Assets
Cash and cash equivalents
$
1,688
$
2,486
Other current assets
1,742
1,445
Property, plant and equipment – net
17,432
15,098
Operating lease right-of-use assets –
net
720
570
Finance lease right-of-use assets –
net
108
126
Other long-term assets
2,317
1,970
Total assets
$
24,007
$
21,695
Liabilities and equity
Current portion of long-term debt
$
311
$
3
Current portion of operating and finance
lease obligations
370
221
Other current liabilities
2,589
2,172
Long-term debt
8,302
8,278
Long-term operating lease obligations
459
469
Long-term finance lease obligations
156
179
Other long-term liabilities
2,218
1,877
Total equity excluding other comprehensive
income (loss)
9,120
7,986
Accumulated other comprehensive income
(loss)
(134)
(131)
Noncontrolling interests
616
641
Total liabilities and equity
$
24,007
$
21,695
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
December 31,
December 31,
2023
2022
Total
Debt
Hess Corporation
$
5,402
$
5,395
Midstream (a)
3,211
2,886
Hess Consolidated
$
8,613
$
8,281
(a) Midstream debt is non-recourse to Hess
Corporation.
December 31,
December 31,
2023
2022
Debt to
Capitalization Ratio (a)
Hess Consolidated
47.8 %
50.0 %
Hess Corporation as defined in debt
covenants
33.6 %
36.1 %
(a) Includes finance lease
obligations.
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
Interest
Expense
Gross interest expense – Hess
Corporation
$
88
$
87
$
347
$
353
Less: Capitalized interest – Hess
Corporation
(19)
(4)
(48)
(10)
Interest expense – Hess Corporation
69
83
299
343
Interest expense – Midstream (a)
47
41
179
150
Interest expense – Hess
Consolidated
$
116
$
124
$
478
$
493
(a) Midstream interest expense is reported in the Midstream
operating segment.
HESS CORPORATION AND CONSOLIDATED
SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
Fourth
Fourth
Third
Quarter
Quarter
Quarter
2023
2022
2023
Cash Flow
Information
Cash Flows from Operating
Activities
Net income
$
503
$
582
$
602
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
(Gains) losses on asset sales, net
—
(76)
(2)
Depreciation, depletion and
amortization
559
504
499
Exploratory dry hole costs
50
37
4
Exploration lease impairment
3
6
11
Pension settlement loss
17
—
—
Stock compensation expense
18
17
16
Noncash (gains) losses on commodity
derivatives, net
52
165
52
Provision (benefit) for deferred income
taxes and other tax accruals
37
66
67
Net cash provided by (used in) operating
activities before changes in operating assets and liabilities
1,239
1,301
1,249
Changes in operating assets and
liabilities
105
(49)
(263)
Net cash provided by (used in) operating
activities
1,344
1,252
986
Cash Flows from Investing
Activities
Additions to property, plant and equipment
- E&P
(1,380)
(732)
(953)
Additions to property, plant and equipment
- Midstream
(64)
(61)
(53)
Proceeds from asset sales, net of cash
sold
—
150
3
Other, net
(3)
(4)
(1)
Net cash provided by (used in) investing
activities
(1,447)
(647)
(1,004)
Cash Flows from Financing
Activities
Net borrowings (repayments) of debt with
maturities of 90 days or less
64
(25)
78
Debt with maturities of greater than 90
days:
Borrowings
—
—
—
Repayments
(3)
—
—
Cash dividends paid
(134)
(115)
(134)
Common stock acquired and retired
—
(290)
—
Noncontrolling interests, net
(151)
(80)
(136)
Employee stock options exercised
—
8
6
Payments on finance lease obligations
(3)
(4)
(3)
Other, net
—
3
(1)
Net cash provided by (used in) financing
activities
(227)
(503)
(190)
Net Increase (Decrease) in Cash and
Cash Equivalents
(330)
102
(208)
Cash and Cash Equivalents at Beginning
of Period
2,018
2,384
2,226
Cash and Cash Equivalents at End of
Period
$
1,688
$
2,486
$
2,018
Additions to
Property, Plant and Equipment included within Investing
Activities
Capital expenditures incurred
$
(1,518)
$
(850)
$
(1,013)
Increase (decrease) in related
liabilities
74
57
7
Additions to property, plant and
equipment
$
(1,444)
$
(793)
$
(1,006)
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
Year Ended
December 31,
2023
2022
Cash Flow
Information
Cash Flows from Operating
Activities
Net income
$
1,738
$
2,447
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
(Gains) losses on asset sales, net
(2)
(101)
Depreciation, depletion and
amortization
2,046
1,703
Impairment and other
82
54
Exploratory dry hole costs
147
56
Exploration lease impairment
27
20
Pension settlement loss
17
2
Stock compensation expense
87
83
Noncash (gains) losses on commodity
derivatives, net
156
548
Provision (benefit) for deferred income
taxes and other tax accruals
196
309
Net cash provided by (used in) operating
activities before changes in operating assets and liabilities
4,494
5,121
Changes in operating assets and
liabilities
(552)
(1,177)
Net cash provided by (used in) operating
activities
3,942
3,944
Cash Flows from Investing
Activities
Additions to property, plant and equipment
- E&P
(3,884)
(2,487)
Additions to property, plant and equipment
- Midstream
(224)
(238)
Proceeds from asset sales, net of cash
sold
3
178
Other, net
(8)
(8)
Net cash provided by (used in) investing
activities
(4,113)
(2,555)
Cash Flows from Financing
Activities
Net borrowings (repayments) of debt with
maturities of 90 days or less
322
(86)
Debt with maturities of greater than 90
days:
Borrowings
—
420
Repayments
(3)
(510)
Cash dividends paid
(539)
(465)
Common stock acquired and retired
(20)
(630)
Proceeds from sale of Class A shares of
Hess Midstream LP
167
146
Noncontrolling interests, net
(550)
(510)
Employee stock options exercised
10
52
Payments on finance lease obligations
(10)
(9)
Other, net
(4)
(24)
Net cash provided by (used in) financing
activities
(627)
(1,616)
Net Increase (Decrease) in Cash and
Cash Equivalents
(798)
(227)
Cash and Cash Equivalents at Beginning
of Year
2,486
2,713
Cash and Cash Equivalents at End of
Year
$
1,688
$
2,486
Additions to
Property, Plant and Equipment included within Investing
Activities
Capital expenditures incurred
$
(4,279)
$
(2,821)
Increase (decrease) in related
liabilities
171
96
Additions to property, plant and
equipment
$
(4,108)
$
(2,725)
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA
(UNAUDITED)
(IN MILLIONS)
Fourth
Fourth
Third
Quarter
Quarter
Quarter
2023
2022
2023
Capital and
Exploratory Expenditures
E&P Capital and exploratory
expenditures
United States
North Dakota
$
313
$
258
$
329
Offshore and Other
64
39
115
Total United States
377
297
444
Guyana
1,047
439
509
Malaysia and JDA
55
58
43
Other (a)
1
24
2
E&P Capital and exploratory
expenditures
$
1,480
$
818
$
998
Total exploration expenses charged to
income included above
$
34
$
31
$
50
Midstream Capital expenditures
$
72
$
63
$
65
(a) Other includes capital and exploratory
expenditures associated with Suriname in the fourth quarter of
2022.
Year Ended
December 31,
2023
2022
Capital and
Exploratory Expenditures
E&P Capital and exploratory
expenditures
United States
North Dakota
$
1,138
$
807
Offshore and Other
290
224
Total United States
1,428
1,031
Guyana
2,518
1,345
Malaysia and JDA
189
275
Other (a)
41
70
E&P Capital and exploratory
expenditures
$
4,176
$
2,721
Total exploration expenses charged to
income included above
$
143
$
132
Midstream Capital expenditures
$
246
$
232
(a) Other includes capital and exploratory expenditures associated
with Canada in 2023 and Suriname in 2022.
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
EARNINGS (UNAUDITED)
(IN MILLIONS)
Fourth Quarter 2023
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
1,766
$
1,240
$
3,006
Other, net
11
5
16
Total revenues and non-operating
income
1,777
1,245
3,022
Costs and expenses
Marketing, including purchased oil and gas
(a)
867
40
907
Operating costs and expenses
229
159
388
Production and severance taxes
56
5
61
Midstream tariffs
328
—
328
Exploration expenses, including dry holes
and lease impairment
82
5
87
General and administrative expenses
53
8
61
Depreciation, depletion and
amortization
255
253
508
Total costs and expenses
1,870
470
2,340
Results of operations before income
taxes
(93)
775
682
Provision for income taxes
—
170
170
Net income (loss) attributable to Hess
Corporation
$
(93)
(b)
$
605
(c)
$
512
Fourth Quarter 2022
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
1,628
$
1,306
$
2,934
Gains on asset sales, net
—
76
76
Other, net
13
8
21
Total revenues and non-operating
income
1,641
1,390
3,031
Costs and expenses
Marketing, including purchased oil and gas
(a)
771
63
834
Operating costs and expenses
193
129
322
Production and severance taxes
52
3
55
Midstream tariffs
297
—
297
Exploration expenses, including dry holes
and lease impairment
33
41
74
General and administrative expenses
55
11
66
Depreciation, depletion and
amortization
215
243
458
Total costs and expenses
1,616
490
2,106
Results of operations before income
taxes
25
900
925
Provision for income taxes
—
284
284
Net income (loss) attributable to Hess
Corporation
$
25
(d)
$
616
(e)
$
641
(a) Includes amounts charged from the Midstream segment. (b)
Includes after-tax losses from realized crude oil hedging
activities of $34 million (noncash premium amortization: $34
million; cash settlement: $0 million). (c) Includes after-tax
losses from realized crude oil hedging activities of $18 million
(noncash premium amortization: $18 million; cash settlement: $0
million). (d) Includes after-tax losses from realized crude oil
hedging activities of $100 million (noncash premium amortization:
$100 million; cash settlement: $0 million). (e) Includes after-tax
losses from realized crude oil hedging activities of $65 million
(noncash premium amortization: $65 million; cash settlement: $0
million).
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
EARNINGS (UNAUDITED)
(IN MILLIONS)
Third Quarter 2023
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
1,651
$
1,147
$
2,798
Other, net
4
8
12
Total revenues and non-operating
income
1,655
1,155
2,810
Costs and expenses
Marketing, including purchased oil and gas
(a)
693
26
719
Operating costs and expenses
226
158
384
Production and severance taxes
59
2
61
Midstream tariffs
332
—
332
Exploration expenses, including dry holes
and lease impairment
45
20
65
General and administrative expenses
56
10
66
Depreciation, depletion and
amortization
234
217
451
Total costs and expenses
1,645
433
2,078
Results of operations before income
taxes
10
722
732
Provision for income taxes
—
203
203
Net income (loss) attributable to Hess
Corporation
$
10
(b)
$
519
(c)
$
529
(a) Includes amounts charged from the Midstream segment. (b)
Includes after-tax losses from realized crude oil hedging
activities of $33 million (noncash premium amortization: $33
million; cash settlement: $0 million). (c) Includes after-tax
losses from realized crude oil hedging activities of $19 million
(noncash premium amortization: $19 million; cash settlement: $0
million).
HESS CORPORATION AND
CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
EARNINGS (UNAUDITED)
(IN MILLIONS)
Year Ended December 31, 2023
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
6,081
$
4,419
$
10,500
Other, net
30
20
50
Total revenues and non-operating
income
6,111
4,439
10,550
Costs and expenses
Marketing, including purchased oil and gas
(a)
2,681
128
2,809
Operating costs and expenses
901
578
1,479
Production and severance taxes
206
10
216
Midstream tariffs
1,245
—
1,245
Exploration expenses, including dry holes
and lease impairment
170
147
317
General and administrative expenses
213
41
254
Depreciation, depletion and
amortization
904
948
1,852
Impairment and other
82
—
82
Total costs and expenses
6,402
1,852
8,254
Results of operations before income
taxes
(291)
2,587
2,296
Provision for income taxes
—
695
695
Net income (loss) attributable to Hess
Corporation
$
(291)
(b)
$
1,892
(c)
$
1,601
Year Ended December 31, 2022
Income
Statement
United States
International
Total
Total revenues and non-operating
income
Sales and other operating revenues
$
7,214
$
4,110
$
11,324
Gains on asset sales, net
—
76
76
Other, net
81
21
102
Total revenues and non-operating
income
7,295
4,207
11,502
Costs and expenses
Marketing, including purchased oil and gas
(a)
3,271
123
3,394
Operating costs and expenses
706
480
1,186
Production and severance taxes
242
13
255
Midstream tariffs
1,193
—
1,193
Exploration expenses, including dry holes
and lease impairment
122
86
208
General and administrative expenses
189
35
224
Depreciation, depletion and
amortization
810
710
1,520
Impairment and other
54
—
54
Total costs and expenses
6,587
1,447
8,034
Results of operations before income
taxes
708
2,760
3,468
Provision for income taxes
—
1,072
1,072
Net income (loss) attributable to Hess
Corporation
$
708
(d)
$
1,688
(e)
$
2,396
(a) Includes amounts charged from the
Midstream segment.
(b) Includes after-tax losses from
realized crude oil hedging activities of $128 million (noncash
premium amortization: $128 million; cash settlement: $0
million).
(c) Includes after-tax losses from
realized crude oil hedging activities of $62 million (noncash
premium amortization: $62 million; cash settlement: $0
million).
(d) Includes after-tax losses from
realized crude oil hedging activities of $356 million (noncash
premium amortization: $333 million; cash settlement: $23
million).
(e) Includes after-tax losses from
realized crude oil hedging activities of $229 million (noncash
premium amortization: $215 million; cash settlement: $14
million).
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
Fourth
Fourth
Third
Quarter
Quarter
Quarter
2023
2022
2023
Net Production
Per Day (in thousands)
Crude oil - barrels
United States
North Dakota
89
74
87
Offshore
21
25
21
Total United States
110
99
108
Guyana (a)
128
116
108
Malaysia and JDA
6
4
5
Other (b)
—
9
—
Total
244
228
221
Natural gas liquids - barrels
United States
North Dakota
71
60
70
Offshore
2
2
1
Total United States
73
62
71
Natural gas - mcf
United States
North Dakota
204
143
195
Offshore
42
50
37
Total United States
246
193
232
Malaysia and JDA
362
377
383
Other (b)
—
6
—
Total
608
576
615
Barrels of oil equivalent
418
386
395
(a) Production from Guyana includes 16,000 bopd of tax barrels in
the fourth quarter of 2023, 22,000 bopd of tax barrels in the
fourth quarter of 2022 and 14,000 bopd of tax barrels in the third
quarter of 2023. (b) Other includes production from Libya. The
Corporation sold its interest in the Waha Concession in Libya in
November 2022. Libya net production was 10,000 boepd in the fourth
quarter of 2022.
HESS CORPORATION AND CONSOLIDATED
SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
Year Ended
December 31,
2023
2022
Net Production
Per Day (in thousands)
Crude oil - barrels
United States
North Dakota
83
75
Offshore
22
22
Total United States
105
97
Guyana (a)
115
78
Malaysia and JDA
5
4
Other (b)
—
15
Total
225
194
Natural gas liquids - barrels
United States
North Dakota
67
53
Offshore
2
2
Total United States
69
55
Natural gas - mcf
United States
North Dakota
191
156
Offshore
43
44
Total United States
234
200
Malaysia and JDA
368
360
Other (b)
—
10
Total
602
570
Barrels of oil equivalent
394
344
(a) Production from Guyana includes 14,000 bopd of tax barrels in
2023 and 7,000 bopd in 2022. (b) Other includes production from
Libya. The Corporation sold its interest in the Waha Concession in
Libya in November 2022. Libya net production was 17,000 boepd in
2022.
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
Fourth
Fourth
Third
Quarter
Quarter
Quarter
2023
2022
2023
Sales Volumes Per
Day (in thousands) (a)
Crude oil – barrels
245
242
223
Natural gas liquids – barrels
74
63
71
Natural gas – mcf
608
576
615
Barrels of oil equivalent
420
401
397
Sales Volumes (in
thousands) (a)
Crude oil – barrels
22,521
22,218
20,519
Natural gas liquids – barrels
6,839
5,825
6,500
Natural gas – mcf
55,957
52,949
56,553
Barrels of oil equivalent
38,686
36,868
36,445
Year Ended
December 31,
2023
2022
Sales Volumes Per
Day (in thousands) (a)
Crude oil – barrels
225
191
Natural gas liquids – barrels
69
54
Natural gas – mcf
602
570
Barrels of oil equivalent
394
340
Sales Volumes (in
thousands) (a)
Crude oil – barrels
81,941
69,679
Natural gas liquids – barrels
25,184
19,843
Natural gas – mcf
219,750
208,001
Barrels of oil equivalent
143,750
124,189
(a) Sales volumes from purchased crude oil, natural gas liquids,
and natural gas are not included in the sales volumes reported.
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
Fourth
Fourth
Third
Quarter
Quarter
Quarter
2023
2022
2023
Average Selling
Prices
Crude oil - per barrel (including
hedging)
United States
North Dakota
$
70.69
$
68.52
$
76.06
Offshore
73.68
69.07
78.50
Total United States
71.28
68.65
76.56
Guyana
81.50
80.77
86.24
Malaysia and JDA
73.44
80.41
87.21
Other (a)
—
86.83
—
Worldwide
76.63
76.07
81.53
Crude oil - per barrel (excluding
hedging)
United States
North Dakota
$
74.03
$
79.47
$
79.43
Offshore
76.98
79.99
81.86
Total United States
74.62
79.60
79.92
Guyana
83.09
85.93
88.06
Malaysia and JDA
73.44
80.41
87.21
Other (a)
—
91.60
—
Worldwide
78.95
83.50
84.07
Natural gas liquids - per
barrel
United States
North Dakota
$
20.95
$
26.95
$
20.17
Offshore
19.26
26.13
20.15
Worldwide
20.92
26.93
20.17
Natural gas - per mcf
United States
North Dakota
$
1.52
$
4.68
$
1.56
Offshore
2.26
4.98
2.35
Total United States
1.65
4.76
1.69
Malaysia and JDA
6.45
5.34
6.32
Other (a)
—
7.48
—
Worldwide
4.51
5.17
4.57
(a) Other includes prices related to production from Libya. The
Corporation sold its interest in the Waha Concession in Libya in
November 2022.
HESS CORPORATION AND CONSOLIDATED
SUBSIDIARIES
EXPLORATION AND PRODUCTION
OPERATING DATA
Year Ended
December 31,
2023
2022
Average Selling
Prices
Crude oil - per barrel (including
hedging)
United States
North Dakota
$
70.44
$
81.06
Offshore
72.06
81.38
Total United States
70.80
81.14
Guyana
80.72
89.86
Malaysia and JDA
75.51
89.77
Other (a)
—
93.67
Worldwide
75.97
85.76
Crude oil - per barrel (excluding
hedging)
United States
North Dakota
$
73.80
$
91.26
Offshore
75.39
91.51
Total United States
74.15
91.32
Guyana
82.20
96.52
Malaysia and JDA
75.51
89.77
Other (a)
—
101.92
Worldwide
78.29
94.15
Natural gas liquids - per
barrel
United States
North Dakota
$
20.77
$
35.09
Offshore
20.87
35.24
Worldwide
20.77
35.09
Natural gas - per mcf
United States
North Dakota
$
1.68
$
5.50
Offshore
2.16
6.21
Total United States
1.76
5.66
Malaysia and JDA
5.95
5.62
Other (a)
—
5.93
Worldwide
4.32
5.64
(a) Other includes prices related to production from Libya. The
Corporation sold its interest in the Waha Concession in Libya in
November 2022.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240131222227/en/
For Hess Corporation
Investor Contact: Jay Wilson (212) 536-8940
Media Contacts: Lorrie Hecker (212) 536-8250
Liz James FGS Global (281) 881-5170
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