Hess reports 17% dip in net income in Q423

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Hess Corporation recorded a decline in net income for the fourth quarter of 2023. The net income stood at US$413 million, or $1.34 per share, a 17% decrease from US$497 million, or $1.61 per share, in the fourth quarter of 2022. Adjusted net income for the fourth quarter of 2023 was US$501 million, or $1.63 per share, compared with US$522 million, or $1.69 per share, in the same period of the previous year.

The reduction in adjusted after-tax results from the prior year’s quarter was primarily due to lower realized gas and natural gas liquids (NGL) selling prices. This decrease was partially mitigated by higher production volumes in the fourth quarter of 2023. 

10-12 wells planned for Stabroek block next year to unlock more resource growth – Chevron CEO | OilNOW

In the Exploration & Production (E&P) segment, net income for the fourth quarter of 2023 was US$512 million, a decrease from US$641 million in the same quarter of 2022. On an adjusted basis, E&P net income was US$531 million for the fourth quarter of 2023, compared to US$565 million in the prior-year quarter. The average realized crude oil selling price, with hedging effects, was US$76.63 per barrel in the fourth quarter of 2023, slightly up from US$76.07 per barrel in the same quarter of 2022. However, the average realized NGL selling price dropped to US$20.92 per barrel from US$26.93 per barrel, and the average realized natural gas selling price decreased to US$4.51 per million cubic feet (mcf) from US$5.17 per mcf in the fourth quarter of 2022. 

Net production was up at 418,000 barrels of oil equivalent per day (boe/d), primarily due to increased production in the Bakken and Guyana, compared to 376,000 boe/d in the fourth quarter of 2022. Hess’ net barrels from the Bakken totaled 194,000 net boe/d. Guyana delivered 128,000 net b/d of oil production. The latter jurisdiction’s production notably increased in the quarter due to the start-up of production at the Payara project. The project reached its 220,000 b/d production target in January.

The Midstream segment reported a net income of US$63 million in the fourth quarter of 2023, marginally lower than the US$64 million in the same quarter of the previous year. In November 2023, Hess Midstream Operations LP (HESM Opco) repurchased approximately 3.4 million HESM Opco Class B units from Hess Corporation and Global Infrastructure Partners for US$100 million, with Hess Corporation receiving US$37.8 million. This transaction was financed through HESM Opco’s revolving credit facility, leaving Hess Corporation with a 37.8% ownership stake in HESM on a consolidated basis.

Chevron agreed to buy Hess Corporation last year for US$53 billion, with Hess’ 30% stake in Guyana’s Stabroek block being a key selling point. The acquisition is expected to be executed in the first quarter of 2024. Hess did not hold a Q4 earnings call.

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