Hess Selling Russian Operation to LUKOIL for $2 Billion

Continuing its years-long corporate restructuring, oil company Hess (NYSE: HES  ) is selling its 90% interest in Russia's Samara-Nafta (literally "Samara Oil") to local oil major OAO LUKOIL for total consideration of $2.05 billion, the company announced today.

So far this year, Hess has announced the sale of, or sold, interests in the North Sea Beryl field, the Texas Eagle Ford play, and the Azeri, Chirag, and Guneshli fields in Azerbaijan.

After-tax proceeds to Hess from the sale announced today are expected to amount to roughly $1.8 billion, and will bring Hess' total income from divestitures to $3.4 billion year-to-date. Samara-Nafta is currently producing 50,000 barrels of oil equivalent per day in the Volga-Urals region of Russia.

Hess Chief Executive Officer John B. Hess says all of these far-flung sales are part of a plan "to transform Hess into a more focused, higher growth, lower risk pure play exploration and production company." The CEO says it's equally important to note that the cash Hess is raising from the sales will help it to reduce its debt load and strengthen its balance sheet -- currently burdened by roughly $7.5 billion in net debt.

Hess shares are up 3.3% as of this writing, just shy of $74 a share.

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