License to Operate:
Socio-economic Impacts and
the Public-Industry Partnership
Mike Turner - Senior Vice President,
Global Production
Hess: Who We Are…
Hess Corporation is a leading global
independent energy company, engaged in the
exploration and production of crude oil and
natural gas, as well as in refining and
marketing refined petroleum products, natural
gas, and electricity:
•
Ranked No. 74 on the Fortune 100
•
More than $34 billion in revenue
•
14,000 employees globally
•
Operations in 22 countries
•
Member of the North Dakota community since
1950’s
Hess: Global Operations…
ENERGY ON THE MOVE
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Hess: Unconventional Strategy…
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Hess: Growing Unconventional Portfolio…
Bakken Shale
• >800,000 net acres
•16 rig program in 2012
Eagle Ford Shale
• >100,000 net acres
• ~20 wells in 2012
Utica Shale
• ~200,000 net acres
• ~22 wells in 2012
Paris Basin
• ~340,000 net acres
• Plan 3 conv. wells beginning 4Q12
China
• JSA’s with Sinopec & PetroChina
• ~2 MM gross acres
Canning Basin
• >2 MM net acres
• Aeromagnetic survey in 2012
Beetaloo Basin
• >6.2 MM gross acres
• Seismic underway
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Hess: An Established History in the Bakken…
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Hess: Bakken Operations…

Hess ~67 percent working
interest - operator

~900,000 net acres

5 frac crews

16 rig program

Expanding advantaged
infrastructure
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The Future Looks Bright
North Dakota is in an enviable position:
2011 Actual Expenditures $7.4 billion
At 3 percent the unemployment rate is the
lowest in the country compared to a
national average of 8 percent.
Of the 15 counties in America with the
lowest unemployment rates, 11 are in
North Dakota.
Hess paid royalties of more than $144
million to State and local residents in
2011 - a 300 percent increase on the $36
million paid in 2006.
State GDP grew 7.1 percent in 2010 almost three times the nationwide
average.
Bakken $2.4 billion
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North Dakota: Growth Brings Challenges…
Bakken activity rapidly accelerating
Industry must manage above-ground risk to
minimize impact to host communities:
 Ensuring workforce safety
 Protecting water quality
 Protecting air quality
 Minimizing impact on local infrastructure
 Living and working in local communities
Ensuring Workforce Safety
Industry Challenges:
• New/transient workforce
• Consistency
High activity levels and less
experienced workforce are leading
to poor safety performance and an
increased risk of serious injury or
death
 Hess workforce has invested
heavily in training and leadership
development
 Industry must join together in
setting common standards and
expectations around safety
Protecting Water Quality…
Industry Challenges:
• Fresh water use
• Water disposal
State blessed with abundant natural water
supply; Industry needs to play its part to
preserve it

Our commitment: Protect water quality through
precise drilling, appropriate sourcing, storage
and disposal of water used in drilling

Continually seeking innovative ways to reduce
water required for fracturing

Successfully piloted Reverse Osmosis Plant to
utilize brackish water for fracturing if necessary
Well pad at EN-Rehaka, Bakken
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Protecting Air Quality…
Industry Challenges:
• Flaring
• Emissions
Industry must work together to develop and
apply mitigating technologies
 Our current flaring levels are below the State
average and will decrease even further as
new capacity at the Tioga Gas Plant comes
online in 2013.
 Installation of four compressor stations to
reduce flaring across our operations
 50 vapor recovery units installed across
operations to capture gas that would
otherwise release into environment
 Industry/government must drive continuous
reductions in flaring
Tioga Gas Plant
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Minimizing Impact on Local Infrastructure…
Industry Challenge:
• Roads / truck traffic
• Facility construction
Shale energy operations are truck intensive - particularly in early development, meaning
more pressure on local roads
 At Hess we invest in mid-stream technology
to remove 200 trucks loads per day from
North Dakota roads
 Lean approach creates efficiency to minimize
truck movements
 Industry must work together to reduce
trucking and overall road traffic
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Living and Working in Local Communities…
Industry Challenge:
• Jobs
• Growth
• Quality of life
A cooperative public-industry partnership can
enhance industry benefits and mitigate the
challenges
Hess employees assisting with flood relief efforts
 Hess donated $1 million to aid flood relief efforts
 Hess donated $25 million to establish Succeed
2020 – a government education program in
North Dakota
 Opportunity for state -- Partner with
communities to accelerate infrastructure growth
Hess donating $25 million to Succeed 2020
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License to Operate: Socio-economic Impacts and
the Public-Industry Partnership
Ensuring workforce safety
Protecting water quality
Protecting air quality
Minimizing impact on local infrastructure
Living and working in local communities
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