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Hess & ExxonMobil's Liza Destiny Moves to Offshore Guyana

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Hess Corporation (HES - Free Report) recently announced the arrival of Liza Destiny — an oil production vessel — at the Stabroek Block, offshore Guyana. Notably, this is Guyana’s first floating, production, storage and offloading vessel.

The 1,115-foot vessel arrived at the site after a 42-day journey from Singapore. Starting as early as first-quarter 2020, it is expected to lead production from 17 wells during the first stage of development in Liza Phase 1. Output from this development is expected to reach up to 120,000 barrels of oil per day. Markedly, this May, operator Exxon Mobil Corporation (XOM - Free Report) authorized the $6-billion Liza Phase 2 project that is expected to commence within mid-2022. The third development, named Payara, is awaiting approvals.

ExxonMobil owns a 45% stake in the 6.6 million acres Stabroek block, with Hess holding a 30% interest. The remaining 25% stake at the block is owned by CNOOC Petroleum Guyana Limited, a subsidiary of CNOOC Limited (CEO - Free Report) .

In the last few months, the largest publicly-traded energy mammoth ExxonMobil and Hess have increased their reserve estimates off the coast of Guyana to almost 6 billion barrels of oil equivalent, following a series of major oil discoveries. Notably, ExxonMobil considers deepwater Guyana and the booming Permian Basin as major growth drivers. The company estimates 750,000 barrels of oil production per day, which is around 20% of its current global hydrocarbon output, offshore Guyana by 2025.

Price Performance

Hess has gained 53.7% in the past year against the 23.4% collective decline of the industry it belongs to.

Zacks Rank & Stock to Consider

Currently, Hess carries a Zacks Rank #3 (Hold). A better-ranked stock in the energy sector is given below:

Enbridge Inc. (ENB - Free Report) is a leader in energy transportation and distribution in North America, and internationally. The Zacks Rank #2 (Buy) company has not missed earnings estimates in the trailing four quarters. It delivered an average positive earnings surprise of 11.3% during this period. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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