* Production to start in 2014
* Drilling to start next year
* Hess shares drop 1.9 percent; Chevron falls 1 percent
Oct 25 Hess Corp said on Tuesday it
would spend $2.3 billion with Chevron Corp to develop
the Tubular Bells oil and gas field in the deepwater Gulf of
Annual output is expected to peak around 40,000 to 45,000
barrels of oil equivalent per day, with production expected to
begin in 2014. Drilling is expected to start next year, New
York-based Hess said.
Tubular Bells, located about 135 miles southeast of New
Orleans in the Mississippi Canyon area, was discovered in 2003
and is estimated to hold 120 million barrels of recoverable oil
Hess' plan initially calls for three subsea production
wells and two water injections wells from two drilling
locations that will be tied back to a production facility
operated by oil and gas infrastructure company Williams
The floating production facility, which a capacity of
60,000 barrels oil per day, is expected to be delivered to Hess
and Chevron in 30 months, Williams said.
After regulatory approval to assign BP Plc's
interest in the field to Hess, Hess will hold 57.14 percent
interest in the field, while Chevron's interest will be 42.86
Hess is slated to report third-quarter earnings on
Amid broad market declines, shares of Hess fell 3.6 percent
to $58.78, while Chevron was down 1.7 percent at $104.50.
Williams shares fell less than 1 percent to $56.89.