Hess to focus capex on shale plays

US producer Hess Corporation plans to increase spending by more than 15% in 2012 from last year as it focuses on unconventional resources in the booming shale sector.

Chief executive John Hess said the company was investing in unconventionals that were “lower risk and will generate long term profitable growth”, adding he expected most of the capital programme’s funding to come from cash and asset sales.

The player will also outlay $1.6 billion on production, including drilling fresh production wells at its partnered Shenzi and Llano deepwater fields in the Gulf of Mexico as well as new wells at its operated Block G in Equatorial Guinea.

Hess will spend $1.8 billion on development activities, including projects at the Tubular Bells Field in the deepwater Gulf of Mexico, the Norwegian Valhall Field, the WA-390-P area offshore Western Australia and Block A-18 in the Gulf of Thailand.

A further $800 million will be spent on conventional exploration, with drilling planned for Ghana, Indonesia, Brunei and the deepwater Gulf of Mexico, and seismic acquisition envisaged for the Dinarta and Shakrok blocks in Iraqi Kurdistan.

New York-based Hess Corporation is a global integrated energy company engaged in the exploration, production, purchase, transportation and sale of crude oil and natural gas, as well as the production and sale of refined petroleum products.

Published: 12 January 2012 15:13 GMT | Last updated: 12 January 2012 15:15 GMT