Hess focusing on U.S. shale for 2013

Jan. 10, 2013 at 10:08 AM
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NEW YORK, Jan. 10 (UPI) -- Oil and natural gas company Hess Corp. announced it was spending 40 percent of its 2013 exploration budget on U.S. shale resources.

Hess said its capital and exploratory budget for 2013 was $6.8 billion, 18 percent less than designated last year. About 40 percent of that amount was dedicated to unconventional shale resource projects in the United States.

"Our expenditures in the Bakken (play) are planned to be $2.2 billion in 2013 versus approximately $3.1 billion in 2012," Greg Hill, president of worldwide exploration and production, said in a statement.

He said the reduced level of spending in the Bakken shale play in North Dakota was driven by lower well costs. Hess said it plans to operate 14 rigs in the Bakken play this year. Additional U.S. investments were designated for appraisal wells in the Utica shale play in Ohio.

Hess in September took on a 50 percent stake in 200,000 acres in the Utica shale deposit in eastern Ohio through the deal with Consol Energy Inc. Hess under the deal will operate 80,000 acres and Consol takes on the remaining acres in the play.

Shale development is controversial because the methods used to coax gas out of the rock formations are viewed as potentially harmful to groundwater supplies.

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