Hess Corporation’s (HES - Free Report) Southeast Asian offshore natural gas assets, estimated in the range of $4-$5 billion, have drawn bids from several firms.
Per sources, some of the interested parties include Thailand’s PTTEP PCL and Austrian energy group OMV AG. Hess’ assets, which are among the few long-term and large projects in the region, raised interest as financially strong firms like PTTEP are purchasing assets abroad. Meanwhile, OMV and Kuwait Foreign Petroleum Exploration Company have been looking for assets in Asia.
Hess has nine gas fields in North Malay Basin in offshore Malaysia and the Malaysia-Thailand Joint Development Area (JDA). These assets are in equal partnership with Petronas, which holds 50%. In 2012, a production-sharing contract was inked by Hess and Petronas and the contract is till 2029. These fields are estimated to hold more than 1.5 trillion cubic feet of natural gas and more than 20 million barrels of condensate. Hess has not yet determined whether to divest the assets, which came online in July 2017.
Since 2014, the company has not delivered profits and investors have increasingly put pressure on the company to monetize assets. The price crash two years ago dented many companies’ profitability. Despite these, many other firms have delivered profits. Hess posted a smaller-than-expected loss in April-June.
Huge offshore oil projects in South America and U.S. shale oil are being developed by Hess. In 2014, the company divested its Thai assets to PTTEP for $1 billion and also sold its Indonesian assets.
Per sources, several parties have carried out preliminary work on the assets and are waiting for Hess to initiate a sale process. Even PTTEP has hired a financial advisor for its interest in the assets. OMV and Kuwait Foreign Petroleum Exploration Company did not disclose any details.
In August, OMV received regulatory nod to purchase Royal Dutch Shell plc’s (RDS.A) exploration and production assets in New Zealand for $578 million. The acquisition was in line with the company’s strategy to develop Australasia into a core region.
Price Performance
Hess has outperformed the industry in the past year. The company’s shares have surged 65.3% compared with the industry's 43.8% rally.
Zacks Rank & Stocks to Consider
Hess currently carries a Zacks Rank #3 (Hold).
A few better-ranked players in the same sector are Petroleo Brasileiro S.A. (PBR - Free Report) , or Petrobras SA, Helix Energy Solutions Group, Inc (HLX - Free Report) and TC Pipelines, LP . All these stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Petrobras is the largest integrated energy firm in Brazil and one of the major players in Latin America. It pulled off an average positive earnings surprise of 10.4% in the last four quarters.
Helix Energy offers specialty services to the offshore energy industry. The company delivered an average positive earnings surprise of 66.7% in the trailing four quarters.
TC Pipelines purchases, owns and actively participates in the management of U.S.-based natural gas pipelines and related assets. The company delivered an average positive earnings surprise of 3.7% in the last four quarters.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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Hess Corporation’s (HES - Free Report) Southeast Asian offshore natural gas assets, estimated in the range of $4-$5 billion, have drawn bids from several firms.
Per sources, some of the interested parties include Thailand’s PTTEP PCL and Austrian energy group OMV AG. Hess’ assets, which are among the few long-term and large projects in the region, raised interest as financially strong firms like PTTEP are purchasing assets abroad. Meanwhile, OMV and Kuwait Foreign Petroleum Exploration Company have been looking for assets in Asia.
Hess has nine gas fields in North Malay Basin in offshore Malaysia and the Malaysia-Thailand Joint Development Area (JDA). These assets are in equal partnership with Petronas, which holds 50%. In 2012, a production-sharing contract was inked by Hess and Petronas and the contract is till 2029. These fields are estimated to hold more than 1.5 trillion cubic feet of natural gas and more than 20 million barrels of condensate. Hess has not yet determined whether to divest the assets, which came online in July 2017.
Since 2014, the company has not delivered profits and investors have increasingly put pressure on the company to monetize assets. The price crash two years ago dented many companies’ profitability. Despite these, many other firms have delivered profits. Hess posted a smaller-than-expected loss in April-June.
Huge offshore oil projects in South America and U.S. shale oil are being developed by Hess. In 2014, the company divested its Thai assets to PTTEP for $1 billion and also sold its Indonesian assets.
Per sources, several parties have carried out preliminary work on the assets and are waiting for Hess to initiate a sale process. Even PTTEP has hired a financial advisor for its interest in the assets. OMV and Kuwait Foreign Petroleum Exploration Company did not disclose any details.
In August, OMV received regulatory nod to purchase Royal Dutch Shell plc’s (RDS.A) exploration and production assets in New Zealand for $578 million. The acquisition was in line with the company’s strategy to develop Australasia into a core region.
Price Performance
Hess has outperformed the industry in the past year. The company’s shares have surged 65.3% compared with the industry's 43.8% rally.
Zacks Rank & Stocks to Consider
Hess currently carries a Zacks Rank #3 (Hold).
A few better-ranked players in the same sector are Petroleo Brasileiro S.A. (PBR - Free Report) , or Petrobras SA, Helix Energy Solutions Group, Inc (HLX - Free Report) and TC Pipelines, LP . All these stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Petrobras is the largest integrated energy firm in Brazil and one of the major players in Latin America. It pulled off an average positive earnings surprise of 10.4% in the last four quarters.
Helix Energy offers specialty services to the offshore energy industry. The company delivered an average positive earnings surprise of 66.7% in the trailing four quarters.
TC Pipelines purchases, owns and actively participates in the management of U.S.-based natural gas pipelines and related assets. The company delivered an average positive earnings surprise of 3.7% in the last four quarters.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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