Property, Plant and Equipment

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

3. Property, Plant and Equipment

Capitalized Exploratory Well Costs:

The following table discloses the net changes in capitalized exploratory well costs pending determination of proved reserves during the six months ended June 30, 2023 (in millions):


Balance at January 1, 2023	$	886
Additions to capitalized exploratory well costs pending the determination of proved reserves	128
Reclassifications to wells, facilities and equipment based on the determination of proved reserves	(78)
Capitalized exploratory well costs charged to expense	(6)
Balance at June 30, 2023	$	930

In the first six months, additions to capitalized exploratory well costs pending determination of proved reserves primarily related to wells drilled on the Stabroek Block (Hess 30%), offshore Guyana, and the Pickerel-1 exploration well (Hess 100%) in the Gulf of Mexico on Mississippi Canyon Block 727. Reclassifications to wells, facilities and equipment based on the determination of proved reserves resulted from the sanction of the Uaru Field development project, the fifth sanctioned project on the Stabroek Block. At June 30, 2023, 32 exploration and appraisal wells on the Stabroek Block, with a total cost of $738 million, were capitalized pending determination of proved reserves. The preceding table excludes well costs of $87 million that were incurred and expensed during the first six months of 2023.

At June 30, 2023, exploratory well costs capitalized for greater than one year following completion of drilling of $653 million was comprised of the following:

Guyana: Approximately 85% of the capitalized well costs in excess of one year relate to successful exploration wells where hydrocarbons were encountered on the Stabroek Block. The operator also plans further appraisal drilling on the block and is conducting pre-development planning for additional phases of development.

U.S.: Approximately 8% of the capitalized well costs in excess of one year relate to the Huron-1 exploration well (Hess 40%) located on Green Canyon Block 69 in the Gulf of Mexico, where oil bearing reservoirs were encountered. Well results are being evaluated and planning for appraisal activities is underway.

Joint Development Area (JDA): Approximately 6% of the capitalized well costs in excess of one year relate to the JDA (Hess 50%) in the Gulf of Thailand, where hydrocarbons were encountered in three successful exploration wells drilled in the western part of Block A-18. The operator has submitted a development plan concept to the regulator to facilitate ongoing

commercial negotiations for an extension of the existing gas sales contract to include development of the western part of the block.

Malaysia: Approximately 1% of the capitalized well costs in excess of one year relate to the North Malay Basin (Hess 50%), offshore Peninsular Malaysia, where hydrocarbons were encountered in one successful exploration well. Pre-development studies are ongoing.