XML 23 R12.htm IDEA: XBRL DOCUMENT v3.8.0.1
Capitalized Exploratory Well Costs
9 Months Ended
Sep. 30, 2017
Capitalized Exploratory Well Costs [Abstract]  
Capitalized Exploratory Well Costs

5.  Capitalized Exploratory Well Costs

The following table discloses the net changes in capitalized exploratory well costs pending determination of proved reserves during the nine months ended September 30, 2017 (in millions):

 

Balance at January 1, 2017

 

$

597

 

Additions to capitalized exploratory well costs pending the determination of proved reserves

 

 

83

 

Reclassifications to wells, facilities and equipment based on the determination of proved reserves

 

 

(177

)

Balance at September 30, 2017

 

$

503

 

Reclassifications to wells, facilities and equipment based on the determination of proved reserves resulted primarily from sanction of the first phase of development for the Liza Field, offshore Guyana.  Capitalized exploratory well costs capitalized for greater than one year following completion of drilling were $404 million at September 30, 2017 and primarily related to:  

Ghana:  Approximately 65% of the capitalized well costs in excess of one year relates to our Deepwater Tano/Cape Three Points license (Hess 50%), offshore Ghana.  The government of Côte d’Ivoire had challenged the maritime border between it and the country of Ghana, which includes a portion of our Deepwater Tano/Cape Three Points license.  The International Tribunal for Law of the Sea rendered a final ruling on the maritime border dispute in September 2017 in favor of Ghana.  Under terms of our license, we now have ten months to submit a plan of development to the Ghanaian government.  We have declared commerciality for four discoveries, including the Pecan Field in March 2016, which would be the primary development hub for the block.  Front-end engineering studies and other development planning are progressing.

Gulf of Mexico: Approximately 25% of the capitalized well costs in excess of one year relates to an appraisal well in the northern portion of the Shenzi Field (Hess 28%) in the Gulf of Mexico, where hydrocarbons were encountered in the fourth quarter of 2015.  The operator is evaluating plans for developing this area of the field.

JDA:  Approximately 10% of the capitalized well costs in excess of one year relates to the JDA in the Gulf of Thailand (Hess 50%) where hydrocarbons were encountered in three successful exploration wells drilled in the western part of Block A-18.  We, along with our partner, are currently evaluating results and formulating future drilling plans in the area.