As a Company, we believe that sound sustainability practices create value and enhance business performance. Despite the significant decline in oil prices that began at the end of 2014, our commitment to operational excellence, safety, environmental stewardship, stakeholder engagement and corporate citizenship is unwavering.

Hess workforce (employee and contractor) safety performance improved 26% between 2013 and 2014 and resulted in a Total Recordable Incident Rate of 0.39, our best safety performance since we began tracking data in 2004. We attribute this improvement to our continued focus on leadership engagement site visits, behavior based safety programs and improvements in our contractor management, selection and on-boarding process. In 2014, we conducted over 1,000 leadership site visits and 80,000 safety observations at our field locations. We also focused on closing out environment, health and safety audit findings, and sharing lessons learned across the enterprise. Looking forward, we plan to reinforce these programs in 2015 with the aim of “everyone, everywhere, every day, home safely.”

Continuing to improve and enhance our process safety program is critical to strengthening our ability to manage potentially catastrophic risks in our business. We track our process safety performance using the International Oil and Gas Producers Recommended Practice for Key Performance Indicators and are expanding our use of leading indicators in 2015. To raise process safety awareness we conducted training in 2013 and 2014 for our employees across the enterprise. We plan to continue this training in 2015. We also addressed a majority of the process safety concerns identified during our 2013 Process Safety Health Checks, with the remaining action items to be completed primarily in 2015.

The company’s health and wellness strategy includes health risk assessment and planning, industrial hygiene and control of workplace exposures, fitness for task assessment, medical emergency management and public health interface. We provide access to free preventive medical services, international travel vaccinations and flu shots to employees and family members. In 2014, we began conducting Health Gap Assessments at select locations. These Health Gap Assessments highlighted the need to focus on further industrial hygiene monitoring and practices. Onsite mobile health testing was implemented in North Dakota and Seminole to enhance our fitnessfor- work and medical surveillance programs to ensure that employees are capable of safely doing their jobs. In addition to meeting Department of Transportation compliance requirements, in 2014 we expanded random Drug and Alcohol testing at U.S. onshore and offshore locations for employees and contractors.

As part of our diversification strategy, over 25% of our business is now concentrated in lower risk, high return unconventional resources. The potential effects of shale energy operations on the environment, public health and safety are well recognized by Hess, and we employ multi-disciplinary risk management to drive planning and decision making. Our unconventional activities undergo several stages of detailed, activity Hess sponsored school, Equatorial Guinea based risk assessment during the capture, appraisal, drilling and production phases of operations to ensure that we are operating in a safe and environmentally responsible manner. We believe that shale energy development is a game changer for our industry which has helped move the United States towards energy independence and provide lower-cost affordable energy.

Meeting the long term global demand for energy will require a comprehensive strategy that includes fossil fuels as well as renewables for many years to come. We see climate change as a global challenge that requires cooperation between world leaders, civil society and industry to develop comprehensive energy and climate solutions. Hess will continue to do its part to monitor, measure and take steps to develop resources in an environmentally responsible manner.

Since 2008, we have reduced our greenhouse gas footprint by four million tonnes through improved operating practices and asset divestitures. Since 2008 we have reduced our flaring in Algeria by 95%. We are also on target to reduce our flaring rate at the wellhead in North Dakota to 10% by 2017, possibly earlier, depending on the timely completion of infrastructure projects, many of which are subject to obtaining permits and rights of way. Since 2012 we have factored in the cost of carbon in evaluating new projects over $50 million and have now integrated this assessment as part of annual asset value assurance reviews. This analysis enables us to understand and address potential regulatory risks and promote more carbon efficient choices for equipment investment decisions.

In 2014 the Company continued engagement in a number of multi-stakeholder initiatives designed to advance transparency, environmental protection, human rights and good governance. We presented on our progress in implementing our human rights policies at the annual plenary meeting of the Voluntary Principles on Security and Human Rights. We began work on a high level human rights risk assessment at one asset and conducted two security and human rights workshops. Hess continues to be actively involved in the United Nations Global Compact (UNGC) and serves on the Board of the US UNGC Network which shares best practices in sustainable business conduct across the private sector. Hess was also added to the United Nations Global Compact 100 index.

We recognize the important role stakeholders play in our access to resources and our license to operate. We have strengthened our approach to stakeholder engagement and are deepening our understanding of 11 our stakeholders and their expectations. In 2014 we began integrating stakeholder issues and engagement into our enterprise risk workshops, value assurance reviews and asset business plans. We also continued development of a grievance mechanism and stakeholder engagement platform to help assets efficiently capture, track and follow up on stakeholder feedback. Two assets in North America are poised to launch the platforms in early 2015 and two global assets planned by year end.

Our flagship social investment programs continued to make good progress in 2014. The second phase of our education initiative, the Program for Education Development of Equatorial Guinea (PRODEGE), got underway in Equatorial Guinea. The program distributed 115,000 student guides for 33,000 students in grades two and three, as well as first grade student report cards and other learning materials to all primary schools across the country. PRODEGE staff also conducted intensive training for teachers and school supervisors on how to use these tools as part of the active learning approach. PRODEGE is proving to be an enduring program and is being integrated into education delivery. The Ministry of Education has established a unit within the ministry to expand active learning to all primary schools. The University of Equatorial Guinea has established a faculty of education in order to strengthen and sustain in service and pre-service teacher training. Planning is underway to launch the junior secondary elements of the program in 2015.

In North Dakota SUCCEED 2020, which aims to improve the transition from secondary school to higher education and the workplace, entered its third year. In addition to providing professional development to some 2500 teachers, administrators and college and career counselors, the program engaged more than 250 businesses across the state. Businesses participated in career fairs, hosted job shadows and internships and advised on curricula and programs. More than 2500 students from 66 school districts participated in eight college and career fairs and more than 3000 students participated in SUCCEED 2020 Science, Technology, Engineering and Math (STEM) activities ranging from robotics clubs to project-based coursework.

With our transformation to a pure play exploration and production company complete, we have begun a comprehensive review of our environment, social and governance strategy. Through this work, we will enhance our value proposition by driving operational effectiveness, reducing risk, aligning with our core business, protecting our license to operate and helping us anticipate and manage stakeholder expectations. We expect the strategy refresh to be complete by late 2015.

For the sixth consecutive year, Hess was included in the CDP S&P 500 Leadership Index for our climate change reporting. Hess was one of only ten U.S. based companies to earn a spot on Corporate Knights’ 100 Most Sustainable Corporations list. Since 2008 Hess has been named to the Corporate Responsibility Magazine’s 100 Best Corporate Citizens List. The company was also listed in the 2014 Dow Jones Sustainability Index North America for the fifth consecutive year and achieved other investor and media recognition for our sustainability efforts. More detailed discussion of our environment, social and governance programs, progress and performance data can be found in our corporate sustainability report.