Guyana’s prolific offshore Stabroek Block continues to boost production to the benefit of an Exxon Mobil-led consortium that includes Hess Corp. and China National Offshore Oil Corp. (CNOOC). Meanwhile, Chevron Corp. looks on with its fingers crossed that its $53 billion offer to acquire Hess makes it across the finish line.

“[The] focus remains on execution ahead of the pending Chevron deal, which would likely reach closing in 2025 if the deal moves forward,” David Deckelbaum, TD Cowen managing director, wrote in a commentary. Lawyers from Chevron continue to work with Exxon Mobil and CNOOC, both of which claim they have a right of first refusal (ROFR) to Hess’ 30% interest in Stabroek.


Exxon Versus Chevron: The Fight for Hess’ 30% Guyana Interest

Guyana lifts Hess production, net income

Hess net production averaged 476,000 boe/d in first-quarter 2024, up about 27% compared to 374,000 boe/d in first-quarter 2023, owing mainly to rising production in Guyana and the Bakken play, the company reported in its April 25 earnings release.

Hess expects its net production in second-quarter 2024 to come in between 465,000 boe/d to 475,000 boe/d, reflecting planned maintenance in the U.S. Gulf of Mexico (GoM) that will partially be offset by growth in the Bakken.

Hess’ net production from Guyana averaged 190,000 bbl/d in first-quarter 2024, up 70% from 112,000 bbl/d in first-quarter 2023. This compares to net Bakken production that averaged 190,000 boe/d in the first quarter 2024, up 17% from 163,000 boe/d in the first quarter 2023.

Hess reported net income of $972 million in first-quarter 2024 compared to $346 million in first-quarter 2023, thanks to higher production and prices.

E&P capex was $927 million in first-quarter 2024 compared to $765 million during the same period last year, Hess said. 

Guyana surpasses

Hess’ net production offshore Guyana rose as another FPSO was brought online in the Stabroek Block.

Payara, the third Stabroek development, commenced production in November 2023 and reached its initial production capacity of 220,000 gross bbl/d in January 2024.

Deckelbaum said Guyana's production of 190,000 bbl/d in the first quarter compared to consensus estimates of 148,000 bbl/d. That implies all three actively producing FPSOs were producing “at or beyond stated capacity for the majority of the first-quarter… Liza 1 at 150,000 bbl/d; Liza 2 at 250,000 bbl/; and most recently, Payara at 220,000 bbl/d.”

Additionally, Hess said it sold 15 oil cargos from Guyana in the first quarter compared to nine cargos in first-quarter 2023. Hess expects 13 oil cargos to be sold in second-quarter 2024.

Yellowtail, the fourth Stabroek development, was sanctioned in April 2022 with a production capacity of 250,000 gross bbl/d. Initial production is expected in 2025.

Uaru, the fifth Stabroek development, was sanctioned in April 2023 with a production capacity of 250,000 gross bbl/d. Initial production is expected in 2026.

Whiptail, the sixth Stabroek development, was sanctioned in April 2024 and is expected to add production of 250,000 gross bbl/d by year-end 2027.

Spring, Texas-based Exxon Mobil now expects its six offshore Guyana projects to generate gross production of 1.3 MMbbl/d by 2027 compared to an earlier production estimate of more than 1.2 MMbbl/d.


Exxon Ups Mammoth Offshore Guyana Production by Another 100,000 bbl/d

On the ongoing exploration front offshore Guyana, Hess said the Bluefin-1 well found 197 ft of high-quality hydrocarbon-bearing sandstone reservoirs. The well was drilled in 4,244 ft of water and is located 5 miles southeast of the Sailfin-1 discovery.

Hess runs four rigs in Bakken

Hess said net production from the Bakken averaged 190,000 boe/d in first-quarter 2024, compared to 163,000 boe/d in first-quarter 2023. Higher volumes primarily reflected increased drilling and completion activity as well as higher NGL and natural gas volumes received under percentage of proceeds contracts due to lower commodity prices.


Hess’ Bakken Production Nearing Peak of 200,000 boe/d

During the first quarter, Hess operated four rigs and drilled 31 wells, completed 21 and brought 34 new wells online. The New York-based company plans to continue operating four drilling rigs in 2024.

Offshore U.S. and Asia

Hess also saw net GoM production average 31,000 boe/d in the first quarter, compared to 33,000 boe/d in first-quarter 2023.

And, offshore Southeast Asia, Hess said net production at North Malay Basin and JDA averaged 65,000 boe/d in first-quarter 2024, compared to 66,000 boe/d in first-quarter 2023.