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Hess (HES) Inks Deal to Divest Interests in South Arne Field

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Hess Corporation (HES - Free Report) recently announced an agreement with Ineos E&P AS. The company expects the transaction to be completed in the third quarter of 2021.

Per the accord, Hess will divest its affiliate Hess Denmark ApS for a total consideration of $150 million. Notably, through its affiliate, Hess has an ownership interest of 61.5% in the South Arne Field. In the December quarter of 2020, the global independent energy player‘s net production from the South Arne Field was recorded at 5,800 barrels of oil equivalent per day.

Hess intends to use the net proceeds from the sale for investment in world-class offshore resources in Guyana. As oil prices have recovered massively compared to the pandemic-driven lows last year, Hess’ decision to invest more in Guyana projects seems profitable. In fact, the oil pricing environment will continue to be favorable since coronavirus vaccines are being rolled out on a massive scale that will boost fuel demand since more people will go out for office and vacations.

Headquartered in New York, Hess currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include Diamondback Energy, Inc. (FANG - Free Report) , Matador Resources Company (MTDR - Free Report) and Pioneer Natural Resources Company (PXD - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Diamondback is likely to see earnings growth of 112.5% in 2021.

Matador is likely to see earnings growth of 300% in 2021.

Pioneer Natural is likely to see earnings growth of 429% in 2021.

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