Hess cuts losses in fourth quarter 2018
U.S. oil company Hess reduced its net loss for the fourth quarter 2018 compared to the prior-year period on the back of exploration and production business and higher crude oil and gas prices.
Hess on Wednesday reported a net loss of $4 million in the fourth quarter of 2018, compared to a net loss of $2.68 billion in the fourth quarter of 2017.
On an adjusted basis, the company reported a net loss of $77 million in the fourth quarter of 2018, compared with an adjusted net loss of $304 million in the prior-year quarter.
According to Hess, the fourth quarter 2018 results benefited from higher U.S. crude oil production, reduced operating costs, and lower depreciation, depletion and amortization expense, compared with the prior-year quarter.
Hess’ revenues in the fourth quarter 2018 increased to $1.68 billion from $1.29 billion in the same period of 2017.
Chief Executive Officer, John Hess, said: “With our strong execution in 2018, our portfolio is well positioned to deliver approximately 20 percent compound annual cash flow growth and more than 10 percent compound annual production growth through 2025, with a portfolio breakeven of less than $40 per barrel Brent by 2025.”
Exploration and Production net loss was $5 million in the fourth quarter of 2018, compared to a net loss of $2.59 billion, or a net loss of $219 million on an adjusted basis, in the fourth quarter of 2017.
Prices up but production down
The company’s average realized crude oil selling price was $58.11 per barrel in the fourth quarter of 2018, versus $57.32 per barrel in the year-ago quarter. The average realized natural gas liquids selling price in the fourth quarter of 2018 was $21.19 per barrel, versus $22.78 per barrel in the prior-year quarter, while the average realized natural gas selling price was $4.82 per mcf, compared to $3.69 per mcf in the fourth quarter of 2017.
Net production, excluding Libya, was 267,000 boepd in the fourth quarter of 2018, down from 282,000 boepd in the prior-year quarter, which included 58,000 boepd from divested assets. Growth in 2018 production was driven by the Bakken and the Gulf of Mexico.
E&P capital and exploratory expenditures were $618 million in the fourth quarter of 2018, compared to $568 million in the prior-year quarter, reflecting increased drilling in the Bakken, greater development activity in Guyana, and higher exploration spend, partially offset by reduced development spend in the Gulf of Mexico and the impact of 2017 asset sales.