Gregory P. Hill
President and Chief Operating Officer at Hess
Thanks, John. 2021 was another year of strong operating performance and strategic execution for Hess. Starting with reserves, proved reserves at the end of 2021 stood at 1.3 billion barrels of oil equivalent. Net proved reserve additions in 2021 totaled 348 million barrels of oil equivalent, including positive net price revisions of 107 million barrels of oil equivalent, resulting in an overall 2021 production replacement ratio of 295% and a finding and development cost of approximately $5.25 per barrel of oil equivalent.
Now, turning to production. In the fourth quarter and full year 2021, company-wide net production averaged 295,000 barrels of oil equivalent per day, excluding Libya -- in line with our guidance. For the full year 2022, we forecast net production to increase by 12% to 15% and average between 330,000 and 340,000 barrels of oil equivalent per day, excluding Libya. For the first quarter of 2022, we forecast net production to average between 275,000 and 285,000 barrels of oil equivalent per day, excluding Libya. This forecast reflects the impact of severe winter weather in the Bakken, remedial maintenance work at the Baldpate and Penn State fields in the Gulf of Mexico and planned downtime on the Liza Destiny FPSO for production optimization work.
Company-wide net production is forecast to significantly increase over the course of the year, driven both by Guyana and the Bakken, with the fourth quarter expected to average between 360,000 and 370,000 barrels of oil equivalent per day. In the Bakken, both fourth quarter and full year 2021 net production were in line with our guidance, averaging 159,000 and 156,000 barrels of oil equivalent per day respectively.
We have a robust inventory of approximately 2,100 drilling locations in the Bakken that can generate attractive returns at $60 WTI, representing approximately 70 rig years of activity. In 2022, we plan to operate three rigs and expect to drill approximately 90 gross operated wells and bring approximately 85 new wells online. In the first quarter of 2022, we plan to drill approximately 22 wells and bring 10 new wells online. For the balance of the year, we expect to bring online an average of 25 wells per quarter.
In 2021, our drilling and completion cost per Bakken well averaged $5.8 million, which was $400,000 or 6% lower than 2020. In 2022, we expect to fully offset anticipated inflation through lean manufacturing and technology driven efficiency gains, and therefore D&C costs are expected to be flat with last year at approximately $5.8 million per well.
For the full year 2022, we forecast Bakken net production to average between 165,000 and 170,000 barrels of oil equivalent per day, a 6% to 9% increase over 2021. First quarter net production is forecast to average between 155,000 and 160,000 barrels of oil equivalent per day. Beginning in the second quarter, we expect to benefit from the addition of the third rig, which we added last September, and improving weather conditions. Net Bakken production is forecast to steadily ramp over the course of 2022 and to average between 175,000 and 180,000 barrels of oil equivalent per day in the fourth quarter.
Moving to the offshore, in the deepwater Gulf of Mexico, net production averaged 39,000 barrels of oil equivalent per day in the fourth quarter and 45,000 barrels of oil equivalent per day for the full year 2021, in line with our guidance. The deepwater Gulf of Mexico remains an important cash engine for the company as well as a platform for growth. In 2022, we will resume drilling operations after a two-year hiatus, with one tieback well planned at the Shell-operated Llano Field and one exploration well planned at the Hess-operated Huron prospect on Green Canyon Block 69.
Over the last five years, we have focused our efforts on getting best-in-class imaging across our acreage position in northern Green Canyon, where we believe there is high potential for multiple, high-return hub class Miocene opportunities. Huron is the first of these opportunities, which attracted interest from multiple parties during the farmout process. We expect to spud Huron in the first quarter, with Hess having a 40% working interest as operator and Shell and Chevron at 30% each. As part of our agreements with Shell and Chevron, we have also accessed additional Miocene prospects across Green Canyon and are excited about further potential in the play.
In February, Shell plans to spud the Llano-6 development well, in which Hess has a 50% working interest. The well will be tied back to Shell's Auger platform, with gross production from the well expected to build to a plateau rate of between 10,000 and 15,000 barrels of oil equivalent per day by the end of this year. For the full year 2022, we forecast net production in the Gulf of Mexico to average approximately 35,000 barrels of oil equivalent per day. First quarter net production is forecast to average between 30,000 and 35,000 barrels of oil equivalent per day.
In Southeast Asia, net production from the Joint Development Area and North Malay Basin, where Hess has a 50% interest, averaged 66,000 barrels of oil equivalent per day in the fourth quarter and 61,000 barrels of oil equivalent per day for the full year 2021, in line with our guidance. For the full year 2022, we forecast net production in Southeast Asia to average approximately 65,000 barrels of oil equivalent per day. In the first quarter, we forecast net production to average between 60,000 and 65,000 barrels of oil equivalent per day.
Turning to Guyana, where Hess has a 30% interest in the Stabroek Block and ExxonMobil is the operator. We have continued our extraordinary run of exploration success and increased our estimate of gross discovered recoverable resources to more than 10 billion barrels of oil equivalent. Net production from Guyana averaged 31,000 barrels of oil per day in the fourth quarter of '21 and 30,000 barrels of oil per day for the full year 2021, in line with our guidance.
For the full year 2022, we forecast net production in Guyana to average between 65,000 and 70,000 barrels of oil per day. In the first quarter, we forecast net production from Guyana to average between 25,000 and 30,000 barrels of oil per day, reflecting planned downtime on the Liza Destiny for production optimization as previously mentioned and net production in the fourth quarter to increase to between 85,000 and 90,000 barrels of oil per day.
Earlier this month, we announced significant discoveries on the Stabroek Block at Fangtooth and Lau Lau. Positive results at Fangtooth, our first standalone deep exploration prospect, help confirm the deeper exploration potential of the Stabroek Block. In the coming months, we will complete the analysis of the exploration well results. Appraisal activities will then be conducted to determine the optimum development approach and timing. Lau Lau further underpins our queue of future low-cost development opportunities in the southeastern portion of the Stabroek Block. This discovery will also require appraisal to determine the ultimate development approach and timing.
We continue to see multi-billion barrels of exploration potential on the Stabroek Block and, in 2022, we plan to drill approximately 12 exploration and appraisal wells that will target a variety of prospects and play types. These will include lower risk wells near existing discoveries, higher risk step outs and several penetrations that will test deeper lower Campanian and Santonian intervals.
Exploration wells planned for the first quarter of 2022 include: Barreleye-1, located approximately 20 miles southeast of Liza. The primary target is lower Campanian with shallow and deeper secondary targets. The well spud on December 30; Tarpon-1, located approximately 63 miles northwest of Liza, will target lower Campanian clastics, plus a deeper Jurassic carbonate. The well will spud following completion of Fangtooth operations; Patwa-1 is near our Turbot area discoveries. The well is approximately 3 miles northwest of the Cataback-1 discovery, with targets in upper Cretaceous clastic reservoirs. This well is anticipated to spud in March; Lukanani-1 is in the southeastern part of the Stabroek Block, located approximately 2 miles west of Pluma and is anticipated to spud in March. The primary target is Maastrichtian age clastic reservoirs, with secondary objectives in lower Campanian reservoirs.
The appraisal program in 2022 will be focused on delineating future developments. First quarter appraisal activities will include the Tilapia-2 appraisal well, located approximately 24 miles southeast of Liza-1. The well will appraise the February 2019 Tilapia-1 discovery in the Turbot area and is anticipated to spud in March. In addition, we plan to conduct drill stem tests at Tilapia-1 and Pinktail-1.
Turning now to our Guyana developments. Development activity this year will include drilling for both the Liza Phase 2 and Payara projects. Initial development drilling activities will also begin for the Yellowtail project following approval of the Field Development Plan by the government. A planned turnaround will be conducted in March on the Liza Destiny FPSO. Work activities will include production optimization work designed to increase the vessel's production capacity.
At Liza Phase 2, the Liza Unity FPSO vessel is undergoing final hookup and commissioning after arriving in Guyanese waters in October 2021. Unity is on track to start production in the first quarter of 2022 with a capacity of approximately 220,000 gross barrels of oil per day.
With regard to our third development, at Payara, the overall project is 66% complete. SURF activities are progressing ahead of plan and we are preparing for a 2022 installation campaign. The hull for the Prosperity FPSO vessel is complete and topside construction activities are ongoing in Singapore for planned production start-up in 2024.
The Field Development Plan and Environmental Impact Assessment for the fourth potential project, Yellowtail, have been submitted for government and regulatory review. The government is supportive of the project and startup remains on track for 2025. We look forward to continuing to work with the Government of Guyana and our partners to realize the extraordinary potential of this world-class project.
Moving to Suriname, planning is underway for our second exploration well on Block 42 at the Zanderij-1 prospect targeting the Santonian and Deep play potential. The operator, Shell, has indicated that they expect to drill the well around mid-year. We see the acreage as a potential play extension from the Stabroek Block, with similar play types and trap styles. Shell, Chevron and Hess each have a one-third working interest in Block 42.
In closing, our execution continues to be strong. The start up of Liza Phase 2 and steadily increasing production in the Bakken are expected to drive an approximate 30% increase in net production between the first quarter and fourth quarter of 2022 along with a significant increase in operating cash flow, which will underpin our commitment to increase cash returns to shareholders.
I will now turn the call over to John Rielly.