Hess Corp., a leading energy company, announced on Wednesday that it had achieved impressive financial results for the third quarter of the year. Despite facing lower prices, increased oil and gas production contributed to the company's net income of $504 million during the latest quarter.
Robust Production Numbers
Hess saw a significant boost in production, averaging 395,000 barrels of oil equivalent per day (boe/d) in Q3 2023, compared to 351,000 boe/d during the same period last year. This increase in production was largely driven by the company's assets in the Bakken play, where output grew from 166,000 boe/d to 190,000 boe/d. Additionally, production in Guyana rose from 98,000 barrels of oil per day to 108,000 b/d, while Southeast Asia experienced an increase from 57,000 boe/d to 69,000 boe/d. However, production in the Gulf of Mexico saw a slight decline from 30,000 boe/d to 28,000 boe/d.
Net income for the quarter amounted to $504 million or $1.64 per share. Although slightly lower than the $515 million reported in Q3 2022 ($1.67 per share), these results demonstrate the company's resilience despite market challenges.
Hess revealed that its crude sales generated an average price of $81.53 per barrel during Q3 2023, down from $85.32 per barrel in the same period last year. Similarly, the average realized natural gas liquids price was $20.17 per barrel, compared to $35.44 per barrel in Q3 2022. The average natural gas selling price also declined to $4.57 per thousand cubic feet (mcf), down from $5.85 per mcf in the previous year.
Strategic Deal with Chevron
Hess officials decided to cancel a scheduled call with analysts to discuss the quarterly results following the announcement on Monday that Chevron would acquire the company through an all-stock transaction valued at $53 billion. This strategic deal, set to close in the first quarter of next year, signifies a significant milestone for both corporations.
The strong production numbers and noteworthy financial performance have prompted Hess to revise its production outlook for 2023. The company now expects production to average 390,000 boe/d, aligning with the upper end of its previously forecasted range of 385,000-390,000 boe/d.
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