Hess Corporation reported unaudited consolidated earnings and operating results for the fourth quarter and full year ended December 31, 2012. For the quarter, the company reported sales (excluding excise taxes) and other operating revenue was $9,511 million compared to $9,733 million a year ago. Income before income taxes was $997 million compared to loss before income taxes of $198 million a year ago. Net income attributable to company was $566 million compared to loss of $131 million a year ago. Net cash provided by operating activities was $1,570 million compared to $1,138 million a year ago. Total capital and exploratory expenditures was $1,914 million compared to $2,236 million a year ago.

For the year, the company reported sales (excluding excise taxes) and other operating revenue was $37,691 million compared to $38,466 million a year ago. Income before income taxes was $4,053 million compared to loss before income taxes of $2,461 million a year ago. Net income attributable to company was $2,217 million compared to loss of $1,703 million a year ago. Net cash provided by operating activities was $5,660 million compared to $4,984 million a year ago. Total capital and exploratory expenditures was $8,265 million compared to $7,462 million a year ago.

For the quarter, the company announced oil and gas production of 396,000 barrels of oil equivalent per day, up from 367,000 barrels of oil equivalent per day in the fourth quarter a year ago, primarily reflecting an increase in production from the Bakken oil shale play and the resumption of operations in Libya, partly offset by the shut-in of the Valhall Field in Norway for the quarter due to the redevelopment project.

For the year, the company announced year-end total proved reserves were 1,553 million barrels of oil equivalent and reserve replacement for 2012 was 141%. During 2012, the corporation added 214 million barrels of oil equivalent to proved reserves and sold 83 million barrels of oil equivalent of proved reserves through asset dispositions. For the year, the company announced oil and gas production of 406,000 barrels of oil equivalent per day, up from 370,000 barrels of oil equivalent per day in the fourth quarter a year ago. In 2012, the company drilled 176 Hess-operated wells and completed 206. The average 30-day initial production rate for the wells the company completed was 750 to 900 barrels of oil per day.

The company reported asset impairment charge of $16 million for the fourth quarter of 2012.

The company provided earnings and operating guidance for the fiscal 2013 and earnings guidance for the fiscal 2014. The company announced 2013 budget also includes a 30% drop in exploratory spend to $550 million, consistent with strategy of pursuing a smaller, more focused exploratory program. For full year 2013 unit cost, E&P cash operating costs are expected to be in the range of $21 to $22 per barrel of oil equivalent produced. Depreciation, depletion and amortization expenses are expected to be in the range of $19 to $20 per barrel for total production unit cost of $40 to $42. For the full year of 2013, the company expects E&P effective tax rate to be in the range of 46% to 50% and expects 2013 after-tax interest expense to be in the range of $255 million to $265 million. For 2013, the company recently announced an 18% decrease in capital spending to $6.8 billion. This reduced level of spend is driven by lower well costs associated with transition to pad drilling and decreased investments in infrastructure projects. In 2013, the company plans to drill 185 Hess-operated wells and complete 175, of which, approximately 2/3 will target the Middle Bakken, and the remainder will target the Three Forks. The company expects production in 2013 to average between 375,000 and 390,000 barrels of oil equivalent per day. This forecast assumes that the sale of Samara-Nafta, which produces approximately 50,000 barrels of oil equivalent per day, closes at the end of the year. However, excluding the contribution from assets planned for divestiture this year, new base production level is expected to be in the range of 325,000 to 340,000 barrels of oil equivalent per day. However, excluding the contribution from assets planned for divestiture this year, new base production level is expected to be in the range of 325,000 to 340,000 barrels of oil equivalent per day. The company expects 2013 net production to average between 64,000 and 70,000 barrels of oil equivalent per day and for most of the growth to occur in the second half of the year.

For 2014, the company continues to believe that at current prices, capital expenditures should more closely approach operating cash flow.

The company announced the Tioga Gas Plant expansion project is targeted to be commissioned late in the fourth quarter of 2013.