Hess Divests Stake in Deepwater Field

Hess Corp. (NYSE: HES) reported Friday that it has completed the sale of its 28-percent working interest in the Shenzi Field in the deepwater Gulf of Mexico (GOM) to operator BHP (NYSE: BHP).

“This transaction brings value forward in the current low price environment and further strengthens our cash and liquidity position,” remarked Hess CEO John Hess in a written statement emailed to Rigzone. “Proceeds will be used to fund our world class investment opportunity in Guyana.”

Hess owns a 30-percent stake in the Stabroek Block offshore Guyana. Exxon Mobil Corp. (NYSE: XOM) operates Stabroek.

As Rigzone reported in early October, the $505 million transaction brings BHP’s working interest in the six-lease development to 72 percent. Repsol S.A. (OTCMKTS: REPYY) holds the remaining 28 percent. BHP noted at the time that the deal will immediately add roughly 11,000 barrels of oil equivalent per day of production – 90 percent of it oil.

“We are purchasing the stake in Shenzi at an attractive price, it’s a tier one asset with optionality and key to BHP’s Gulf of Mexico heartland,” Geraldine Slattery, BHP’s president for petroleum operations, pointed out last month. “As the operator, we have more opportunity to grow Shenzi high-margin barrels and value with an increased working interest.”

To contact the author, email mveazey@rigzone.com.