Hess Corporation has entered into an agreement to sell its joint venture interests in the Utica shale play in eastern Ohio to Ascent Resources – Utica, LLC for net cash consideration of approximately $400 million, effective April 1. 

“We continue to focus our portfolio by divesting lower return, non-core assets as part of our strategy to deliver long term value to shareholders,” CEO John Hess said. “Proceeds from this transaction will be used to invest in our higher return growth opportunities in Guyana and the Bakken and to fund the company’s previously announced share repurchase program.” 

The divestiture consists of approximately 39,000 net acres including 26,000 net undeveloped acres. For full year 2018, net production is forecast to average 14,000 barrels of oil equivalent per day, of which approximately 70 percent is expected to be residue gas. Hess holds a 50 percent working interest as part of a joint venture with CNX Resources (NYSE: CNX). 

The agreement is subject to customary closing conditions and adjustments and is expected to close by the end of third quarter 2018. 

Denmark Sale Update 

Hess also announced that it has decided to retain its interests in Denmark, where the company holds a 61.5 percent interest in the South Arne Field and is the operator. The offers received in a previously announced sale process did not meet the company’s value expectations. In the normal course of business, the company will continue to look at strategic options for this asset.