Hess Corp.: Caught In Deep Water During The Storm
Hess Corporation: Spectacular Midstream Valuation
Tue, Jul. 12, 10:49 AM
- Southwestern Energy (SWN +8.4%) does not explicitly endorse new Obama administration regulations aimed at curbing the escape of methane gas from new wells and equipment, but it is among several prominent companies that agree that more methane controls are necessary, NY Times reports.
- SWN is helping to lead an industry group, One Future, which aims to reduce methane leakage to less than 1% of total U.S. gas production; other members of the group include Apache (APA +4.1%), BHP Billiton (BHP +3.1%), Hess (HES +4.1%) and Kinder Morgan (KMI +2.4%).
- SWN says the $14M it has spent on equipment, studies and other efforts to stem gas leaks has nearly paid for itself with the methane captured and sold.
- Others in the industry say new, more efficient extraction methods make additional oversight unnecessary and expensive, particularly given the sharp drop in natural gas prices in recent years.
Thu, Jun. 30, 3:25 PM
- Exxon Mobil (XOM +1.2%) and Hess (HES +3.5%) confirm a “world-class discovery” off the coast of Guyana that probably will yield 800M-1.4B boe of crude.
- The news confirms earlier comments by Guyana's natural resources minister, and the upper end of the new estimate is 2x larger than an earlier estimate that the field could contain 700M barrels of oil.
- The discovery is considered particularly significant for Hess; at the high end of the estimate, Hess' stake equates to 420M barrels, a 39% addition to its proved reserves; the company says more exploratory drilling is planned for the Stabroek block that hosts the Liza field.
- The companies could break even on developing the field at less than $40/bbl, Wells Fargo analysts estimate.
- XOM is operator of the Liza discovery and owns a 45% interest, while Hess holds a 30% stake and China's Cnooc (CEO +0.8%) owns the remaining 25%.
Mon, May 23, 5:37 PM
Tue, May 3, 2:36 PM
- Kosmos Energy (KOS -6.1%) and Chevron (CVX -1.7%) announce a farm-out agreement to sell a one-third ownership interest in the offshore Block 42 contract area near Suriname to Hess (HES -3.4%).
- Financial terms of the deal are not disclosed, but the three companies will own equal one-third stakes once the transaction closes.
- Hess will fully fund a 3-D seismic survey throughout the 6,500 sq. km exploration block as well as paying a disproportionate share of the drilling costs for the first exploration well in the area.
- Now read Hess downgraded at Credit Suisse on valuation
Wed, Apr. 27, 11:58 AM
- Hess (HES -3.4%) is sharply lower after posting a large but slightly lower than expected Q1 loss on a 36% Y/Y decline in revenues.
- HES says lower realized selling prices reduced Q1 after-tax results by ~$230M due to the the weak commodity price environment, although total costs and expenses declined 20% to $1.75B.
- HES says Q1 average selling prices for crude fell to $28.50/bbl from $45.08 in the prior-year quarter, and selling prices for natural gas liquids sank 50% to $7.44.
- Q1 production fell 1.4% Y/Y to 350K boe/day, as E&P capital spending declined 56% Y/Y to $554M from $1.24B; HES expects FY 2016 net production at 320K-325K boe/day, reflecting downtime at Valhall and several other deepwater Gulf of Mexico fields.
- HES says it plans a three-rig program in the Bakken during Q2 and the closing of one rig in Q3, and notes that it is waiting for $60/bbl oil before starting to put rigs back online.
- Now read Hess Corporation: Promising exploration tailwinds heading into earnings
Mon, Apr. 18, 2:47 PM
- Goldman Sachs expects energy investors will maintain a "buy the dip" mentality, and suggests focusing specifically on its Buy-rated shale productivity favorites such as Hess (HES +4.3%), EOG Resources (EOG +2.2%), Cenovus Energy (CVE +0.3%), PDC Energy (PDCE +4.3%) and Diamondback Energy (FANG +1.7%).
- Even after the Doha collapse, Goldman maintains its forecast for Q4 2016 WTI of $45/bbl and FY 2017 average of $58/bbl, as low near-term oil prices should ultimately enable mechanisms that will bring oil markets into better balance.
- Now read Goldman names nine favorites for Goldilocks ideal $35 oil
Thu, Apr. 7, 2:26 PM
- Goldman Sachs says crude oil at $35/bbl is the Goldilocks ideal - priced neither too high nor too low but just right - to make shares of U.S. explorers worth buying, suggesting investors and use volatility to add to positions of shale productivity winners.
- The $30-$35 range should keep behavior of U.S. oil producers unchanged and accommodate $55-$60 oil in 2017, Goldman says, providing opportunity for equities, while a near-term rally to $45-$50 oil would reduce 2017 upside but still be favorable for equities, at least temporarily.
- Goldman says it favors "secular productivity winners" EOG Resources (EOG -0.6%), Diamondback Energy (FANG +1.3%) and PDC Energy (PDCE -4.4%), as well as stocks in “the next rung down,” including Hess (HES -3.5%), Cenovus Energy (CVE -1.8%), Anadarko Petroleum (APC -1.1%), Encana (ECA -4%), Continental Resources (CLR -2.1%) and Whiting Petroleum (WLL -0.6%).
- Now read Oil, interest rates and game theory: Why prices have further to fall
Wed, Feb. 24, 7:29 PM
- Whiting Petroleum (NYSE:WLL) +7.4% AH despite missing estimates for Q4 earnings and revenues, as investors cheer the company's planned 80% reduction in 2016 capex to ~$500M, including a halt of all frack and completing wells as of April 1.
- WLL's capex cut is one of the largest so far this year and will have a major impact in North Dakota, where the company is the largest producer; rival producers Hess (NYSE:HES) and Continental Resources (NYSE:CLR) also cut their spending plans but not as drastically as WLL.
- WLL says most of its spending will go to mothball drilling and fracking operations in H1 at its core Bakken and Niobrara areas; after June, it plans to spend only $160M, mostly on maintenance.
- WLL says Q4 production rose ~18% Y/Y to 155,210 boe/day, and expects to pump 128K-138K boe/day for FY 2016.
Wed, Feb. 10, 9:17 AM
- Hess (NYSE:HES) +1.6% premarket after Goldman Sachs adds the stock to its Conviction Buy List with a $59 price target, upgrading it from a Neutral rating as it cites the company's liquidity, significant resource expansion opportunities, and strong position to benefit if oil prices rebound.
- "HES offers one of the most significant potential resource expansion opportunities among E&Ps over the next year from multiple exploration and appraisal drilling in Guyana and the Gulf of Mexico," Goldman says.
- Goldman removes Valero Energy (NYSE:VLO) from its Conviction Buy List but maintains its Buy rating.
Fri, Feb. 5, 9:59 AM
- Hess (HES -10.7%) plunges more than 10% at the open after pricing its concurrent public offerings of 25M common shares at $39 and its 10M depositary shares at $50.
- Hess says the net proceeds from the common stock offering and the depositary shares offering will total ~$945.8M and $485.3M, respectively; it plans to use the proceeds to strengthen its balance sheet and fund longer-term capital needs.
- David Faber tweets: "In 2014, Hess bought back 62.7M shares at avg. price of $83, after settling a proxy fight with Elliott Mgmt... Today $HES sold 25M at $39."
Fri, Feb. 5, 9:17 AM
Thu, Feb. 4, 4:35 PM
- Hess (NYSE:HES) -6.8% AH after announcing concurrent underwritten public offerings of 25M common shares and 10M depositary shares representing an interest in mandatory convertible preferred stock.
- HES grants the respective underwriters in each offering a 30-day option to purchase up to 3.75M additional common shares and up to 1.5M additional depositary shares.
- HES says it plans to use the proceeds to strengthen itss balance sheet and for general corporate purposes including funding its longer term capital needs and the cost of capped call transactions.
Wed, Jan. 27, 9:18 AM
- Hess (NYSE:HES) -2.3% premarket after reporting a narrower than expected Q4 loss on a 45% Y/Y drop in revenue to $1.39B, capping its first annual loss in 13 years.
- Hess says Q4 average selling prices for crude fell 42% Y/Y to $43.73/bbl, while selling prices for natural gas liquids plunged 57% to $9.61/bbl.
- Hess already announced plans to cut capital spending by 40% this year to $2.4B as it pulls back in all regions and pursues further cost reductions and efficiency gains.
- Hess expects 2016 oil and gas production of 330K-350K boe/day compared to FY 2015 net production of 368K boe/day, excluding Libya and asset sales; Q4 production totaled 358K boe/day, up 4% Y/Y.
- Total year-end proved reserves were 1.086B boe, down 24% from 1.431B boe a year earlier, as a result of lower crude prices and reduced drilling plans.
Thu, Jan. 21, 3:49 PM
- Crude oil futures settled more than 4% higher on the back of perceived oversold conditions, despite a higher than expected inventory build; March WTI jumped 4.2% to settle at $29.53/bbl after trading as high as $30.25, while Brent surged 4.9% to $29.25.
- Crude prices were supported by the inventory increase in this morning's EIA report, which was less than the API’s report released on Wednesday, says Phil Flynn, senior market analyst at Price Futures Group; also, reports of Libyan oil tanks on fire eased speculation that Libya would be exporting more oil soon.
- Also supportive for prices, oil production in the lower 48 states edged lower for the first time in seven weeks, “which is at least ‘less bearish’ for the extremely oversupplied global oil market,” says Tyler Richey of The 7:00’s Report.
- The energy sector is bouncing after hitting a multiyear low yesterday: XOM +1.4%, CVX +2.7%, RDS.A +3.8%, BP +3.7%, TOT +2.3%, STO +4.5%, COP +6.2%, MRO +12.2%, APC +10.3%, OXY +2.1%, EOG +6.4%, PXD +2.7%, APA +8.2%, HES +7%, KMI +15.5%, EPD +3.3%, ETP +6.8%.
- ETFs: UNG, USO, OIL, XLE, UGAZ, UCO, DGAZ, UWTI, VDE, ERX, OIH, SCO, XOP, BNO, BOIL, GAZ, DBO, DWTI, ERY, FCG, DIG, GASL, DTO, DUG, KOLD, BGR, USL, XES, IYE, IEO, UNL, IEZ, DNO, FENY, PXE, PXI, FIF, PXJ, OLO, SZO, NDP, RYE, DCNG, FXN, OLEM, DDG
Thu, Jan. 14, 3:26 PM
- Energy stocks are broadly higher as U.S. crude oil bounces off $30/bbl to end pit trading at $31.22, +2.6%; the SPDR Energy ETF (XLE +5.1%) soars 5%, with 36 of its 40 equity components trading higher, after closing yesterday at its lowest level since September 2010.
- Exxon Mobil (XOM +5.5%) and Chevron (CVX +5.9%) are the Dow's top two gainers; and pipeline companies sport strong showings with Kinder Morgan (KMI +8.2%), Plains All American Pipeline (PAA +11.7%) and Williams Cos. (WMB +27.4%) among the biggest winners.
- Among other major energy movers: ETE +22.6%, BP +7.6%, MRO +7.5%, OXY +7.1%, PBR +7%, COP +7%, RDS.A +6.7%, SE +6.1%, PSX +6.1%, ETP +6.1%, EPD +5.3%, APA +5%, E +4.6%, HES +4.1%, MPC +4.1%.
- Amid overwhelmingly negative sentiment, a few analysts are venturing out to say the worst may be over or nearly so: Deutsche Bank’s Torsten Slok thinks "we now have the worst behind us in terms of the negative impact of falling oil prices on the economy," and Gluskin Sheff’s David Rosenberg argues that the oil selloff is getting “long in the tooth.”
- ETFs: USO, OIL, XLE, UCO, UWTI, VDE, ERX, OIH, SCO, XOP, BNO, DBO, DWTI, ERY, FCG, DIG, GASL, DTO, DUG, BGR, USL, XES, IYE, IEO, IEZ, DNO, FENY, PXE, PXI, PXJ, FIF, OLO, SZO, NDP, RYE, FXN, OLEM, DDG
Tue, Jan. 5, 2:47 PM
- An eventual upturn in crude oil prices should turn the tide for the E&P sector In 2016, Citi analyst Robert Morris says as he upgrades Anadarko Petroleum (APC -1%), Canadian Natural Resources (CNQ +1%), EOG Resources (EOG +0.8%) and Cimarex Energy (XEC +1.4%) to Buy from Neutral and ups Oasis Petroleum (OAS -3.3%) to Neutral from Sell.
- For the first time in more than a decade, the per share debt-adjusted growth metrics within the E&P sector showed no correlation to the share price performance in 2015, according to Morris; without a further collapse in commodity prices, he sees debt-adjusted growth metrics, along with key debt metrics and the ability to increase production by spending within cash flow, driving relative E&P share performance.
- Morris maintains Buy ratings on Antero Resources (AR -2.4%), Apache (APA -2.3%), Concho Resources (CXO +1%), Memorial Resource Development (MRD -2%), Range Resources (RRC -0.4%) and Whiting Petroleum (WLL -7.1%), but downgrades Hess (HES -0.5%) to Neutral from Buy.
Hess Corp. engages develops, produces, purchases, transports and sells crude oil, natural gas liquids, and natural gas. The company was founded by Leon Hess in 1920 and is headquartered in New York, NY.
Sector: Basic Materials
Industry: Oil & Gas Refining & Marketing
Country: United States
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