Hess Corp. announced Thursday that it would spend $6.8 billion in global capital expenditures (capex) in 2012, including a large portion on drilling in the deepwater Gulf of Mexico (GOM).

The New York City-based major said it would spend $1.6 billion on production, including drilling production and water injection wells at the Shenzi field and production wells in the Llano field, both in the deepwater GOM.

Hess has a 50% interest in the Llano, an oil and gas field 150 miles off the Louisiana coast. Royal Dutch Shell plc (27.5%) and ExxonMobil Corp. (22.5%) also have stakes in the field, where Shell serves as operator. Meanwhile, Hess has a 28% stake in the Shenzi oil and gas field, located 125 miles off Louisiana’s coast. Australia’s BHP Billiton (44%) and Spain’s Repsol YPF SA (28%) hold stakes in Shenzi, which BHP operates.

The company also plans to spend $1.8 billion for development drilling in the Tubular Bells field, which is about 135 miles southeast of New Orleans, which it operates with a 57% stake (see Daily GPI, Oct. 26, 2011). Chevron Corp. (30%) is also invested in the Tubular Bells, which was discovered in 2003. Additional production, development and exploration funds would be spent in Equatorial Guinea, Norway, western Australia, Ghana, Indonesia, Brunei, Iraqi Kurdistan and in the Gulf of Thailand.

In the U.S. onshore, Hess is setting aside more than one-third of its capex this year — 37%, or $2.5 billion — to target unconventional sources in the United States, specifically the Bakken, Eagle Ford and Utica shales.

“We believe that the investments we are making in unconventionals are lower risk and will generate long term profitable growth for shareholders,” said Hess CEO John Hess. “We expect to fund the majority of our 2012 program from internally generated cash flow and asset sales.”

In the Bakken, the company said it will continue with the expansion of its gas processing facility in Tioga, ND and further develop the play, where it now operates 16 drilling rigs. Hess has the second-largest position in the Bakken (900,000 net acres), just behind Continental Resources (901,098 net acres). Hess also plans to drill appraisal wells in the Eagle Ford in Texas and Ohio’s Utica Shale.

Hess has been snapping up unconventional acreage for more than a year. Last September the company acquired almost 185,000 net acres in the Utica Shale and more than 18,000 undeveloped net acres in Louisiana’s Haynesville Shale after agreeing to buy Marquette Exploration LLC for $750 million. The company also agreed to pay Consol Energy Inc. $593 million to acquire a half interest in nearly 200,000 net acres in eastern Ohio. In December 2010 Hess paid $1.05 billion in cash to acquire 167,000 net acres in the Bakken from TRZ Energy LLC.

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