U.S. oil producer and refiner Hess Corp increased its 2010 capital spending plans by 22 percent, devoting $1 billion more to production alone and reversing much of the reduction made this year.

Hess said on Monday its 2010 capital and exploratory budget would be $3.9 billion, with $2.4 billion for production, $600 million for developments and $850 million for exploration.

“We are fortunate to have a strong portfolio of attractive investment opportunities,” Chief Executive John Hess said in a statement, adding he expected to fund 2010 spending from internally generated cash flow.

Hess had set aside $3.2 billion for 2009 capital spending, down sharply from $4.4 billion the previous year.

In 2010, production expenditures will go toward projects, including North Dakota’s Bakken Shale, where Hess will boost its rig count to eight next year from three now, and projects in Equatorial Guinea, the Gulf of Mexico, Britain and Norway.

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