Hess 2014 Annual Report Download - page 110
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* At December 31, the standardized measure of discounted future net cash flows relating to proved reserves in Norway were as follows:
2014 2013 2012
(In millions)
F
uture revenues .................................................................................................................................................................... $ 27,502 $ 29,668 $ 33,974
L
ess:
Future production costs (a) ............................................................................................................................................ 8,159 11,538 9,734
Future development costs ............................................................................................................................................... 7,318 7,22
6
4,50
7
Future income tax expenses (b) ..................................................................................................................................... 6,683 5,56
7
12,93
6
22,16
0
24,331 27,17
7
F
uture net cash flows (b) ...................................................................................................................................................... 5,342 5,33
7
6,79
7
L
ess: Discount at 10% annual rate (b) ................................................................................................................................ 2,792 2,483 2,563
Standardized measure of discounted future net cash flows (b) ........................................................................................... $ 2,55
0
$ 2,854 $ 4,234
(a) Future production costs for 2014 decreased primarily due to the reduction of projected well workover and related costs by the operator of the Valhall Field based
on the operator’s well life study completed in 2014 and the impact of changes in foreign exchange rates associated with the strengthening of the U.S. dollar versus
the Norwegian Krone.
(b) Future income taxes for 2012 have been restated as described above. Future income taxes for 2013 have been restated to include the impact of deductions for
abandonment costs at the end of field life to be consistent with 2012. Previous amounts reported in the 2013 Form 10-K were as follows: future income tax
expenses - $6,661 for 2013 and $14,976 for 2012; future net cash flows -$4,243 for 2013 and $4,757 for 2012; discount at 10% annual rate – $1,419 for 2013 and
$1,587 for 2012; and standardized measure of discounted future net cash flows - $2,824 for 2013 and $3,170 for 2012.
Changes in Standardized Measure of Discounted Future Net Cash Flows Relating to Proved Oil and Gas Reserves
For the Years Ended December 31 2014 2013 2012
(In millions)
Standardized measure of discounted future net cash flows at January 1* ...................................
.
$ 20,460 $ 23,232 $ 20,841
Changes during the year
Sales and transfers of oil and gas produced during the year, net of production costs .............
.
(6,637) (7,507) (8,141)
Development costs incurred during year .................................................................................
.
4,702 5,051 6,790
Net changes in prices and production costs applicable to future production ..........................
.
(4,657) (2,847) 1,678
Net change in estimated future development costs .................................................................
.
(485) (2,798) (2,181)
Extensions and discoveries (including improved recovery) of oil and gas reserves, less
related costs ................................................................................................................. .......
.
2,249 3,836 3,612
Revisions of previous oil and gas reserve estimates ...............................................................
.
(161) (1,189) 1,890
Net purchases (sales) of minerals in place, before income taxes ............................................
.
(2,157) (3,905) (1,856)
Accretion of discount ..............................................................................................................
.
3,243 4,038 4,032
Net change in income taxes* ...................................................................................................
.
3,180 6,191 (336)
Revision in rate or timing of future production and other changes .........................................
.
(2,735) (3,642) (3,097)
Total* .................................................................................................................................
.
(3,458) (2,772) 2,391
Standardized measure of discounted future net cash flows at December 31* ..............................
.
$ 17,002 $ 20,460 $ 23,232
*Previous amounts reported in the 2013 Form 10-K were as follows: net change in income taxes - $8,834 for 2013 and ($1,906) for 2012; total changes during the
year – ($129) for 2013 and $821 for 2012; and standardized measure of discounted future net cash flows at January 1, 2012 – $19,738, at December 31, 2012 –
$20,599, and at December 31, 2014 – $20,430.