Page 11 - NorthAmOil Week 04 2021

NorthAmOil PERFORMANCE NorthAmOil

Hess’ quarterly loss shrinks compared

with previous quarter and year on year

US US-BASED Hess has reported a net loss of While Hess’ overall production declined
$97mn, or $0.32 per share, in the fourth quarter year on year, its net output from the Bakken play
of 2020. This was up from a loss of $222mn, or in North Dakota rose to 189,000 boepd from
$0.73 per share, in the same quarter of 2019 and 174,000 boepd in the previous year’s quarter.
a loss of $243mn, or $0.80 per share, in the third Bakken oil production declined y/y, however, to
quarter of 2020. 97,000 barrels per day from 106,000 bpd a year
The improvement came as oil demand and ago. The company attributed this primarily to
prices strengthened, amid easing restrictions decreased drilling and completion activity as a
related to the coronavirus (COVID-19) pan- result of having reduced the number of operated
demic and the start of the roll-out of newly rigs from six to one in May 2020.
Hess provided an developed vaccines against the virus. West Texas Hess also reported that it had agreed to sell
update on the VLCCs it Intermediate (WTI) averaged just under $43 per the second and third cargoes that it has been
chartered to store crude barrel in the fourth quarter, and had risen above storing on very large crude carriers (VLCCs)
last year. $52 per barrel as of January 27. chartered to hold its Bakken crude output dur-
Hess’ net production, excluding Libya, ing the worst of last year’s downturn. Combined,
was 309,000 barrels of oil equivalent per day these two cargoes amount to 4.2mn barrels of
in the fourth quarter of 2020, compared with crude, which will be delivered during this quar-
316,000 boepd in the same quarter of 2019. The ter. The first VLCC cargo of 2.1mn barrels was
company noted that production from Libya – sold in September, with cash proceeds received
which had been disrupted by an ongoing civil in October.
war – resumed in the fourth quarter of 2020 Earlier this week, Hess announced an explo-
and averaged 12,000 boepd on a net basis, com- ration and production capital budget of $1.9bn
pared with 22,000 boepd in the fourth quarter for 2021, of which more than 80% will be allo-
of 2019. cated to Guyana and the Bakken.™

Panama Canal congestion

contributes to LNG price spike

AMERICAS CONGESTION in the Panama Canal delaying The authority told Reuters that it had changed
shipments of LNG from the US Gulf Coast to its transit reservation system on January 4 to ease
Asia is among the factors contributing to record- the bottleneck and allow LNG vessels to reserve
high spot prices for the super-chilled fuel in two slots 10-15 days ahead of transit, rather than
Northeast Asia. just one. It has also introduced auctions to sell
Other significant contributors include cold- off any slot that becomes available within 2-3
er-than-expected winter weather, a shortage days before transit owing to last-minute can-
of LNG carriers and supply outages at some cellations. On January 14, the authority said five
The LNG tankers using liquefaction plants around the world. The Pan- auctions had been conducted to date, and four
the Panama Canal are ama Canal congestion could last until March, slots awarded to LNG carriers.
carrying LNG from the according to traders cited by Reuters, and the A trip from the US to Asia via the Panama
US Gulf Coast. weather is anticipated to start improving around Canal, which connects the Atlantic and Pacific
then too. This has already led to LNG spot prices oceans, can take around 15 days according to
for March delivery trading at less than half the Reuters. The alternative is to sail around the Cape
average price of cargoes due to be delivered in of Good Hope in South Africa, but that route
February. more than doubles journey time to around 38
The congestion comes despite the canal’s days. Given the higher costs of longer journeys,
regulator, the Panama Canal Authority, saying LNG vessels would be expected to avoid this
it had made changes designed to speed up tran- option. However, Energy Aspects has estimated
sit through the waterway. Reuters reported that that around one third of LNG carriers loading
LNG carriers had to wait for up to two weeks to from the US took the long route in December,
transit the canal in December, but that the wait illustrating how strong Asian demand for LNG
had now halved to one week. had become.™

Week 04 28•January•2021 www. NEWSBASE .com P11