Hess Corp. (NYSE:HES) will sell its Russian subsidiary to the Kremlin-controlled OAO Lukoil for $2.05 billion, the U.S. company said Monday.
The deal to sell its Samara-Nafta unit, which is producing 50,000 barrels of oil equivalent per day in the Volga-Urals region of Russia, brings to $3.4 billion the value of its divestitures so far this year.
Shares rose more than 2 percent on the news.
CEO John B. Hess said the sales are part of a strategy to “transform Hess in to a more focused, higher growth, lower risk pure play exploration and production company.” Proceeds from these divestitures are being used to pay down debt.
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Also, Hess said, the moves give the New York-based company “the financial flexibility both to fund its future growth and also to direct most of the proceeds from addition asset sales to returning capital directly to its shareholders.”