Hess Corporation reported Thursday a net loss of $2,433 million, or $8.00 per common share, in the first quarter of 2020 even as oil production increased due in part to output from the Liza Phase 1 Development offshore Guyana.
“Our priorities in this low-price environment are to preserve cash, preserve capability and preserve the long-term value of our assets,” CEO John Hess said. “Our company is in a strong position to manage through this market downturn and to prosper when oil prices recover – with our low cost of supply and high return investments that will drive material cash flow growth and increasing financial returns.”
In Guyana, Hess said ExxonMobil, operator at the 6.6 million acres Stabroek block, has temporarily idled two of the four drilling rigs due to COVID-19-related travel restrictions. Hess said the Liza Destiny floating production, offloading, and storage vessel (FPSO) is expected to reach its full capacity of 120,000 gross barrels of oil per day (bopd) in June, with April gross production of approximately 75,000 bopd. Despite pandemic-related delays, the Liza Phase 2 development remains on schedule to start production in 2022.
Hess said Exploration and Production net loss was $2,371 million in the first quarter of 2020, compared with net income of $109 million in the first quarter of 2019. On an adjusted basis, E&P’s first quarter 2020 net loss was $120 million.
Net production, excluding Libya, was 344,000 boepd in the first quarter of 2020, up 24 percent from first quarter 2019 net production of 278,000 boepd.
“The improved performance primarily resulted from a 46 percent increase in Bakken production and the first full quarter of production at the Liza Field, offshore Guyana, which commenced production in December 2019,” the company stated.
Libya net production was 5,000 boepd in the first quarter of 2020 and 21,000 boepd in the first quarter of 2019, reflecting the Libyan National Oil Corporation’s declaration of force majeure in January 2020 due to civil unrest, Hess said.
The company’s net production from the Liza Field averaged 15,000 bopd in the first quarter of 2020.
Hess said its first one-million-barrel cargo of oil was sold in March 2020.