Hess to spend $2.3 billion to develop Gulf of Mexico oil field

Hess Corp., the New York-based oil company, will develop its Tubular Bells deep-water field in the Gulf of Mexico at an estimated cost of $2.3 billion.

Production is expected to begin in 2014 and may peak at the equivalent of 45,000 barrels of oil a day, Hess said in a statement today. Subject to U.S. approval, Hess said it will own 57 percent of the field, with Chevron Corp. holding the remainder. BP Plc no longer owns a stake in the project.

Tubular Bells holds an estimated 120 million barrels of oil, Hess said. Plans call for three wells in the field, which lies as much as 4,600 feet (1,400 meters) below the surface about 135 miles southeast of New Orleans, the company said.

The field will be predominantly oil with “good, attractive returns, even though the costs per well have gone up a little bit with the new government regulations,” John Hess, chairman and chief executive officer of the company, said in a Sept. 8 speech.

The U.S. government imposed new drilling rules after a BP well in the Gulf last year had the biggest offshore oil spill in the nation’s history.

Hess fell 2 percent to $59.81 at 11:21 a.m. in New York. The shares have declined 22 percent this year.?

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