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Hess Concludes Sale of Norwegian Oil & Gas Assets for $2B

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Hess Corporation (HES - Free Report) has concluded the sale of its subsidiary — Hess Norge — to Aker BP ASA.

The sale, effective Jan 1, 2017, raised total proceeds of $2 billion. Hess Norge has interests in the Valhall and Hod fields in Norway.

Hess has been divesting its non-core assets to focus more on profitable projects which will benefit the company over the long run. The company plans to allocate the proceeds from this sale toward the offshore Guyana project, boost shareholder value and lower its debt.

Hess has made world-class oil discoveries at the Stabroek Block, located off the coast of Guyana. It estimates the gross recoverable resources from the block at 2.25-2.75 billion barrels of oil equivalent. The company expects the first production from offshore Guyana’s Liza prospects to come in by 2020.

About Hess Corporation

New York-based Hess is a global exploration and production company. It engages in exploration, development, production, transportation, purchase and sale of crude oil, natural gas liquids, and natural gas. Currently, the company has two operating segments — Exploration and Production (E&P), and Bakken Midstream.

The company’s E&P activities are concentrated in Denmark, Equatorial Guinea, the Joint Development Area of Malaysia/Thailand (JDA), Malaysia, Norway and the United States.

The Bakken Midstream operating segment provides fee-based services, including crude oil and natural gas gathering, processing of natural gas and the fractionation of natural gas liquids, transportation of crude oil by rail car, terminaling and loading crude oil and natural gas liquids, as well as the storage and terminaling of propane, mainly in the Bakken shale play of North Dakota.

Price Performance

Shares of Hess have gained 1.5% compared with the industry’s rally of 9.9% in the last three months.

Zacks Rank & Key Picks

Hess currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy sector include Holly Energy Partners, LP (HEP - Free Report) , SunCoke Energy Inc (SXC - Free Report) , and Northern Oil and Gas Inc (NOG - Free Report) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Holly Energy Partners, owner and operator of refined product pipelines and terminals, delivered an average positive earnings surprise of 57.14% over the trailing four quarters.

SunCoke Energy produces metallurgical coke in the United States. The company delivered an average positive earnings surprise of 113.52% in the last four quarters.

Northern Oil and Gas, based in Minnetonka, MN, is an independent energy company. The company delivered an average positive earnings surprise of 175.00% during the same time frame.

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