Hess divests out of Equatorial Guinea with $650m sale

Hess corporation has announced a deal to sell its interests in offshore Equatorial Guinea assets to Kosmos Energy and Trident Energy for $650 million.

The move out of the West African country represents the Hess strategy to divest out of higher cost assets in favouring of focusing the portfolio on higher return assets.

During the first half of 2017 net production from the Equatorial Guinea averaged 28,000 barrels of oil per day.

The US oil producer holds an 85% and is operator, with Tullow Oil’s share of 15% in paying interest and the Republic of Equatorial Guinea a 5% carried interest.

“This sale is a further step in our strategy to focus our portfolio by investing in higher return assets and divesting more mature, higher cost assets,” said CEO John Hess.

“Proceeds from asset sales, along with cash on our balance sheet, are expected to fund the development of our truly world class investment opportunity offshore Guyana. Our investment in Guyana will position our company to deliver a decade of returns-driven growth and increasing cash generation to our shareholders.”

Hess expects the sale to close before the end of 2017.