Debt

12 Months Ended

Dec. 31, 2022

Debt Disclosure [Abstract]

Debt

7.  Debt

Total debt at December 31 consisted of the following:

	2022		2021
	(In millions)
Debt – Hess Corporation:
Senior unsecured fixed-rate public notes:
3.500% due 2024	$	300	$	299
4.300% due 2027	996		995
7.875% due 2029	464		464
7.300% due 2031	629		628
7.125% due 2033	537		537
6.000% due 2040	742		742
5.600% due 2041	1,237		1,236
5.800% due 2047	494		494
Total senior unsecured fixed-rate public notes	5,399		5,395
Term loan facility	—		497
Fair value adjustments – interest rate hedging	(4)		2
Total Debt – Hess Corporation	$	5,395	$	5,894
Debt – Midstream (Hess Midstream Operations LP):
Senior unsecured fixed-rate public notes:
5.625% due 2026	$	793	$	791
5.125% due 2028	544		543
4.250% due 2030	740		739
5.500% due 2030	395		—
Total senior unsecured fixed-rate public notes	2,472		2,073
Term Loan A facility	396		387
Revolving credit facility	18		104
Total Debt – Midstream	$	2,886	$	2,564
Total Debt:
Current portion of long-term debt	$	3	$	517
Long-term debt	8,278		7,941
Total Debt	$	8,281	$	8,458

At December 31, 2022, the maturity profile of total debt was as follows:

	Total		Hess Corporation		Midstream
	(In millions)
2023	$	3	$	—	$	3
2024	312		300		12
2025	22		—		22
2026	833		—		833
2027	1,348		1,000		348
Thereafter	5,838		4,138		1,700
Total Borrowings	8,356		5,438		2,918
Less: Deferred financing costs and discounts	(75)		(43)		(32)
Total Debt (excluding interest)	$	8,281	$	5,395	$	2,886

In 2022, capitalized interest was $10 million (2021: $0 million; 2020: $0 million).

Debt – Hess Corporation:

Senior unsecured fixed-rate public notes:

At December 31, 2022, Hess Corporation’s fixed-rate senior unsecured notes had a gross principal amount of $5,438 million (2021: $5,438 million) and a weighted average interest rate of 5.9% (2021: 5.9%). The indentures for our fixed-rate senior unsecured notes limit the ratio of secured debt to Consolidated Net Tangible Assets (as that term is defined in the indentures) to 15%. As of December 31, 2022, Hess Corporation was in compliance with this financial covenant.

Term loan and credit facility:

In March 2020, we entered into a $1 billion three year term loan agreement with a maturity date of March 16, 2023. In July 2021, we repaid $500 million of the $1 billion outstanding under the term loan. In February 2022, we repaid the remaining $500 million, which was classified as Current portion of long-term debt in our Consolidated Balance Sheet at December 31, 2021.

In July 2022, Hess Corporation replaced its $3.5 billion revolving credit facility expiring in May 2024 with a new $3.25 billion revolving credit facility maturing in July 2027. The new facility, which is fully undrawn, can be used for borrowings and letters of credit. Borrowings on the new facility will generally bear interest at 1.400% above SOFR, though the interest rate is subject to adjustment based on the credit rating of the Corporation's senior, unsecured, non-credit enhanced long-term debt. At December 31, 2022, Hess Corporation had no outstanding borrowings or letters of credit under this facility.

The revolving credit facility is subject to customary representations, warranties, customary events of default and covenants, including a financial covenant limiting the ratio of Total Consolidated Debt to Total Capitalization of the Corporation and its consolidated subsidiaries to 65%, and a financial covenant limiting the ratio of secured debt to Consolidated Net Tangible Assets of the Corporation and its consolidated subsidiaries to 15% (as these capitalized terms are defined in the credit agreement for the revolving credit facility). As of December 31, 2022, Hess Corporation was in compliance with these financial covenants.

Other outstanding letters of credit at December 31 were as follows:

	2022		2021
	(In millions)
Committed lines	$	—	$	29
Uncommitted lines (a)	83		230
Total	$	83	$	259

(a)At December 31, 2022, uncommitted lines have expiration dates through 2023.

The most restrictive of the financial covenants related to our fixed-rate senior unsecured notes and revolving credit facility would allow us to borrow up to an additional $2,146 million of secured debt at December 31, 2022.

Debt – Midstream:

Senior unsecured fixed-rate public notes:

At December 31, 2022, HESM Opco’s fixed-rate senior unsecured notes had a gross principal amount of $2,500 million (2021: $2,100 million) and a weighted average interest rate of 5.1% (2021: 5.0%). HESM Opco's senior unsecured notes are guaranteed by certain of HESM Opco’s direct and indirect wholly owned material domestic subsidiaries. These senior unsecured notes are non-recourse to Hess Corporation.

In April 2022, HESM Opco issued $400 million in aggregate principal amount of 5.500% fixed-rate senior unsecured notes due in 2030 in a private offering to repay borrowings under its revolving credit facility used to finance the repurchase of approximately 13.6 million HESM Opco Class B units held by Hess and GIP. In August 2021, HESM Opco issued $750 million in aggregate principal amount of 4.250% fixed-rate senior unsecured notes due in 2030 in a private offering to finance the repurchase of 31.25 million HESM Opco Class B units held by Hess and GIP.

Credit facilities:

In July 2022, HESM Opco amended and restated its credit agreement for its $1.4 billion of senior secured syndicated credit facilities consisting of a $1.0 billion revolving credit facility and a fully drawn $400 million term loan facility. The amended and restated credit agreement, among other things, extended the maturity date from December 2024 to July 2027, increased the accordion feature to up to an additional $750 million, which does not represent a lending commitment from the lenders, and replaced LIBOR as the benchmark interest rate with SOFR. Borrowings under the new term loan facility will generally bear interest at SOFR plus an applicable margin ranging from 1.650% to 2.550%, while the applicable margin for the new syndicated revolving credit facility ranges from 1.375% to 2.050%. Pricing levels for the facility fee and interest-rate margins are based on HESM Opco’s ratio of total debt to EBITDA (as defined in the credit facilities).  If HESM Opco obtains an investment grade credit rating, the pricing levels will be based on HESM Opco’s credit ratings in effect from time to time. The credit facilities contain covenants that require HESM Opco to maintain a ratio of total debt to EBITDA (as defined in the credit facilities) for the prior four fiscal quarters of not greater than 5.00 to 1.00 as of the last day of each fiscal quarter (5.50 to 1.00 during the specified period following certain acquisitions) and, prior to HESM Opco obtaining an investment grade credit rating, a ratio of secured debt to EBITDA for the prior four fiscal quarters of not greater than 4.00 to 1.00 as of the last day of each fiscal quarter.  HESM Opco was in compliance with these financial covenants at December 31, 2022. The credit facilities are secured by first-priority perfected liens on substantially all of the assets of HESM Opco and its direct and indirect wholly owned material domestic subsidiaries, including equity interests directly owned by such entities, subject to certain customary exclusions.  At December 31, 2022, borrowings of $18 million were drawn under HESM Opco’s revolving credit facility, and borrowings of $400 million, excluding deferred issuance costs, were drawn under HESM Opco’s Term Loan A facility.  Borrowings under these credit facilities are non-recourse to Hess Corporation.