Hess 2008 Annual Report Download - page 22

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Brazil: The Corporation has interests in two blocks located offshore Brazil, the BM-S-22 Block (Hess 40%)
in the Santos Basin and the BM-ES-30 Block (Hess 60%) in the Espirito Santo Basin. The operator commenced
drilling of the Azulao exploration well on BM-S-22 in 2008 and filed a Notice of Discovery with the regulators on
January 16, 2009. The operator plans to drill another well on BM-S-22 in 2009.
Oil and Gas Reserves
The Corporation’s net proved oil and gas reserves at the end of 2008, 2007 and 2006 are presented under
Supplementary Oil and Gas Data on pages 75 through 81 in the accompanying financial statements.
During 2008, the Corporation provided oil and gas reserve estimates for 2007 to the United States Department
of Energy. Such estimates are consistent with the information furnished to the SEC on Form 10-K for the year ended
December 31, 2007, although not necessarily directly comparable due to the requirements of the individual
requests. There were no differences in excess of 5%.
Sales commitments: The Corporation has no contracts or agreements to sell fixed quantities of its crude oil
production. In the United States, natural gas is marketed by the M&R segment on a spot basis and under contracts
for varying periods to local distribution companies, and commercial, industrial and other purchasers. The
Corporation’s United States natural gas production is expected to approximate 20% of its 2009 sales
commitments under long-term contracts. The Corporation attempts to minimize supply risks associated with its
United States natural gas supply commitments by entering into purchase contracts with third parties having reliable
sources of supply, on terms substantially similar to those under its commitments and by leasing storage facilities.
Outside of the United States, the Corporation generally sells its natural gas production under long-term sales
contracts at prices that are periodically adjusted due to changes in commodity prices or other indices. In the United
Kingdom, the Corporation sells the majority of its natural gas production on a spot basis.
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