Hess 2014 Annual Report Download - page 28

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The Corporation’s insurance policies renew at various dates each year. Future insurance coverage could increase in cost
and may include higher deductibles or retentions, or additional exclusions or limitations. In addition, some forms of
insurance may become unavailable in the future or unavailable on terms that are deemed economically acceptable.
Generally, the Corporation’s drilling contracts (and most of its other offshore services contracts) provide for a mutual hold
harmless indemnity structure whereby each party to the contract (the Corporation and Contractor) indemnifies the other party
for injuries or damages to their personnel and property (and, often, those of its contractors/subcontractors) regardless of fault.
Variations may include indemnity exclusions to the extent a claim is attributable to the gross negligence and/or willful
misconduct of a party. Third-party claims, on the other hand, are generally allocated on a fault basis.
The Corporation is customarily responsible for, and indemnifies the Contractor against all claims, including those from
third-parties, to the extent attributable to pollution or contamination by substances originating from its reservoirs or other
property (regardless of cause, including gross negligence and willful misconduct) and the Contractor is responsible for and
indemnifies the Corporation for all claims attributable to pollution emanating from the Contractor’s property. Additionally,
the Corporation is generally liable for all of its own losses and most third-party claims associated with catastrophic losses
such as damage to reservoirs, blowouts, cratering and loss of hole, regardless of cause, although exceptions for losses
attributable to gross negligence and/or willful misconduct do exist. Lastly, some offshore services contracts include overall
limitations of the Contractor’s liability equal to the value of the contract or a fixed amount.
Under a standard joint operating agreement (JOA), each party is liable for all claims arising under the JOA, to the extent of
its participating interest (operator or non-operator). Variations include indemnity exclusions when the claim is based upon
the gross negligence and/or willful misconduct of the operator, in which case the operator is solely liable. The parties to the
JOA may continue to be jointly and severably liable for claims made by third parties in some jurisdictions. Further, under
some production sharing contracts between a governmental entity and commercial parties, liability of the commercial parties
to the government entity is joint and several.
Environmental
Compliance with various existing environmental and pollution control regulations imposed by federal, state, local and
foreign governments is not expected to have a material adverse effect on the Corporation’s financial condition or results of
operations but increasingly stringent environmental regulations have resulted and will likely continue to result in higher
capital expenditures and operating expenses for us and the oil and gas industry in general. The Corporation spent
approximately $12 million in 2014 for environmental remediation, principally relating to the downstream businesses. The
level of other expenditures to comply with federal, state, local and foreign country environmental regulations is difficult to
quantify as such costs are captured as mostly indistinguishable components of the Corporation’s capital expenditures and
operating expenses. For further discussion of environmental matters see the Environment, Health and Safety section of
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Number of Employees
The number of persons employed by the Corporation was approximately 3,045 at December 31, 2014 and approximately
12,225 at December 31, 2013, of which approximately 8,700 related to the retail business which was sold in 2014.
Other
The Corporation’s internet address is www.hess.com. On its website, the Corporation makes available free of charge its
annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports
filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after the
Corporation electronically files with or furnishes such material to the Securities and Exchange Commission. The contents of
the Corporation’s website are not incorporated by reference in this report. Copies of the Corporation’s Code of Business
Conduct and Ethics, its Corporate Governance Guidelines and the charters of the Audit Committee, the Compensation and
Management Development Committee and the Corporate Governance and Nominating Committee of the Board of Directors
are available on the Corporation’s website and are also available free of charge upon request to the Secretary of the
Corporation at its principal executive offices. The Corporation has also filed with the New York Stock Exchange (NYSE) its
annual certification that the Corporation’s Chief Executive Officer is unaware of any violation of the NYSE’s corporate
governance standards.