Hess Corp. plans to spend $5.8 billion on capital expenditures (capex) in 2014, devoting $550 million to production and development projects in the deepwater Gulf of Mexico (GOM).

The New York-based company said it will spend $925 million on developments, including $400 million to develop and start up the Tubular Bells Field in the deepwater GOM (see Daily GPI, Jan. 27, 2012; Oct. 26, 2011). Hess said it will install the hull, topsides and subsea equipment for a platform at Tubular Bells, and will also complete two production wells and drill a fourth production well there.

Hess holds a 57% working interest (WI) in Tubular Bells, located about 135 miles southeast of New Orleans. Chevron Corp. (30% WI) also holds a stake in the field, which was discovered in 2003.

Hess also said it will spend $1.475 billion on production activities, including $150 million to drill two production wells and one water injection well in the Shenzi oil and gas field, located 125 miles from the coast of Louisiana. Hess has a 28% WI in the field, which it shares with Australia’s BHP Billiton (44% WI) and Spain’s Repsol YPF SA (28% WI). BHP serves as operator (see Daily GPI, Jan. 17, 2012).

“In 2010, we began focusing our portfolio around lower-risk, higher growth assets in regions where we have a distinct competitive advantage,” said CEO John Hess. “Our transformation accelerated rapidly in 2013 and we have successfully positioned Hess for long term growth, cash generation and strong, sustainable returns for our shareholders.

“We are committed to ensuring that our capital and exploratory budget enables our goal of achieving 5-8% compound average production growth through 2017 while generating the highest possible risk-adjusted returns.”

Earlier this month, Hess filed with the U.S. Securities and Exchange Commission to form Hess Retail Corp., a subsidiary for its convenience stores and gasoline fueling stations (see Daily GPI, Jan. 9). Hess plans to spin off the subsidiary and continue its transformation into a pure-play oil and gas exploration and production company.