Hess Slashes 2017 Capital Budget After Quarterly Loss
July 26 (Reuters) - U.S. oil producer Hess Corp slashed its 2017 capital budget by 4 percent on Wednesday after posting a wider-than-expected quarterly loss on low crude prices and a dip in production.
Hess, which now plans to spend $2.15 billion this year, becomes the second major U.S. oil producer to cut its capex after rival Anadarko Petroleum Corp did so earlier this week.
Like many of its peers, Hess is struggling to adapt to the dip in oil prices this year, which was not expected when 2017 capital budgets were crafted.
Despite the weak results and oil price environment, Chief Executive John Hess touted the company's growth potential, citing process and technology improvements.
In North Dakota's Bakken shale, for instance, the company expects output to grow 10 percent per year "over the next several years," Hess said. It now takes four rigs in North Dakota to do what took six rigs just a year ago, he added.
"We believe our company has the best long-term growth outlook in our history as well as one of the best in the industry," Hess said on a conference call with investors.
The company, which also operates in the U.S. Gulf of Mexico and the Gulf of Thailand, posted a net loss of $449 million, or $1.46 per share, in the reported quarter, compared with a loss of $392 million, or $1.29 per share, a year earlier.
Excluding one-time items, Hess lost $1.41 per share. By that measure, analysts expected a loss of $1.34 per share, according to Thomson Reuters I/B/E/S.
The company said losses in the exploration and production unit - its biggest - climbed to $354 million in the second quarter ended June 30, from $328 million a year earlier.
Net production fell to 294,000 barrels of oil equivalent per day (boepd) from 313,000 boepd.
Hess's revenue fell to $1.23 billion from $1.27 billion.
Shares of New York-based Hess fell 0.5 percent to $45.13 in midday trading after falling as much as 4 percent earlier in the session.
(Reporting by Ernest Scheyder in Houston and Yashaswini Swamynathan in Bengaluru; Editing by Amrutha Gayathri and Nick Zieminski)
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