April 28, 2010 / 5:32 PM / 8 years ago

UPDATE 2-Hess posts quarterly profit on oil price bounce

* Q1 EPS of $1.65 versus year-ago loss of 18 cents

* Beats analyst estimates, shares up 0.6 pct

* Oil and gas output 423,000 boe/day, topping estimates

NEW YORK/SAN FRANCISCO, April 28 (Reuters) - Hess Corp (HES.N) reported on Wednesday a first-quarter profit as oil prices nearly doubled in the past year and the company recorded a gain from selling its stake in an Indonesian gas project.

The U.S. producer and refiner said oil and gas output was 423,000 barrels oil equivalent (boe) per day in the quarter, up from 390,000 a year ago and ahead of analysts’ expectations.

“This increase resulted primarily from higher production from the Shenzi and Conger fields in the deepwater Gulf of Mexico and the JDA (joint development area) in the Gulf of Thailand,” Chief Executive John Hess told analysts on a conference call.

The New York-based company said its quarterly profit was $538 million, or $1.65 per diluted share, compared with a year-earlier loss of $59 million, or 18 cents per share.

Excluding certain items, Hess earned $1.49 per share, compared with the average analyst estimate of $1.09, according to Thomson Reuters I/B/E/S.

The earnings were helped by a surge in oil prices, with U.S. benchmark crude averaging nearly $79 in the first quarter, up $3 on the quarter before and compared with just $43 in the first quarter of 2009.

Rising oil prices have led to an acceleration of drilling in North Dakota’s Bakken oil shale, where Hess said its net production reached 13,000 boe per day in March.

“We currently have five rigs dedicated to drilling Bakken wells, and we plan to add five additional rigs over the next 12 months,” said Hess, the son of the company’s late founder who has been CEO since 1995.

Hess shares were 0.6 percent higher at $63.73 in afternoon trading. The stock has gained 5 percent in 2010, compared with 3 percent for the Chicago Board Options Exchange index of oil companies .OIX.

In the first quarter, Hess included a gain of $58 million on the sale of its interest in Indonesia’s Jambi Merang natural gas development to Talisman Energy Inc TLM.TO. (Reporting by Matt Daily in New York and Braden Reddall in San Francisco; Editing by Lisa Von Ahn and Gunna Dickson)

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