Hess Projects 2018 E&P Capex Of $2.1 Bln - Quick Facts

(RTTNews) - While reporting its fourth-quarter financial results today, Hess Corp. (HES) forecast fiscal 2018 exploration and production or E&P capital and exploratory expenditures to be $2.1 billion. E&P capital and exploratory expenditures for fiscal 2017 were $2.047 billion.

Hess also said it eliminated approximately 400 employee and contractor positions in January as part of a restructuring, in addition to direct headcount reductions as part of assets sales.

The company projects fiscal 2018 oil and gas production, excluding Libya and reflecting an estimated 15,000 boepd reduction due to the extended Enchilada platform shutdown, in a range of 245,000 to 255,000 boepd, compared to full year pro forma 2017 net production, excluding Libya and assets sold, of 242,000 boepd.

Hess said that as part of its portfolio reshaping, it has begun implementation of an organization restructuring and cost reduction effort targeting annual savings of $150 million.

In addition to direct headcount reductions as part of assets sales, the company eliminated approximately 400 employee and contractor positions in January, and expects to record employee severance of $40 to $50 million in the first quarter.

Since the end of 2014, the company has reduced total employee and contractor positions by approximately 50 percent.

In addition to the workforce reduction, Hess said it has identified further cost reductions in logistics, information technology, property, professional fees, and other operating costs resulting from our portfolio reshaping. The benefit from this $150 million annualized cost reduction will begin to be realized over the second half of 2018.