Hess Corp. said its capital and exploratory budget for 2013 is 18% smaller than last year's expenditures, as the oil-and-gas company looks to again spend most of the funds of exploration and production.
The company's 2013 budget is $6.8 billion, down from $8.3 billion spent in 2012. Last January, the company initially set its capital budget for the year at $6.8 billion as well.
Of the $6.7 billion budgeted this year for exploration and production, $2.7 billion is dedicated to unconventional shale resources and the rest is focused on conventional resources--with $1.85 billion for production, $1.6 billion for development and $550 million for exploration. As in past years, $100 million is set aside for marketing and refining and corporate needs.
"Our corporation's capital and exploratory budget for 2013 is focused on attractive investment opportunities and consistent with our plan, announced in July 2012, to significantly reduce overall expenditures in 2013," Chief Executive John Hess said.
Hess has been pruning its portfolio to fund drilling and exploration efforts, recently reaching a deal for $525 million from Royal Dutch Shell PLC for its stake in the Beryl area fields in the U.K. North Sea and the Scottish Area Gas Evacuation System. In September, Hess agreed to sell some minority stakes it holds in fields in Azerbaijan to India's ONGC Videsh Ltd. for $1 billion.
In November, the company said its third-quarter earnings rose 87% due in part to asset-sale gains, while Hess's revenue grew more than expected on improved selling prices and production.
Copyright (c) 2012 Dow Jones & Company, Inc.
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