Hess stands by U.S. shale

Jan. 31, 2013 at 10:22 AM
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NEW YORK, Jan. 31 (UPI) -- Hess Corp. won't pursue a sale of some of its assets in lucrative U.S. plays like Bakken shale despite calls from minority shareholders, CEO John Hess said.

Hess, Hess Corp.'s chief executive officer, said keeping assets in the Bakken and Utica shale plays in the United States was the right strategy for the company.

Global assets, he said, would "generate the cash needed to fund the unconventional growth we have in the Bakken and the Utica," he was quoted by Bloomberg News as saying.

This week, Hess said it was evolving into an exploration and production company as it leaves the refining business by closing a New Jersey facility. The company said the move could release around $1 billion for future growth opportunities.

Hess said it was setting aside about 40 percent of its $6.8 billion exploratory budget for the year on unconventional shale resource projects in the United States. Shale natural gas has put the country in a leadership position in terms of global reserves.

Investment company Elliott Management Corp., which owns 4 percent of Hess, said it was looking to shake up the board at Hess and called on the company to sell its shale business because of "years of lost shareholder value," reports Bloomberg.

Hess, in its fourth quarter report, recorded a profit of $566 million compared to a loss of $131 million reported for the same time last year.

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