Posted on 02/26/2006 2:50:29 PM PST by thackney
ConocoPhillips Alaska Inc. is having one of its busiest winter drilling and construction seasons in years on the North Slope, according to its president, Jim Bowles. Drilling and well-workover activity in the Kuparuk River field is at levels not seen since the early 1980s, when the field was first developed.
Bowles briefed state legislators in Juneau on the company's activities and presented other information at the Alaska Support Industry Alliance annual Meet Alaska conference in late January.
He said that ConocoPhillips has 2.2 million man-hours of construction underway this winter, a 50 percent increase over 2005 construction activity. In terms of rig activity, there will be 60 months of rig and coiled-tubing rig activity this year, up from 45 months last year.
Along with partners, ConocoPhillips will invest $1.5 billion in new projects over the next two to three years, including a new viscous oil project that started production in December 2005.
The recently completed project is the 1-J viscous oil pad in West Sak, a part of the Kuparuk River field, began production on schedule in December, following the earlier startup of new viscous oil wells on the nearby 1-E pad. The new projects will bring West Sak viscous oil production to 45,000 barrels per day. ConocoPhillips and its partners in West Sak, which include BP Exploration (Alaska) Inc. and Exxon Mobil Corp., invested $500 million in the project, Bowles said.
In the Alpine field, west of Kuparuk, two new satellites are being developed and are due to begin production later this year. The two new satellite fields are Nanuq and Fiord, both on state leases on the Colville River delta near the Alpine field. Fiord is expected to begin production this fall with 17 wells, while Nanuq will be in production later this year with 23 wells.
Together, the two satellites will add 30,000 barrels of new production from the North Slope. ConocoPhillips and its minority partner, Anadarko Petroleum Corp., will have spent $500 million in the two satellites.
Bowles said his company and Anadarko are in the permitting stage for development of two additional Alpine satellites, Alpine West and Lookout. These are scheduled to begin production in 2008 or 2009 and will require investment of an additional $500 million. Alpine West and Lookout will be the first commercial productions from the National Petroleum Reserve-Alaska.
ConocoPhillips is also participating in seven exploration wells this winter, along with a 3-D seismic survey in the Teshekpuk Lake area of the northeastern area of NPR-A, Bowles said. The U.S. Bureau of Land Management plans a lease sale in the area next fall. ConocoPhillips will also participate in a seismic survey in the Chukchi Sea Outer Continental Shelf off Alaska's northwest coast in anticipation of a planned federal OCS lease sale in 2007.
Among the 2006 winter projects are three "delineation" wells being drilled in the Kuparuk River field. The wells are aimed at testing undeveloped parts of the West Sak viscous oil deposits to the north of parts of the West Sak now being produced. The company has planned a phased development program for West Sak, starting with the better-quality portions of the reservoir and expanding, over time, to areas believed to be of lesser quality. The test wells planned this winter will help the company evaluate other parts of the West Sak for possible development.
West Sak is a large deposit of heavy, or viscous, oil that overlays the main conventional oil reservoir in the Kuparuk River field. The resources are very large in terms of volume of oil physically present in the reservoir rock - the "in-place" resource is billions of barrels - but producing the oil has presented cost and technology challenges.
It is only in recent years that ConocoPhillips and BP, which is working with similar viscous oil in the Milne Point and Prudhoe fields, have found ways to make viscous oil production economically viable. New technologies like multi-lateral wells and long, extended-reach horizontal production wells have been crucial in making the projects economically viable.
Tim Bradner can be reached at tim.bradner@alaskajournal.com.
The sun sets on ConocoPhillips' facilities at its Alpine field in this photo provided by the company. ConocoPhillips, along with Anadarko Petroleum Corp., expects two Alpine satellite fields, Nanuq and Fiord, to both start production by the end of the year. Together, the two fields should add about 30,000 barrels of new production from the North Slope. The two companies are also in the permitting stage for two more satellite fields adjacent to Alpine.
PHOTO/ConocoPhillips
More information on CD5 (Alpine West) at:
http://www.conocophillipsalaska.com/permits/CD5/index.htm
Darn! My broker was right 20 years ago. I should never have sold my Conoco stock! Bahwahwahwahwah! :o(
No North Slope oil goes to Japan. 100% of Alaskan North Slope oil is kept in America. This has been the case for all but 4 years of the nearly 3 decades of Alaskan oil production. Between 1996-1999 5.5% of North Slope oil was exported to Asian countries. These exports were overwhelmingly supported by the US Congress and by the Clinton Administration to offset an oil glut in California at the time. In June 2000 Alaskan oil again ceased to be exported, and 100% of Alaskan Pipeline Oil production has stayed in America.
Apparently anti-Bush college activists are still crying about how caribou are going to go extinct because of Alaskan pipeline drilling. I couldn't believe this when a girl at work was talking about it. I LOL!!! She got mad and I told her they were saying that 30 years ago when I was in elementary school! Then everyone laughed! She stormed off.
Thank you for the feedback. Great news on my part. Have had that quetion on my mind for a number of years and never seeked the answer.
Ponca City, OK (Conoco) bump
The facts are even better. The Central Arctic Caribou Herd, which calved in the area prior to the Prudhoe Bay and Kuparuk Oil fields, has grown 8 to 10 times in size in the past three decades of oil production. This herd is also in a much smaller area than the Porcupine Herd of ANWR and has had a much larger percentage of their area impacted than that proposed on the Coastal Plain of ANWR.
Hope you guys don't mind me jumping in. I love threads on AK oil and gas.
There is a liquified natural gas project in southern AK that does export to Asia. I believe that is part of why rumors get started that Alaskan crude oil is exported to asia. The volume is pretty small, and if I am up to date, the project is more an experiment and off shoot of another project rather than stand alone economical production.
We could use the LNG here, but there is no U.S. west coast terminal to recieve the product. Proposals to exploit such a resource meet resistance from the usual suspects. Alot of Southern AK natural gas reservoirs and wells are shut in for lack of market, transportation, and conversion to liquids capacity.
Loving that chart and looking for it to go higher.
P/E ~ 8, and P/Book under 2.
Looks like anything around $58-$60 = time to buy.
You jump in whenever you like. It's your web site as much as anyone elses. This whole LNG terminal issue is becoming a hot issue of lately. No one wants such terminals in their ports. Much like no one wants oil refineries in their cities/towns/municipalities. We all want low cost oil and gas based fuels but no one wants the industrial facilities around their backyards. Much like no one moving into developments on large tracks of sold farmland want the poor farmers to use natural fertilizers such as manure, because it stinks up their nice new neighborhoods. Draw your own conclusions.
geez, i think i'll dump my apple and google and be right over
Oh thanks! You just had to do that, didn't you! :0(
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