Hess Reports Second Quarter 2013 Earnings

Hess [HES] today reported net income of $1,431 million for the quarter ending June 30th 2013. Hess beats by $0.09, misses on revenue. 2nd quarter EPS of $1.51 beats by $0.09. Revenue of $4.11B misses by $0.95B

Hess says proceeds from $3.5B in asset sales made so far in 2013 have allowed it cut debts by $2.4B and add cash to its books. Will book $933M income from the $2.05B sale of Samara-Nafta to Lukoil made in April; without the sale, Q2 net income fell to $520M from $549M in the year-ago period.

The Russian divestment and other sales sent Q2 production falling to 341K boe from 429K boe a year ago, but output was within 340K-355K boe guidance.

Read the entire Hess earnings report

 
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Lukoil, Investors Buy $2.4 Billion of Company's Shares From ConocoPhillips

Lukoil, Russia’s largest oil producer not controlled by the state, together with a group of investors bought almost 5 percent of Lukoil’s shares from ConocoPhillips [COP] for $2.4 billion, the Moscow based company said.

Lukoil and the investor group bought 42.5 million shares in the form of American depositary receipts at a price of $56 each. The purchase, arranged by UniCredit Bank AG, was for less than half of an 11.6 percent holding that ConocoPhillips had made available under an option that expired yesterday, Lukoil said in an emailed statement.

The deal aims at enhancing the company’s attractiveness to investors. “It allows us to support our share prices, since the transaction is funded by the group’s internal resources, without increasing the company’s total debt,” Lukoil Vice President Leonid Fedun said in the statement today.....Read the entire article.

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Conoco's 2nd Quarter Profit Soars, Plans To Sell Entire Lukoil Stake

ConocoPhillips' (COP) second quarter earnings more than quadrupled on higher commodities prices and as its refining business returned to profitability, with results topping expectations. The company also reached an agreement to sell about 40% of its stake in Russian oil giant OAO Lukoil Holdings (LUKOY, LKOH.RS) and unveiled plans to sell all of it by the end of next year, instead of prior plans to just halve it. Conoco agreed to sell the initial part of its 20% stake in Lukoil for $3.44 billion. The deal is set to close in the current quarter. The rest will be sold to either Lukoil or on the open market.

Conoco, the third largest U.S. oil company by market value after Exxon Mobil Corp. (XOM) and Chevron Corp. (CVX), is in the midst of a major restructuring program that includes plans for $10 billion in divestitures in an effort to repay debt, a shift from a debt fueled acquisition spree when commodities prices were soaring. It reported a profit of $4.16 billion, or $2.77 a share, up from $900 million, or 57 cents a share, a year earlier. The latest quarter included a net $1.10 a share in gains. Analysts polled by Thomson Reuters forecast earnings of $1.56 a share. Conoco didn't provide revenue figures.

Exploration and production, which accounts for most of the company's profits, saw earnings soar on higher prices, though, as average daily oil and gas production fell 7.5% amid normal field declines and planned maintenance. Conoco's refining business profit also soared as margins strengthened and utilization rates improved. Refiners have benefited as demand for gasoline and diesel began to improve this year, though the sustainability is highly uncertain. Shares closed Tuesday at $54.44 and were inactive premarket. The stock is up 6.6% this year.

From the.....Dow Jones Newswire.

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Iraq Seals Deal with Russia's Lukoil-led Group

A consortium grouping Russia's private oil giant Lukoil and Norway's Statoil ASA on Sunday signed a final deal to develop one of Iraq's biggest oil fields, capping an auction process key to the OPEC nation's plans to boost output and generate sorely needed reconstruction revenues. The deal on West Qurna Phase 2 field in southern Iraq is the last of the 10 fields that Iraq awarded last year during two international licensing rounds as it looked to revamp an oil sector battered by years of sanctions, neglect and, most recently, postwar violence and political bickering.

The signing Sunday also offers some much needed political capital for Iraqi officials as they head into elections in March determined to show that they are actively turning the country around following the turmoil and instability that has defined Iraqis' daily lives since the 2003 U.S. led invasion to topple Saddam Hussein. "These contracts will bring in cash to Iraq, and move ahead plans to develop the infrastructure," said Oil Minister Hussain al-Shahristani, adding that these deals afforded Iraqis the chance to "look toward a bright future."

Although it sits atop the world's third largest proven reserves of conventional crude, Iraq currently only produces about 2.5 million barrels per day, a level still far below its pre-2003 war output. Officials say international companies like Lukoi and Statoil, which together won West Qurna Phase 2 in the December licensing round, are key to raising that output to over 12 million barrels per day in about six years.

Such production, viewed by analysts as unrealistic in that timeframe, would rival Saudi Arabia's. The kingdom, seen as the de facto leader of the Organization of the Petroleum Exporting Countries, currently produces over 8 million barrels per day, but has an overall output capacity in excess of 12 million barrels per day.

For the 15 international firms that won development rights in the various fields, the 20 year contracts were their first chance at access to Iraq since Saddam expelled foreign firms and nationalized the sector in the 1970s. Despite the tempting spoils, the auction results were mixed, with only 10 deals struck out of the 21 oil and gas fields offered during the two licensing rounds.....Read the entire article.

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ConocoPhillips Profit Drops 76% After Oil and Gas Plunge

ConocoPhillips, the third biggest U.S. oil company, said second quarter profit fell 76 percent after the recession spurred a collapse in energy prices. Net income dropped to $1.3 billion, or 87 cents a share, from $5.44 billion, or $3.50, a year earlier, Houston based ConocoPhillips said today in a statement. Excluding such one time items as a $192 million gain on the company’s Lukoil investment, profit was about 85 cents share, 1 cent higher than the average of 15 analyst estimates compiled by Bloomberg. U.S. oil futures plunged by more than half, averaging $59.79 a barrel, and gas prices fell 67 percent. ConocoPhillips is cutting its capital spending 37 percent this year and said in January that it would reduce its workforce by 4 percent.....Complete Story

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