Hess: 07 Oil, Gas Output to Reach 370,000-380,000 BOE/D

HOUSTON Jan 31, 2007 (Dow Jones Newswires)

Hess Corp. (HES) will raise its 2007 oil and gas output to between 370,000 and 380,000 barrels per day, up from 359,000 barrels per day in 2006, company executives said Wednesday.

The forecast is "within our previous guidance of 3% to 5% growth per year," said Chief Executive John Hess during a conference call with analysts.

The production increase follows the recent start-up of major projects such as Okume complex in Equatorial Guinea, and the progress in the development of the Genghis Khan field in the Gulf of Mexico, which New York-based Hess agreed to acquire from Anadarko Petroleum Corp. (APC) in December.

"In the third quarter we expect to start production from Genghis Khan," said John O'Connor, head of worldwide exploration and production for Hess.

Production at the Okume field will plateau in early 2008, O'Connor said.

In 2006, the company booked 310 million barrels of new reserves, adding the equivalent of 230% of reserves produced during the year. More than half of the additions occurred in existing Hess assets, but 125 million new barrels come from the company's return to its Libyan operations, O'Connor said.

Hess' partnership with Venezuela in the Hovensa refinery "continues to be excellent," despite the Venezuelan government's recent steps toward increasing economic nationalism, Hess said. The Venezuelans have honored their supply agreements on crude to the refinery, located in the U.S. Virgin Islands, and "both partners continue to be supportive of the joint venture," he said.

Copyright (c) 2007 Dow Jones & Company, Inc.

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