Energy Sector Update for 10/24/2017: HES,KOS,USEG,WFT

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Energy stocks displayed moderate gains on Tuesday, with the NYSE Energy Sector Index almost 0.3% higher while shares of energy companies in the S&P 500 also were up nearly 0.3% as a group. Crude oil for December delivery settled 57 cents higher at $52.47 per barrel while November natural gas futures fell 2 cents to $2.97 per 1 million BTU.

In company news, Hess Corp ( HES ) was lower in late Tuesday trading, reversing a more than 3% advance to a session high of $46.71 a share soon after today's opening bell that followed the energy company saying it was selling its oil and natural gas interests in Denmark and Equatorial Guinea for another $2.65 billion in combined gross proceeds.

In one transaction, Hess this morning said it will be selling its petroleum interests in Norway to Aker BP ASA for about $2 billion. It expects the deal to close during 2018.

Also, the company last night announced the $650 million sale of its interests in Equatorial Guinea - comprised of an 85% stake in the Ceiba and Okume offshore fields that are producing around 28,000 barrels of oil per day - to Kosmos Energy ( KOS ) and Trident Energy. That deal also followed Hess earlier Monday negotiating a $200 million tax settlement with the government of Equatorial Guinea.

Hess previously also sold its oil recovery business in the Permian Basin in Texas, boosting its total sales proceeds to around $3.25 billion. It plans to use around $500 million of those cash proceeds to pay down debt, and together with a cost reduction program aiming to trim spending by about $150 million per year, is expected to cut its production costs to less than $10 per barrel of oil equivalent by 2020.

In other sector news,

(+) USEG, Discloses plans to participate in an upcoming horizontal drilling program with CML Exploration targeting six wells in the Georgetown formation in southern Texas at a cost of about $3.4 mln per well.

(-) WFT, Last night completes exchange offer of $789.7 mln of its 9.875% senior notes due 2024 for an equal number of registered 9.875% senior notes due 2024.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Investing , Energy
Referenced Symbols: HES , KOS , USEG , WFT

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