As Hess Corp. works to close a blockbuster sale to Chevron, Hess reported increased drilling activity and production in the Bakken during the fourth quarter.
Net production from the Bakken was 194,000 boe/d during the fourth quarter, Hess reported in earnings on Jan. 31.
That’s up 2% from average Bakken output of 190,000 boe/d during the third quarter of 2023—and up nearly 23% compared with 158,000 boe/d in the fourth quarter of 2022.
The year-over-year increase reflects increased drilling and completion activity in the Bakken and the effects of severe winter weather to close out 2022, Hess reported.
Fourth-quarter oil volumes from the Bakken averaged 89,000 bbl/d, up slightly from 87,000 bbl/d in the prior quarter and up 20% from 74,000 bbl/d in the year-ago period.
Hess operated four drilling rigs in the Bakken during the fourth quarter and the company plans to continue operating at a four-rig cadence in 2024.
In the fourth quarter, Hess drilled 33 new Bakken wells, completed 30 wells and brought 33 new wells online.
Company officials have repeatedly said Bakken production is expected to average 200,000 boe/d by 2025 before flatlining around that level for nearly a decade.
Those Bakken volumes should eventually lift Chevron Corp.’s total U.S. onshore production after the California-based major closes its $60 billion takeover of Hess Corp.
Chevron’s acquisition of Hess, announced last October, is expected to close in the first half of 2024.
Chevron boasts a sizable footprint in some of the Lower 48’s premier basins, including the Permian Basin and the Denver-Julesberg (D-J) Basin in the Rockies. But the Bakken will be a new area for Chevron.
As Chevron gets into the Bakken, it’s looking to get out of the Duvernay Shale play in Alberta.
Chevron announced plans earlier this month to market the company’s entire 70% working interest in its Duvernay Shale acreage—roughly 238,000 net acres, according to Houston-based Energy Advisors Group.
RELATED
Is Grayson Mill the Next Bakken Domino to Fall After Chevron-Hess?
Guyana glory
The Bakken gives Chevron some incremental production, but the Hess acquisition was mostly about buying exposure to Guyana—the world’s hottest offshore oil discovery.
Net production from Hess’ 30% interest in the Guyana Stabroek Block totaled 128,000 bbl/d during the fourth quarter.
In November, production commenced from the Prosperity FPSO project at Payara, which added 14,000 net bbl/d in the fourth quarter.
Hess participates in the 6.6 million-acre Stabroek Block with partners Exxon Mobil and CNOOC.
Hess also has a large offshore footprint in the Gulf of Mexico, where net production was 30,000 boe/d during the fourth quarter.
Recommended Reading
Venture Global Gets FERC Nod to Process Gas for LNG
2024-04-23 - Venture Global’s massive export terminal will change natural gas flows across the Gulf of Mexico but its Plaquemines LNG export terminal may still be years away from delivering LNG to long-term customers.
Watson: Implications of LNG Pause
2024-03-07 - Critical questions remain for LNG on the heels of the Biden administration's pause on LNG export permits to non-Free Trade Agreement countries.
US Asks Venture Global LNG to Justify Filing of Confidential Documents
2024-03-13 - The FERC request comes days after Venture Global LNG customers had challenged the company's request for a one-year extension of its startup and urged the regulator to make Venture Global release the confidential commissioning documents.
Despite LNG Permitting Risks, Cheniere Expansions Continue
2024-02-28 - U.S.-based Cheniere Energy expects the U.S. market, which exported 86 million tonnes per annum (mtpa) of LNG in 2023, will be the first to surpass the 200 mtpa mark—even taking into account a recent pause on approvals related to new U.S. LNG projects.
Venture Global Seeks FERC Actions on LNG Projects with Sense of Urgency
2024-02-21 - Venture Global files requests with the Federal Energy Regulatory Commission for Calcasieu Pass 1 and 2 before a potential vacancy on the commission brings approvals to a standstill.