Amerada Hess Reports First Quarter 2004 Results

Amerada Hess Corporation (NYSE: AHC) reported net income of $281 million for the first quarter of 2004 compared with income of $176 million for the first quarter of 2003. First quarter 2004 income includes a net gain of $19 million from the sale of an asset and an income tax benefit of $13 million resulting from the completion of a prior year United States income tax audit. First quarter 2003 income included a net gain of $31 million from the sale of an asset. The after-tax results by major operating activity in 2004 and 2003 are as follows:


                                                         Three months ended
                                                        March 31 (unaudited)
                                                     2004              2003(*)
                                                        (In millions, except
                                                        per share amounts)
    Exploration and production                        $207              $120
    Refining and marketing                             112               136
    Corporate                                           (2)              (20)
    Interest expense                                   (36)              (46)
    Income from continuing operations                  281               190
    Discontinued operations                              -               (21)
    Income from cumulative effect of
     accounting change                                   -                 7
    Net income                                        $281              $176
    Income per share from continuing
     operations (diluted)                            $2.77             $2.13
    Net income per share (diluted)                   $2.77             $1.98

    (*) Reclassified to conform with current period presentation.


Exploration and production earnings were $207 million in the first quarter of 2004 compared with $120 million in the first quarter of 2003. The Corporation's oil and gas production, on a barrel-of-oil equivalent basis, was 346,000 barrels per day in the first quarter of 2004, a decrease of 18% from the first quarter of 2003. Approximately 60% of the decline in production resulted from asset sales and exchanges in 2003. In the first quarter of 2004, the Corporation's average worldwide crude oil selling price, including the effect of hedging, was $26.83 per barrel, an increase of $1.64 per barrel from the first quarter of 2003. The Corporation's average United States natural gas selling price, including the effect of hedging, was $5.20 per Mcf in the first quarter of 2004, an increase of $.77 per Mcf from the first quarter of 2003. Exploration and production earnings include after-tax gains from asset sales of $19 million and $31 million ($19 million and $47 million before income taxes) in the first quarters of 2004 and 2003, respectively. The gain in the first quarter of 2004 reflects the sale of an office building in Aberdeen, Scotland.

Refining and marketing earnings were $112 million in the first quarter of 2004 compared with $136 million in the first quarter of 2003. The decrease reflects lower earnings from retail gasoline station operations and energy marketing activities, partially offset by increased earnings from refining operations.

Capital expenditures in the first quarter of 2004 amounted to $364 million of which $352 million related to exploration and production activities. Capital expenditures in the first quarter of 2003 amounted to $341 million, including $321 million for exploration and production.
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