UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): October 28, 2015
HESS CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
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DELAWARE |
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No. 1-1204 |
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No. 13-4921002 |
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(State or Other Jurisdiction of Incorporation) |
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(Commission File Number) |
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(IRS Employer Identification No.) |
1185 Avenue of the Americas
New York, New York 10036
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (212) 997-8500
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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£ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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£ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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£ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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£ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition.
On October 28, 2015, Hess Corporation issued a news release reporting estimated results for the third quarter of 2015. A copy of this news release is attached hereto as Exhibit 99(1) and is hereby incorporated by reference.
Item 9.01. Financial Statements and Exhibits.
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(d) |
Exhibit |
99(1)News release dated October 28, 2015 reporting estimated results for the third quarter of 2015.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Date: October 28, 2015 |
HESS CORPORATION |
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By: |
/s/John P. Rielly |
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Name: |
John P. Rielly |
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Title: |
Senior Vice President and |
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Chief Financial Officer |
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Exhibit No. |
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Description |
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99(1) |
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News release dated October 28, 2015 reporting estimated results for the third quarter of 2015. |
Exhibit 99.1
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HESS CORPORATION
HESS REPORTS ESTIMATED RESULTS FOR THE THIRD QUARTER OF 2015
Third Quarter Highlights:
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● |
Adjusted net loss was $291 million or $1.03 per share compared to net income of $377 million or $1.24 per share in the prior-year quarter; lower realized selling prices reduced third quarter 2015 adjusted net income by approximately $745 million, after-tax |
|
● |
Net loss was $279 million compared to net income of $1,008 million in the third quarter of 2014 |
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● |
Oil and gas production increased to 380,000 barrels of oil equivalent per day (boepd) compared to 318,000 boepd in the third quarter of 2014 |
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● |
Oil and gas production in the Bakken was 113,000 boepd, up from 86,000 boepd in the year-ago quarter |
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● |
Completed sale of 50% interest in Bakken Midstream, resulting in $3 billion of cash proceeds |
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● |
E&P capital and exploratory expenditures totaled $849 million in the third quarter, down from $1,371 million in the prior-year quarter |
Preliminary 2016 Guidance:
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● |
E&P capital and exploratory expenditures are expected to be $2.9 billion to $3.1 billion, down approximately 27 percent from 2015 forecasted E&P capital and exploratory expenditures of $4.1 billion |
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● |
Oil and gas production is forecast to be in the range of 330,000 to 350,000 boepd compared to projected production of 370,000 to 375,000 boepd in 2015, and 360,000 boepd in the fourth quarter of 2015 |
NEW YORK, October 28, 2015, — Hess Corporation (NYSE: HES) today reported an adjusted net loss, which excludes items affecting comparability, of $291 million or $1.03 per common share, for the
1
third quarter of 2015 compared with adjusted net income of $377 million or $1.24 per share in the third quarter of 2014. Lower realized selling prices reduced adjusted net income by approximately $745 million after-tax compared with the prior-year quarter. Third quarter 2015 results benefitted from higher production and lower cash operating costs but were partially offset by higher depreciation, depletion, and amortization expense. On an unadjusted basis, the Corporation reported a net loss of $279 million for the third quarter of 2015 and net income of $1,008 million in the prior-year quarter, which included after-tax gains from asset sales totaling $635 million.
“During the third quarter we delivered strong operating performance while maintaining a robust financial and liquidity position, with further significant spending reductions underway,” Chief Executive Officer John Hess said. “We are well positioned in the current low price environment and are taking a disciplined approach to preserve our financial strength, competitively advantaged capabilities and long term growth options.”
2
After-tax income (loss) by major operating activity was as follows:
|
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Three Months Ended |
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Nine Months Ended |
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||||||||||
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|
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September 30, |
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September 30, |
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||||||||||
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(unaudited) |
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(unaudited) |
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||||||||||
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2015 |
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2014 |
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2015 |
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2014 |
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||||
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(In millions, except per share amounts) |
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|||||||||||||
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Net Income (Loss) Attributable to Hess Corporation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration and Production |
|
$ |
(188 |
) |
|
$ |
433 |
|
|
$ |
(1,004 |
) |
|
$ |
2,003 |
|
|
Bakken Midstream |
|
|
16 |
|
|
|
8 |
|
|
|
75 |
|
|
|
2 |
|
|
Corporate, Interest and Other |
|
|
(94 |
) |
|
|
(82 |
) |
|
|
(266 |
) |
|
|
(308 |
) |
|
Net income (loss) from continuing operations |
|
|
(266 |
) |
|
|
359 |
|
|
|
(1,195 |
) |
|
|
1,697 |
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Discontinued operations |
|
|
(13 |
) |
|
|
649 |
|
|
|
(40 |
) |
|
|
628 |
|
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Net income (loss) attributable to Hess Corporation |
|
$ |
(279 |
) |
|
$ |
1,008 |
|
|
$ |
(1,235 |
) |
|
$ |
2,325 |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Net income (loss) per share (diluted) |
|
$ |
(0.98 |
) |
|
$ |
3.31 |
|
|
$ |
(4.35 |
) |
|
$ |
7.44 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Adjusted Net Income (Loss) Attributable to Hess Corporation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration and Production |
|
$ |
(221 |
) |
|
$ |
404 |
|
|
$ |
(538 |
) |
|
$ |
1,406 |
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|
Bakken Midstream |
|
|
16 |
|
|
|
8 |
|
|
|
75 |
|
|
|
2 |
|
|
Corporate, Interest and Other |
|
|
(86 |
) |
|
|
(80 |
) |
|
|
(254 |
) |
|
|
(237 |
) |
|
Adjusted net income (loss) from continuing operations |
|
|
(291 |
) |
|
|
332 |
|
|
|
(717 |
) |
|
|
1,171 |
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Discontinued operations |
|
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— |
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|
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45 |
|
|
|
— |
|
|
|
84 |
|
|
Adjusted net income (loss) attributable to Hess Corporation |
|
$ |
(291 |
) |
|
$ |
377 |
|
|
$ |
(717 |
) |
|
$ |
1,255 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Adjusted net income (loss) per share (diluted) |
|
$ |
(1.03 |
) |
|
$ |
1.24 |
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|
$ |
(2.53 |
) |
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$ |
4.01 |
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|
|
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|
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Weighted average number of shares (diluted) |
|
283.5 |
|
|
|
305.0 |
|
|
|
283.8 |
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|
|
312.7 |
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Exploration and Production:
The Exploration and Production adjusted net loss in the third quarter of 2015 was $221 million compared with adjusted net income of $404 million in the third quarter of 2014. On an unadjusted basis, Exploration and Production activities had a net loss of $188 million in the third quarter of 2015, compared with net income of $433 million in the third quarter of 2014.
The Corporation’s average worldwide crude oil selling price, including the effect of hedging, was down 53 percent to $45.66 per barrel in the third quarter of 2015 from $96.78 per barrel in the third quarter of 2014. The average worldwide natural gas liquids selling price was $7.17 per barrel, down
3
from $29.62 per barrel in the year-ago quarter while the average worldwide natural gas selling price was $4.02 per mcf in the third quarter of 2015 compared with $5.59 per mcf in the third quarter a year-ago.
Oil and gas production was 380,000 boepd, up 19 percent from 318,000 boepd in the third quarter of 2014. Assets contributing to the volume growth were the Bakken shale play (27,000 boepd), the Utica shale play (17,000 boepd), the Gulf of Mexico (13,000 boepd) and Norway (10,000 boepd). Due to continued strong performance during 2015, the Corporation is increasing its 2015 production guidance to 370,000 to 375,000 boepd, which is up from previous full year guidance of 360,000 to 370,000 boepd. For the fourth quarter of 2015, the Corporation forecasts production to be approximately 360,000 boepd with the Bakken projected to contribute between 100,000 boepd to 105,000 boepd.
Operational Highlights for the Third Quarter of 2015:
Bakken (Onshore U.S.): Net production from the Bakken increased approximately 31 percent to 113,000 boepd from the prior-year quarter due to continued drilling activities. The Corporation brought 48 gross operated wells on production in the third quarter of 2015 bringing the year-to-date total to 185 wells. Drilling and completion costs per operated well averaged $5.3 million in the third quarter of 2015, down 26 percent from the year-ago quarter. During the quarter, the Corporation operated 7 rigs.
Utica (Onshore U.S.): On the Corporation’s joint venture acreage, 5 wells were drilled and net production averaged 28,000 boepd in the third quarter of 2015 compared with 11,000 boepd in the prior-year quarter. The Corporation completed the sale of an additional 13,000 dry gas exploration acres for a sale price of approximately $120 million, including a note in the amount of $37 million.
Gulf of Mexico (Offshore U.S.): Net production from the Gulf of Mexico was 83,000 boepd compared to 70,000 boepd in the prior-year quarter, with higher volumes from Tubular Bells, which totaled 19,000 boepd in the third quarter of 2015, being primarily offset by lower production from the Llano Field. At the Hess-operated Stampede development project, drilling is expected to begin in early 2016.
Guyana (Offshore): On the Stabroek Block (Hess 30 percent), the operator announced a significant oil discovery at the Liza #1 well in the second quarter of 2015. The operator is currently in
4
the process of acquiring 17,000 square kilometers of 3D seismic and continues to evaluate the resource potential of the block.
Bakken Midstream:
The Corporation’s Bakken Midstream segment had net income of $16 million in the third quarter of 2015 compared to $8 million in the prior-year quarter primarily due to higher throughput. In July 2015, the Corporation completed the sale of a 50 percent interest in its Bakken Midstream for cash consideration of $2.7 billion. In connection with this transaction, in July 2015, the Bakken Midstream joint venture incurred $600 million of debt with proceeds distributed equally to both Hess and its partner, resulting in total after-tax cash proceeds net to Hess of approximately $3.0 billion. Following the completion of this sale, the Corporation continues to fully consolidate the operating results, assets and liabilities of the Bakken Midstream segment in its consolidated financial statements, with its partner’s share being reflected as a noncontrolling interest.
Capital and Exploratory Expenditures:
Exploration and Production capital and exploratory expenditures were $849 million in the third quarter of 2015 down from $1,371 million in the prior-year quarter driven by lower activities primarily in the United States (Bakken, Utica, and Tubular Bells), Norway and Equatorial Guinea, partly offset by continued development of the North Malay Basin project. Full year 2015 E&P capital and exploratory expenditures are forecast to be approximately $4.1 billion.
Bakken Midstream capital expenditures were $88 million in the third quarter of 2015 and $47 million in the year-ago quarter.
Liquidity:
Cash provided by operating activities before changes in working capital was $489 million in the third quarter of 2015, compared with $1,508 million in the third quarter of 2014. At September 30, 2015, cash and cash equivalents, excluding Bakken Midstream, were $3,004 million compared with $2,444 million at December 31, 2014. Total debt, excluding Bakken Midstream, was $5,952 million at September 30, 2015 compared with $5,987 million at December 31, 2014. The Corporation’s debt to capitalization ratio, excluding Bakken Midstream, at September 30, 2015 was 22.7 percent. The debt to capitalization ratio at December 31, 2014 was 21.2 percent.
5
The Corporation will finalize its 2016 budget by the end of this year. We currently project Exploration and Production 2016 capital and exploratory expenditures will be in a range of $2.9 billion to $3.1 billion, an approximate 27 percent decrease from the forecasted 2015 amount. As a result of the expected lower capital spend levels in 2016, we forecast production will decrease to a range of 330,000 boepd to 350,000 boepd. Bakken production is projected to be 95,000 boepd to 105,000 boepd in 2016. The Corporation expects to operate 4 rigs in the Bakken in 2016 compared to an average of 8.5 rigs in 2015.
Discontinued Operations:
Losses from discontinued operations, which primarily related to pension settlement charges, amounted to $13 million in the third quarter of 2015. Net income of $671 million in the prior-year quarter included an after-tax gain of $602 million resulting from the sale of the retail business. The Corporation completed the sale of its energy trading partnership (HETCO) in the first quarter of 2015. Financial results for the third quarter of 2014 have been recast to report HETCO as discontinued operations in the consolidated income statement on page 8.
Items Affecting Comparability of Earnings Between Periods:
The following table reflects the total after‑tax income (expense) of items affecting comparability of earnings between periods:
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|
Three Months Ended |
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|
Nine Months Ended |
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||||||||||
|
|
|
September 30, |
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|
September 30, |
|
||||||||||
|
|
|
(unaudited) |
|
|
(unaudited) |
|
||||||||||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|
2014 |
|
||||
|
|
|
(In millions) |
|
|||||||||||||
|
Exploration and Production |
|
$ |
33 |
|
|
$ |
29 |
|
|
$ |
(466 |
) |
|
$ |
597 |
|
|
Bakken Midstream |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Corporate, Interest and Other |
|
|
(8 |
) |
|
|
(2 |
) |
|
|
(12 |
) |
|
|
(71 |
) |
|
Discontinued operations |
|
|
(13 |
) |
|
|
604 |
|
|
|
(40 |
) |
|
|
544 |
|
|
Total items affecting comparability of earnings between periods |
|
$ |
12 |
|
|
$ |
631 |
|
|
$ |
(518 |
) |
|
$ |
1,070 |
|
Exploration and Production third quarter results include an after-tax gain of $31 million ($49 million pre-tax) from the sale of dry gas acreage in the Utica shale play and a tax benefit of $50 million associated with an international investment incentive. Exploration and Production results also include an after-tax charge of $26 million ($41 million pre-tax) for undeveloped leasehold impairment, $17 million ($27 million pre-tax) associated with exit costs in Kurdistan and other charges of $5 million
6
($6 million pre-tax). Corporate, Interest and Other third quarter results include an after-tax charge of $8 million ($10 million pre-tax) related to the Hovensa LLC bankruptcy.
Reconciliation of U.S. GAAP to Non-GAAP measures:
The following table reconciles reported net income (loss) attributable to Hess Corporation and adjusted net income (loss):
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
|
September 30, |
|
|
September 30, |
|
||||||||||
|
|
|
(unaudited) |
|
|
(unaudited) |
|
||||||||||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|
2014 |
|
||||
|
|
|
(In millions) |
|
|||||||||||||
|
Net income (loss) attributable to Hess Corporation |
|
$ |
(279 |
) |
|
$ |
1,008 |
|
|
$ |
(1,235 |
) |
|
$ |
2,325 |
|
|
Less: Total items affecting comparability of earnings between periods |
|
|
12 |
|
|
|
631 |
|
|
|
(518 |
) |
|
|
1,070 |
|
|
Adjusted net income (loss) attributable to Hess Corporation |
|
$ |
(291 |
) |
|
$ |
377 |
|
|
$ |
(717 |
) |
|
$ |
1,255 |
|
The reconciliations of net cash flow provided by operating activities before working capital changes to net cash provided by (used in) operating activities are detailed on pages 8 and 9.
Hess Corporation will review third quarter financial and operating results and other matters on a webcast at 10 a.m. today. For details about the event, refer to the Investor Relations section of our website at www.hess.com.
Hess Corporation is a leading global independent energy company engaged in the exploration and production of crude oil and natural gas. More information on Hess Corporation is available at www.hess.com.
Forward-looking Statements
Certain statements in this release may constitute "forward-looking statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Forward-looking statements are subject to known and unknown risks and uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, uncertainties inherent in the measurement and interpretation of geological, geophysical and other technical data. Estimates and projections contained in this release are based on the Company’s current understanding and assessment based on reasonable assumptions. Actual results may differ materially from these estimates and projections due to certain risk factors discussed in the Corporation’s periodic filings with the Securities and Exchange Commission and other factors.
Non-GAAP financial measure
The Corporation has used non-GAAP financial measures in this earnings release. “Adjusted net income (loss)” presented in this release is defined as reported net income (loss) attributable to Hess Corporation excluding items identified as affecting comparability of earnings between periods. “Cash provided by operating activities before working capital change” is defined as Cash provided by operating activities excluding changes in working capital. We believe that investors’ understanding of our performance is enhanced by disclosing these measures. These measures are not, and should not be viewed as, a substitute for U.S. GAAP net income (loss) or cash provided by operating activities. A reconciliation of reported net income (loss) attributable to Hess Corporation (U.S. GAAP) to adjusted net income (loss) as well as a reconciliation of cash provided by operating activities (U.S. GAAP) to cash provided by operating activities before working capital change are provided in the release.
For Hess Corporation
Investor Contact:Media Contact:
Jay WilsonMichael Henson/Patrick Scanlan
(212) 536-8940Sard Verbinnen & Co
(212) 687-8080
7
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
|
|
|
Third |
|
|
Third |
|
|
Second |
|
|||
|
|
|
Quarter |
|
|
Quarter |
|
|
Quarter |
|
|||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|||
|
Income Statement |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues and Non-operating Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and other operating revenues |
|
$ |
1,671 |
|
|
$ |
2,678 |
|
|
$ |
1,953 |
|
|
Gains on asset sales, net |
|
|
50 |
|
|
|
31 |
|
|
|
— |
|
|
Other, net |
|
|
(32 |
) |
|
|
27 |
|
|
|
(18 |
) |
|
Total revenues and non-operating income |
|
|
1,689 |
|
|
|
2,736 |
|
|
|
1,935 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold (excluding items shown separately below) |
|
|
356 |
|
|
|
423 |
|
|
|
356 |
|
|
Operating costs and expenses |
|
|
508 |
|
|
|
511 |
|
|
|
503 |
|
|
Production and severance taxes |
|
|
29 |
|
|
|
69 |
|
|
|
45 |
|
|
Exploration expenses, including dry holes and lease impairment |
|
|
144 |
|
|
|
90 |
|
|
|
90 |
|
|
General and administrative expenses |
|
|
119 |
|
|
|
139 |
|
|
|
151 |
|
|
Interest expense |
|
|
84 |
|
|
|
75 |
|
|
|
86 |
|
|
Depreciation, depletion and amortization |
|
|
988 |
|
|
|
838 |
|
|
|
1,028 |
|
|
Impairment |
|
|
— |
|
|
|
— |
|
|
|
385 |
|
|
Total costs and expenses |
|
|
2,228 |
|
|
|
2,145 |
|
|
|
2,644 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes |
|
|
(539 |
) |
|
|
591 |
|
|
|
(709 |
) |
|
Provision (benefit) for income taxes |
|
|
(300 |
) |
|
|
232 |
|
|
|
(156 |
) |
|
Income (loss) from continuing operations |
|
|
(239 |
) |
|
|
359 |
|
|
|
(553 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from discontinued operations, net of income taxes |
|
|
(13 |
) |
|
|
671 |
|
|
|
(14 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
(252 |
) |
|
|
1,030 |
|
|
|
(567 |
) |
|
Less: Net income (loss) attributable to noncontrolling interests |
|
|
27 |
|
|
|
22 |
|
|
|
— |
|
|
Net income (loss) attributable to Hess Corporation |
|
$ |
(279 |
) |
|
$ |
1,008 |
|
|
$ |
(567 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See "Discontinued Operations" on page 6 for basis of presentation. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flow Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities before working capital changes |
|
$ |
489 |
|
|
$ |
1,508 |
|
|
$ |
711 |
|
|
Changes in working capital |
|
|
(207 |
) |
|
|
(186 |
) |
|
|
(71 |
) |
|
Net cash provided by (used in) operating activities |
|
|
282 |
|
|
|
1,322 |
|
|
|
640 |
|
|
Net cash provided by (used in) investing activities |
|
|
(956 |
) |
|
|
1,585 |
|
|
|
(1,115 |
) |
|
Net cash provided by (used in) financing activities |
|
|
2,756 |
|
|
|
(992 |
) |
|
|
(100 |
) |
|
Net increase (decrease) in cash and cash equivalents |
|
$ |
2,082 |
|
|
$ |
1,915 |
|
|
$ |
(575 |
) |
8
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
|
|
|
Nine Months Ended |
|
|||||
|
|
|
2015 |
|
|
2014 |
|
||
|
Income Statement |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues and Non-operating Income |
|
|
|
|
|
|
|
|
|
Sales and other operating revenues |
|
$ |
5,162 |
|
|
$ |
8,180 |
|
|
Gains on asset sales, net |
|
|
50 |
|
|
|
820 |
|
|
Other, net |
|
|
(38 |
) |
|
|
(89 |
) |
|
Total revenues and non-operating income |
|
|
5,174 |
|
|
|
8,911 |
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
Cost of products sold (excluding items shown separately below) |
|
|
990 |
|
|
|
1,208 |
|
|
Operating costs and expenses |
|
|
1,517 |
|
|
|
1,551 |
|
|
Production and severance taxes |
|
|
110 |
|
|
|
209 |
|
|
Exploration expenses, including dry holes and lease impairment |
|
|
503 |
|
|
|
669 |
|
|
General and administrative expenses |
|
|
417 |
|
|
|
424 |
|
|
Interest expense |
|
|
255 |
|
|
|
241 |
|
|
Depreciation, depletion and amortization |
|
|
2,972 |
|
|
|
2,349 |
|
|
Impairment |
|
|
385 |
|
|
|
— |
|
|
Total costs and expenses |
|
|
7,149 |
|
|
|
6,651 |
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes |
|
|
(1,975 |
) |
|
|
2,260 |
|
|
Provision (benefit) for income taxes |
|
|
(807 |
) |
|
|
563 |
|
|
Income (loss) from continuing operations |
|
|
(1,168 |
) |
|
|
1,697 |
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from discontinued operations, net of income taxes |
|
|
(40 |
) |
|
|
684 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
(1,208 |
) |
|
|
2,381 |
|
|
Less: Net income (loss) attributable to noncontrolling interests |
|
|
27 |
|
|
|
56 |
|
|
Net income (loss) attributable to Hess Corporation |
|
$ |
(1,235 |
) |
|
$ |
2,325 |
|
|
|
|
|
|
|
|
|
|
|
|
See "Discontinued Operations" on page 6 for basis of presentation. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flow Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities before working capital changes |
|
$ |
1,670 |
|
|
$ |
4,228 |
|
|
Changes in working capital |
|
|
(312 |
) |
|
|
(845 |
) |
|
Net cash provided by (used in) operating activities |
|
|
1,358 |
|
|
|
3,383 |
|
|
Net cash provided by (used in) investing activities |
|
|
(3,297 |
) |
|
|
1,563 |
|
|
Net cash provided by (used in) financing activities |
|
|
2,508 |
|
|
|
(2,640 |
) |
|
Net increase (decrease) in cash and cash equivalents |
|
$ |
569 |
|
|
$ |
2,306 |
|
9
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
|
|
|
September 30, |
|
|
December 31, |
|
||
|
|
|
2015 |
|
|
2014 |
|
||
|
Balance Sheet Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
3,013 |
|
|
$ |
2,444 |
|
|
Other current assets |
|
|
2,584 |
|
|
|
4,243 |
|
|
Property, plant and equipment – net |
|
|
26,883 |
|
|
|
27,517 |
|
|
Other long-term assets |
|
|
3,976 |
|
|
|
4,374 |
|
|
Total assets |
|
$ |
36,456 |
|
|
$ |
38,578 |
|
|
|
|
|
|
|
|
|
|
|
|
Current maturities of long-term debt |
|
$ |
78 |
|
|
$ |
68 |
|
|
Other current liabilities |
|
|
2,546 |
|
|
|
4,783 |
|
|
Long-term debt |
|
|
6,474 |
|
|
|
5,919 |
|
|
Other long-term liabilities |
|
|
4,995 |
|
|
|
5,488 |
|
|
Total equity excluding other comprehensive income (loss) and noncontrolling interests |
|
|
22,913 |
|
|
|
23,615 |
|
|
Accumulated other comprehensive income (loss) |
|
|
(1,582 |
) |
|
|
(1,410 |
) |
|
Noncontrolling interests |
|
|
1,032 |
|
|
|
115 |
|
|
Total liabilities and equity |
|
$ |
36,456 |
|
|
$ |
38,578 |
|
|
|
|
September 30, 2015 |
|
|||||||||
|
|
|
Hess |
|
|
Bakken Midstream |
|
|
Hess Consolidated |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total debt |
|
$ |
5,952 |
|
|
$ |
600 |
|
|
$ |
6,552 |
|
10
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
|
|
|
Third |
|
|
Third |
|
|
Second |
|
|||
|
|
|
Quarter |
|
|
Quarter |
|
|
Quarter |
|
|||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|||
|
E&P Capital and Exploratory Expenditures |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bakken |
|
$ |
295 |
|
|
$ |
525 |
|
|
$ |
331 |
|
|
Other Onshore |
|
|
70 |
|
|
|
191 |
|
|
|
110 |
|
|
Total Onshore |
|
|
365 |
|
|
|
716 |
|
|
|
441 |
|
|
Offshore |
|
|
199 |
|
|
|
205 |
|
|
|
188 |
|
|
Total United States |
|
|
564 |
|
|
|
921 |
|
|
|
629 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
58 |
|
|
|
111 |
|
|
|
82 |
|
|
Africa |
|
|
13 |
|
|
|
125 |
|
|
|
58 |
|
|
Asia and other |
|
|
214 |
|
|
|
214 |
|
|
|
237 |
|
|
E&P Capital and Exploratory Expenditures |
|
$ |
849 |
|
|
$ |
1,371 |
|
|
$ |
1,006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total exploration expenses charged to income included above |
|
$ |
79 |
|
|
$ |
56 |
|
|
$ |
58 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bakken Midstream Capital Expenditures |
|
$ |
88 |
|
|
$ |
47 |
|
|
$ |
65 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended |
|
|||||
|
|
|
|
|
|
|
2015 |
|
|
2014 |
|
||
|
E&P Capital and Exploratory Expenditures |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bakken |
|
|
|
|
|
$ |
1,060 |
|
|
$ |
1,290 |
|
|
Other Onshore |
|
|
|
|
|
|
260 |
|
|
|
546 |
|
|
Total Onshore |
|
|
|
|
|
|
1,320 |
|
|
|
1,836 |
|
|
Offshore |
|
|
|
|
|
|
666 |
|
|
|
524 |
|
|
Total United States |
|
|
|
|
|
|
1,986 |
|
|
|
2,360 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
|
|
|
|
255 |
|
|
|
418 |
|
|
Africa |
|
|
|
|
|
|
159 |
|
|
|
344 |
|
|
Asia and other |
|
|
|
|
|
|
699 |
|
|
|
608 |
|
|
E&P Capital and Exploratory Expenditures |
|
|
|
|
|
$ |
3,099 |
|
|
$ |
3,730 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total exploration expenses charged to income included above |
|
|
|
|
|
$ |
184 |
|
|
$ |
188 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bakken Midstream Capital Expenditures |
|
|
|
|
|
$ |
193 |
|
|
$ |
168 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION EARNINGS (UNAUDITED)
(IN MILLIONS)
|
|
|
Third Quarter 2015 |
|
|||||||||
|
|
|
United States |
|
|
International |
|
|
Total |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and other operating revenues |
|
$ |
1,022 |
|
|
$ |
649 |
|
|
$ |
1,671 |
|
|
Gains on asset sales, net |
|
|
50 |
|
|
|
— |
|
|
|
50 |
|
|
Other, net |
|
|
(4 |
) |
|
|
(19 |
) |
|
|
(23 |
) |
|
Total revenues and non-operating income |
|
|
1,068 |
|
|
|
630 |
|
|
|
1,698 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold (excluding items shown separately below)(c) |
|
|
350 |
|
|
|
36 |
|
|
|
386 |
|
|
Operating costs and expenses |
|
|
193 |
|
|
|
250 |
|
|
|
443 |
|
|
Production and severance taxes |
|
|
28 |
|
|
|
1 |
|
|
|
29 |
|
|
Bakken Midstream tariffs |
|
|
117 |
|
|
|
— |
|
|
|
117 |
|
|
Exploration expenses, including dry holes and lease impairment |
|
|
87 |
|
|
|
57 |
|
|
|
144 |
|
|
General and administrative expenses |
|
|
47 |
|
|
|
13 |
|
|
|
60 |
|
|
Depreciation, depletion and amortization |
|
|
622 |
|
|
|
341 |
|
|
|
963 |
|
|
Total costs and expenses |
|
|
1,444 |
|
|
|
698 |
|
|
|
2,142 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations before income taxes |
|
|
(376 |
) |
|
|
(68 |
) |
|
|
(444 |
) |
|
Provision (benefit) for income taxes |
|
|
(129 |
) |
|
|
(127 |
) |
|
|
(256 |
) |
|
Net income (loss) attributable to Hess Corporation |
|
$ |
(247 |
) |
(a) |
$ |
59 |
|
(b) |
$ |
(188 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter 2014 |
|
|||||||||
|
|
|
United States |
|
|
International |
|
|
Total |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and other operating revenues |
|
$ |
1,629 |
|
|
$ |
1,049 |
|
|
$ |
2,678 |
|
|
Gains on asset sales, net |
|
|
2 |
|
|
|
35 |
|
|
|
37 |
|
|
Other, net |
|
|
(7 |
) |
|
|
28 |
|
|
|
21 |
|
|
Total revenues and non-operating income |
|
|
1,624 |
|
|
|
1,112 |
|
|
|
2,736 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold (excluding items shown separately below)(c) |
|
|
427 |
|
|
|
20 |
|
|
|
447 |
|
|
Operating costs and expenses |
|
|
185 |
|
|
|
272 |
|
|
|
457 |
|
|
Production and severance taxes |
|
|
62 |
|
|
|
7 |
|
|
|
69 |
|
|
Bakken Midstream tariffs |
|
|
65 |
|
|
|
— |
|
|
|
65 |
|
|
Exploration expenses, including dry holes and lease impairment |
|
|
34 |
|
|
|
56 |
|
|
|
90 |
|
|
General and administrative expenses |
|
|
63 |
|
|
|
19 |
|
|
|
82 |
|
|
Depreciation, depletion and amortization |
|
|
455 |
|
|
|
360 |
|
|
|
815 |
|
|
Total costs and expenses |
|
|
1,291 |
|
|
|
734 |
|
|
|
2,025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations before income taxes |
|
|
333 |
|
|
|
378 |
|
|
|
711 |
|
|
Provision (benefit) for income taxes |
|
|
125 |
|
|
|
153 |
|
|
|
278 |
|
|
Net income (loss) attributable to Hess Corporation |
|
$ |
208 |
|
(a) |
$ |
225 |
|
(b) |
$ |
433 |
|
|
(a) |
The after-tax realized results from crude oil hedging activities amounted to a gain of $13 million in the third quarter of 2015 and a gain of $4 million in the third quarter of 2014. Unrealized changes in crude oil hedging contracts which are included in Other operating revenues, amounted to a loss of $5 million in the third quarter of 2015 and gain of $5 million in the third quarter of 2014. |
|
(b) |
The after‑tax realized results from crude oil hedging activities amounted to a gain of $19 million in the third quarter of 2015 and a gain of $13 million in the third quarter of 2014. Unrealized changes in crude oil hedging contracts, which are included in Other operating revenues, amounted to a loss of $0.3 million in the third quarter of 2015 and amounted to a gain of $1 million in the third quarter of 2014. |
|
(c) |
Includes amounts from the Bakken Midstream. |
12
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION EARNINGS (UNAUDITED)
(IN MILLIONS)
|
|
|
Second Quarter 2015 |
|
|||||||||
|
|
|
United States |
|
|
International |
|
|
Total |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and other operating revenues |
|
$ |
1,259 |
|
|
$ |
694 |
|
|
$ |
1,953 |
|
|
Other, net |
|
|
(13 |
) |
|
|
(4 |
) |
|
|
(17 |
) |
|
Total revenues and non-operating income |
|
|
1,246 |
|
|
|
690 |
|
|
|
1,936 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold (excluding items shown separately below)(c) |
|
|
382 |
|
|
|
4 |
|
|
|
386 |
|
|
Operating costs and expenses |
|
|
181 |
|
|
|
254 |
|
|
|
435 |
|
|
Production and severance taxes |
|
|
44 |
|
|
|
1 |
|
|
|
45 |
|
|
Bakken Midstream tariffs |
|
|
116 |
|
|
|
— |
|
|
|
116 |
|
|
Exploration expenses, including dry holes and lease impairment |
|
|
48 |
|
|
|
42 |
|
|
|
90 |
|
|
General and administrative expenses |
|
|
79 |
|
|
|
18 |
|
|
|
97 |
|
|
Depreciation, depletion and amortization |
|
|
609 |
|
|
|
395 |
|
|
|
1,004 |
|
|
Goodwill impairment expense |
|
|
385 |
|
|
|
— |
|
|
|
385 |
|
|
Total costs and expenses |
|
|
1,844 |
|
|
|
714 |
|
|
|
2,558 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations before income taxes |
|
|
(598 |
) |
|
|
(24 |
) |
|
|
(622 |
) |
|
Provision (benefit) for income taxes |
|
|
(69 |
) |
|
|
(51 |
) |
|
|
(120 |
) |
|
Net income (loss) attributable to Hess Corporation |
|
$ |
(529 |
) |
(a) |
$ |
27 |
|
(b) |
$ |
(502 |
) |
|
(a) |
The after-tax realized results from crude oil hedging activities amounted to a loss of $1 million in the second quarter of 2015. Unrealized changes in crude oil hedging contracts, which are included in Other operating revenues, amounted to a gain of $3 million in the second quarter of 2015. |
|
(b) |
The after‑tax realized results from crude oil hedging activities amounted to a loss of $8 million in the second quarter of 2015. Unrealized changes in crude oil hedging contracts, which are included in Other operating revenues, amounted to a loss of $16 million after-tax. |
|
(c) |
Includes amounts from the Bakken Midstream. |
13
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION EARNINGS (UNAUDITED)
(IN MILLIONS)
|
|
|
Nine Months 2015 |
|
|||||||||
|
|
|
United States |
|
|
International |
|
|
Total |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and other operating revenues |
|
$ |
3,218 |
|
|
$ |
1,944 |
|
|
$ |
5,162 |
|
|
Gains on asset sales, net |
|
|
50 |
|
|
|
— |
|
|
|
50 |
|
|
Other, net |
|
|
(24 |
) |
|
|
(5 |
) |
|
|
(29 |
) |
|
Total revenues and non-operating income |
|
|
3,244 |
|
|
|
1,939 |
|
|
|
5,183 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold (excluding items shown separately below)(c) |
|
|
1,076 |
|
|
|
2 |
|
|
|
1,078 |
|
|
Operating costs and expenses |
|
|
587 |
|
|
|
734 |
|
|
|
1,321 |
|
|
Production and severance taxes |
|
|
106 |
|
|
|
4 |
|
|
|
110 |
|
|
Bakken Midstream tariffs |
|
|
335 |
|
|
|
— |
|
|
|
335 |
|
|
Exploration expenses, including dry holes and lease impairment |
|
|
171 |
|
|
|
332 |
|
|
|
503 |
|
|
General and administrative expenses |
|
|
202 |
|
|
|
41 |
|
|
|
243 |
|
|
Depreciation, depletion and amortization |
|
|
1,759 |
|
|
|
1,140 |
|
|
|
2,899 |
|
|
Goodwill impairment expense |
|
|
385 |
|
|
|
— |
|
|
|
385 |
|
|
Total costs and expenses |
|
|
4,621 |
|
|
|
2,253 |
|
|
|
6,874 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations before income taxes |
|
|
(1,377 |
) |
|
|
(314 |
) |
|
|
(1,691 |
) |
|
Provision (benefit) for income taxes |
|
|
(340 |
) |
|
|
(347 |
) |
|
|
(687 |
) |
|
Net income (loss) attributable to Hess Corporation |
|
$ |
(1,037 |
) |
(a) |
$ |
33 |
|
(b) |
$ |
(1,004 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months 2014 |
|
|||||||||
|
|
|
United States |
|
|
International |
|
|
Total |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and other operating revenues |
|
$ |
4,827 |
|
|
$ |
3,353 |
|
|
$ |
8,180 |
|
|
Gains on asset sales, net |
|
|
64 |
|
|
|
749 |
|
|
|
813 |
|
|
Other, net |
|
|
(21 |
) |
|
|
8 |
|
|
|
(13 |
) |
|
Total revenues and non-operating income |
|
|
4,870 |
|
|
|
4,110 |
|
|
|
8,980 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold (excluding items shown separately below)(c) |
|
|
1,253 |
|
|
|
31 |
|
|
|
1,284 |
|
|
Operating costs and expenses |
|
|
556 |
|
|
|
837 |
|
|
|
1,393 |
|
|
Production and severance taxes |
|
|
187 |
|
|
|
22 |
|
|
|
209 |
|
|
Bakken Midstream tariffs |
|
|
142 |
|
|
|
— |
|
|
|
142 |
|
|
Exploration expenses, including dry holes and lease impairment |
|
|
289 |
|
|
|
380 |
|
|
|
669 |
|
|
General and administrative expenses |
|
|
187 |
|
|
|
50 |
|
|
|
237 |
|
|
Depreciation, depletion and amortization |
|
|
1,219 |
|
|
|
1,070 |
|
|
|
2,289 |
|
|
Total costs and expenses |
|
|
3,833 |
|
|
|
2,390 |
|
|
|
6,223 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations before income taxes |
|
|
1,037 |
|
|
|
1,720 |
|
|
|
2,757 |
|
|
Provision for income taxes |
|
|
403 |
|
|
|
351 |
|
|
|
754 |
|
|
Net income (loss) attributable to Hess Corporation |
|
$ |
634 |
|
(a) |
$ |
1,369 |
|
(b) |
$ |
2,003 |
|
|
(a) |
The after-tax realized gains from crude oil hedging activities amounted to $12 million in the first nine months of 2015 and a gain of $2 million in the first nine months of 2014. Unrealized changes in crude oil hedging contracts, which are included in Other operating revenues, amounted to a loss of $2 million after-tax in the first nine months of 2015 and a gain of $3 million after-tax in the first nine months of 2014. |
|
(b) |
The after‑tax realized gain from crude oil hedging activities amounted to $12 million in the first nine months of 2015 and a gain of $13 million in the first nine months of 2014. Unrealized changes in crude oil hedging contracts, which are included in Other operating revenues, amounted to a loss of $6 million after-tax in the first nine months of 2015 and gain of $4 million after-tax in the first nine months of 2014. |
|
(c) |
Includes amounts from the Bakken Midstream. |
14
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)
|
|
|
Third |
|
|
Third |
|
|
Second |
|
|||
|
|
|
Quarter |
|
|
Quarter |
|
|
Quarter |
|
|||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|||
|
Operating Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Production Per Day (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Crude oil - barrels |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bakken |
|
|
82 |
|
|
|
63 |
|
|
|
85 |
|
|
Other Onshore |
|
|
10 |
|
|
|
11 |
|
|
|
11 |
|
|
Total Onshore |
|
|
92 |
|
|
|
74 |
|
|
|
96 |
|
|
Offshore |
|
|
60 |
|
|
|
51 |
|
|
|
61 |
|
|
Total United States |
|
|
152 |
|
|
|
125 |
|
|
|
157 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
40 |
|
|
|
31 |
|
|
|
39 |
|
|
Africa |
|
|
50 |
|
|
|
53 |
|
|
|
48 |
|
|
Asia |
|
|
2 |
|
|
|
2 |
|
|
|
2 |
|
|
Total |
|
|
244 |
|
|
|
211 |
|
|
|
246 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas liquids - barrels |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bakken |
|
|
20 |
|
|
|
15 |
|
|
|
22 |
|
|
Other Onshore |
|
|
12 |
|
|
|
8 |
|
|
|
12 |
|
|
Total Onshore |
|
|
32 |
|
|
|
23 |
|
|
|
34 |
|
|
Offshore |
|
|
7 |
|
|
|
6 |
|
|
|
6 |
|
|
Total United States |
|
|
39 |
|
|
|
29 |
|
|
|
40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
1 |
|
|
|
1 |
|
|
|
2 |
|
|
Total |
|
|
40 |
|
|
|
30 |
|
|
|
42 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas - mcf |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bakken |
|
|
65 |
|
|
|
46 |
|
|
|
71 |
|
|
Other Onshore |
|
|
125 |
|
|
|
52 |
|
|
|
95 |
|
|
Total Onshore |
|
|
190 |
|
|
|
98 |
|
|
|
166 |
|
|
Offshore |
|
|
93 |
|
|
|
76 |
|
|
|
98 |
|
|
Total United States |
|
|
283 |
|
|
|
174 |
|
|
|
264 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
45 |
|
|
|
29 |
|
|
|
41 |
|
|
Asia and other |
|
|
246 |
|
|
|
259 |
|
|
|
312 |
|
|
Total |
|
|
574 |
|
|
|
462 |
|
|
|
617 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barrels of oil equivalent |
|
|
380 |
|
|
|
318 |
|
|
|
391 |
|
15
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)
|
|
|
Nine Months |
|
|||||
|
|
|
2015 |
|
|
2014 |
|
||
|
Operating Data |
|
|
|
|
|
|
|
|
|
Net Production Per Day (in thousands) |
|
|
|
|
|
|
|
|
|
Crude oil - barrels |
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
Bakken |
|
|
82 |
|
|
|
61 |
|
|
Other Onshore |
|
|
11 |
|
|
|
10 |
|
|
Total Onshore |
|
|
93 |
|
|
|
71 |
|
|
Offshore |
|
|
57 |
|
|
|
52 |
|
|
Total United States |
|
|
150 |
|
|
|
123 |
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
38 |
|
|
|
35 |
|
|
Africa |
|
|
50 |
|
|
|
51 |
|
|
Asia |
|
|
2 |
|
|
|
3 |
|
|
Total |
|
|
240 |
|
|
|
212 |
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas liquids - barrels |
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
Bakken |
|
|
21 |
|
|
|
9 |
|
|
Other Onshore |
|
|
11 |
|
|
|
5 |
|
|
Total Onshore |
|
|
32 |
|
|
|
14 |
|
|
Offshore |
|
|
6 |
|
|
|
6 |
|
|
Total United States |
|
|
38 |
|
|
|
20 |
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
1 |
|
|
|
1 |
|
|
Total |
|
|
39 |
|
|
|
21 |
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas - mcf |
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
Bakken |
|
|
65 |
|
|
|
36 |
|
|
Other Onshore |
|
|
100 |
|
|
|
43 |
|
|
Total Onshore |
|
|
165 |
|
|
|
79 |
|
|
Offshore |
|
|
85 |
|
|
|
79 |
|
|
Total United States |
|
|
250 |
|
|
|
158 |
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
41 |
|
|
|
33 |
|
|
Asia and other |
|
|
297 |
|
|
|
316 |
|
|
Total |
|
|
588 |
|
|
|
507 |
|
|
|
|
|
|
|
|
|
|
|
|
Barrels of oil equivalent |
|
|
377 |
|
|
|
318 |
|
16
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)
|
|
|
Third |
|
|
Third |
|
|
Second |
|
|||
|
|
|
Quarter |
|
|
Quarter |
|
|
Quarter |
|
|||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|||
|
Sales Volumes Per Day (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Crude oil - barrels |
|
|
245 |
|
|
|
214 |
|
|
|
250 |
|
|
Natural gas liquids - barrels |
|
|
40 |
|
|
|
30 |
|
|
|
42 |
|
|
Natural gas - mcf |
|
|
574 |
|
|
|
462 |
|
|
|
617 |
|
|
Barrels of oil equivalent |
|
|
381 |
|
|
|
321 |
|
|
|
395 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales Volumes (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Crude oil - barrels |
|
|
22,592 |
|
|
|
19,719 |
|
|
|
22,729 |
|
|
Natural gas liquids - barrels |
|
|
3,701 |
|
|
|
2,772 |
|
|
|
3,848 |
|
|
Natural gas - mcf |
|
|
52,784 |
|
|
|
42,511 |
|
|
|
56,179 |
|
|
Barrels of oil equivalent |
|
|
35,090 |
|
|
|
29,576 |
|
|
|
35,940 |
|
|
|
|
Nine Months |
|
|||||
|
|
|
2015 |
|
|
2014 |
|
||
|
Sales Volumes Per Day (in thousands) |
|
|
|
|
|
|
|
|
|
Crude oil - barrels |
|
|
238 |
|
|
|
211 |
|
|
Natural gas liquids - barrels |
|
|
39 |
|
|
|
21 |
|
|
Natural gas - mcf |
|
|
588 |
|
|
|
507 |
|
|
Barrels of oil equivalent |
|
|
375 |
|
|
|
317 |
|
|
|
|
|
|
|
|
|
|
|
|
Sales Volumes (in thousands) |
|
|
|
|
|
|
|
|
|
Crude oil - barrels |
|
|
65,028 |
|
|
|
57,662 |
|
|
Natural gas liquids - barrels |
|
|
10,668 |
|
|
|
5,836 |
|
|
Natural gas - mcf |
|
|
160,604 |
|
|
|
138,530 |
|
|
Barrels of oil equivalent |
|
|
102,463 |
|
|
|
86,586 |
|
17
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)
|
|
|
Third |
|
|
Third |
|
|
Second |
|
|||
|
|
|
Quarter |
|
|
Quarter |
|
|
Quarter |
|
|||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|||
|
Operating Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Selling Prices |
|
|
|
|
|
|
|
|
|
|
|
|
|
Crude oil - per barrel (including hedging) |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
40.43 |
|
|
$ |
87.29 |
|
|
$ |
50.33 |
|
|
Offshore |
|
|
42.70 |
|
|
|
97.50 |
|
|
|
57.82 |
|
|
Total United States |
|
|
41.33 |
|
|
|
91.47 |
|
|
|
53.25 |
|
|
Europe |
|
|
53.49 |
|
|
|
110.06 |
|
|
|
60.88 |
|
|
Africa |
|
|
51.98 |
|
|
|
101.21 |
|
|
|
59.70 |
|
|
Asia |
|
|
— |
|
|
|
— |
|
|
|
59.37 |
|
|
Worldwide |
|
|
45.66 |
|
|
|
96.78 |
|
|
|
55.83 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Crude oil - per barrel (excluding hedging) |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
37.91 |
|
|
$ |
87.29 |
|
|
$ |
50.54 |
|
|
Offshore |
|
|
42.70 |
|
|
|
96.25 |
|
|
|
57.82 |
|
|
Total United States |
|
|
39.81 |
|
|
|
90.95 |
|
|
|
53.38 |
|
|
Europe |
|
|
50.12 |
|
|
|
106.40 |
|
|
|
62.39 |
|
|
Africa |
|
|
48.60 |
|
|
|
99.21 |
|
|
|
61.00 |
|
|
Asia |
|
|
— |
|
|
|
— |
|
|
|
59.37 |
|
|
Worldwide |
|
|
43.43 |
|
|
|
95.41 |
|
|
|
56.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas liquids - per barrel |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
5.45 |
|
|
$ |
28.20 |
|
|
$ |
9.47 |
|
|
Offshore |
|
|
12.56 |
|
|
|
31.45 |
|
|
|
15.82 |
|
|
Total United States |
|
|
6.69 |
|
|
|
28.84 |
|
|
|
10.46 |
|
|
Europe |
|
|
21.44 |
|
|
|
49.37 |
|
|
|
27.53 |
|
|
Worldwide |
|
|
7.17 |
|
|
|
29.62 |
|
|
|
11.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas - per mcf |
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
1.70 |
|
|
$ |
2.25 |
|
|
$ |
1.81 |
|
|
Offshore |
|
|
2.37 |
|
|
|
3.64 |
|
|
|
2.13 |
|
|
Total United States |
|
|
1.92 |
|
|
|
2.85 |
|
|
|
1.93 |
|
|
Europe |
|
|
6.43 |
|
|
|
9.63 |
|
|
|
7.35 |
|
|
Asia and other |
|
|
5.98 |
|
|
|
6.97 |
|
|
|
6.27 |
|
|
Worldwide |
|
|
4.02 |
|
|
|
5.59 |
|
|
|
4.49 |
|
18
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)
|
|
|
Nine Months |
|
|||||
|
|
|
2015 |
|
|
2014 |
|
||
|
Operating Data |
|
|
|
|
|
|
|
|
|
Average Selling Prices |
|
|
|
|
|
|
|
|
|
Crude oil - per barrel (including hedging) |
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
43.38 |
|
|
$ |
90.14 |
|
|
Offshore |
|
|
48.75 |
|
|
|
99.11 |
|
|
Total United States |
|
|
45.43 |
|
|
|
93.92 |
|
|
Europe |
|
|
55.87 |
|
|
|
110.09 |
|
|
Africa |
|
|
54.99 |
|
|
|
105.68 |
|
|
Asia |
|
|
56.85 |
|
|
|
104.66 |
|
|
Worldwide |
|
|
49.14 |
|
|
|
99.53 |
|
|
|
|
|
|
|
|
|
|
|
|
Crude oil - per barrel (excluding hedging) |
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
42.61 |
|
|
$ |
90.14 |
|
|
Offshore |
|
|
48.75 |
|
|
|
98.92 |
|
|
Total United States |
|
|
44.95 |
|
|
|
93.84 |
|
|
Europe |
|
|
55.01 |
|
|
|
109.01 |
|
|
Africa |
|
|
54.26 |
|
|
|
104.86 |
|
|
Asia |
|
|
56.85 |
|
|
|
104.66 |
|
|
Worldwide |
|
|
48.55 |
|
|
|
99.11 |
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas liquids - per barrel |
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
9.47 |
|
|
$ |
33.62 |
|
|
Offshore |
|
|
14.60 |
|
|
|
32.63 |
|
|
Total United States |
|
|
10.32 |
|
|
|
33.31 |
|
|
Europe |
|
|
25.50 |
|
|
|
56.98 |
|
|
Worldwide |
|
|
10.84 |
|
|
|
34.76 |
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas - per mcf |
|
|
|
|
|
|
|
|
|
United States |
|
|
|
|
|
|
|
|
|
Onshore |
|
$ |
1.78 |
|
|
$ |
3.57 |
|
|
Offshore |
|
|
2.26 |
|
|
|
4.01 |
|
|
Total United States |
|
|
1.95 |
|
|
|
3.80 |
|
|
Europe |
|
|
7.18 |
|
|
|
10.60 |
|
|
Asia and other |
|
|
6.07 |
|
|
|
7.13 |
|
|
Worldwide |
|
|
4.40 |
|
|
|
6.32 |
|
The following is summary of the Corporation’s commodity hedging program:
|
|
|
Brent |
|
West Texas Intermediate |
|
Q4 2015 Hedging program: |
|
|
|
|
|
Daily production - barrels of oil per day (bopd) |
|
50,000 |
|
20,000 |
|
Ceiling price |
|
$80 |
|
$80 |
|
Floor price |
|
$60 |
|
$60 |
|
Program finishing date |
|
December 31, 2015 |
|
December 31, 2015 |
19
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
BAKKEN MIDSTREAM EARNINGS (UNAUDITED)
(IN MILLIONS)
|
|
|
Third |
|
|
Third |
|
|
Second |
|
|||
|
|
|
Quarter |
|
|
Quarter |
|
|
Quarter |
|
|||
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|||
|
Income Statement |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues and non-operating income |
|
$ |
148 |
|
|
$ |
89 |
|
|
$ |
145 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and expenses |
|
|
65 |
|
|
|
54 |
|
|
|
68 |
|
|
General and administrative expenses |
|
|
4 |
|
|
|
3 |
|
|
|
3 |
|
|
Depreciation, depletion and amortization |
|
|
22 |
|
|
|
19 |
|
|
|
22 |
|
|
Interest expense |
|
|
4 |
|
|
|
— |
|
|
|
1 |
|
|
Total costs and expenses |
|
|
95 |
|
|
|
76 |
|
|
|
94 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations before income taxes |
|
|
53 |
|
|
|
13 |
|
|
|
51 |
|
|
Provision (benefit) for income taxes |
|
|
10 |
|
|
|
5 |
|
|
|
19 |
|
|
Net Income |
|
|
43 |
|
|
|
8 |
|
|
|
32 |
|
|
Less: Net income attributable to noncontrolling interests* |
|
|
27 |
|
|
|
— |
|
|
|
— |
|
|
Net income (loss) attributable to Hess Corporation |
|
$ |
16 |
|
|
$ |
8 |
|
|
$ |
32 |
|
* - On July 1, 2015, the Corporation completed the sale of a 50 percent interest in its Bakken Midstream segment. Our partner’s 50 percent share of net income is presented as a noncontrolling interest charge in the Bakken Midstream income statements effective from the third quarter of 2015.
|
|
|
Third |
|
Third |
|
Second |
|
|
|
Quarter |
|
Quarter |
|
Quarter |
|
|
|
2015 |
|
2014 |
|
2015 |
|
Bakken Midstream - Operating Volumes (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Processing |
|
|
|
|
|
|
|
Tioga gas plant - mcf of natural gas per day |
|
210 |
|
139 |
|
202 |
|
|
|
|
|
|
|
|
|
Export |
|
|
|
|
|
|
|
Terminal throughput – bopd (a) |
|
72 |
|
62 |
|
82 |
|
Tioga rail terminal crude loading – bopd (b) |
|
47 |
|
39 |
|
51 |
|
Rail services – bopd (c ) |
|
45 |
|
34 |
|
44 |
|
|
|
|
|
|
|
|
|
Pipelines |
|
|
|
|
|
|
|
Oil gathering - bopd |
|
41 |
|
28 |
|
35 |
|
Gas gathering - mcf of natural gas per day |
|
226 |
|
167 |
|
227 |
(a) Volume of crude oil received at the Ramburg Truck Facility for transportation to the Tioga Rail Terminal or third party pipelines.
(b) Volume of crude oil loaded to Hess Midstream and third party rail cars at the Tioga Rail Terminal.
(c) Volume of crude oil transported by Hess Midstream rail cars from the Tioga Rail Terminal and third party terminals.
20
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
BAKKEN MIDSTREAM EARNINGS (UNAUDITED)
(IN MILLIONS)
|
|
|
Nine Months |
|
|||||
|
|
|
2015 |
|
|
2014 |
|
||
|
Income Statement |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues and non-operating income |
|
$ |
423 |
|
|
$ |
218 |
|
|
|
|
|
|
|
|
|
|
|
|
Costs and Expenses |
|
|
|
|
|
|
|
|
|
Operating costs and expenses |
|
|
196 |
|
|
|
158 |
|
|
General and administrative expenses |
|
|
9 |
|
|
|
7 |
|
|
Depreciation, depletion and amortization |
|
|
65 |
|
|
|
48 |
|
|
Interest expense |
|
|
6 |
|
|
|
1 |
|
|
Total costs and expenses |
|
|
276 |
|
|
|
214 |
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations before income taxes |
|
|
147 |
|
|
|
4 |
|
|
Provision (benefit) for income taxes |
|
|
45 |
|
|
|
2 |
|
|
Net Income |
|
|
102 |
|
|
|
2 |
|
|
Less: Net income attributable to noncontrolling interests* |
|
|
27 |
|
|
|
— |
|
|
Net income (loss) attributable to Hess Corporation |
|
$ |
75 |
|
|
$ |
2 |
|
* - On July 1, 2015, the Corporation completed the sale of a 50 percent interest in its Bakken Midstream segment. Our partner’s 50 percent share of net income is presented as a noncontrolling interest charge in the Bakken Midstream income statements effective from the third quarter of 2015.
|
|
|
Nine Months |
||
|
|
|
2015 |
|
2014 |
|
Bakken Midstream - Operating Volumes (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
Processing |
|
|
|
|
|
Tioga gas plant - mcf of natural gas per day |
|
197 |
|
89 |
|
|
|
|
|
|
|
Export |
|
|
|
|
|
Terminal throughput – bopd (a) |
|
78 |
|
57 |
|
Tioga rail terminal crude loading – bopd (b) |
|
49 |
|
37 |
|
Rail services – bopd (c ) |
|
43 |
|
35 |
|
|
|
|
|
|
|
Pipelines |
|
|
|
|
|
Oil gathering - bopd |
|
35 |
|
24 |
|
Gas gathering - mcf of natural gas per day |
|
219 |
|
113 |
(a) Volume of crude oil received at the Ramburg Truck Facility for transportation to the Tioga Rail Terminal or third party pipelines.
(b) Volume of crude oil loaded to Hess Midstream and third party rail cars at the Tioga Rail Terminal.
(c) Volume of crude oil transported by Hess Midstream rail cars from the Tioga Rail Terminal and third party terminals.
21