ConocoPhillips says its drilling program in Alaska has resulted in billions of barrels of oil produced and billions more to come.
In an update of its operating plan, the company said its captured net resource is 2 billion barrels of oil equivalent at a cost of less than $40 a barrel. It’s produced more than a billion of the barrels since 2016 with 75 percent of the play still undrilled.
The company’s legacy asset base consists of a non-operated interest in the Prudhoe Bay Field, an operated interest in the Kuparuk Field and an operated interest in the Alpine Field/Western North Slope assets. In 2018, the company acquired additional interest in the Alpine Field/Western North Slope assets and announced it has entered into an agreement to acquire additional interest in the Kuparuk Field (which is subject to regulatory and other approvals). On a pro-forma basis including the recent transactions, the company estimates 2018 production from its legacy assets would be approximately 225 thousand barrels of oil equivalent per day (MBOED).
In the Greater Willow Area, the company now estimates its 2016-2018 exploration and appraisal campaign has discovered 400-750 MMBOE of gross resource, with undrilled resource upside. But it will take $2 billion to $3 billion in capital investment over the next four to five years before first oil can actually be achieved. Once first oil is produced, the company expects ramping quickly to full production.
In addition to exploration in the Greater Willow Area, the 2018 exploration campaign included the drilling, coring and flow testing of the Putu and Stony Hill wells in the Narwhal trend south of Alpine. Additional appraisal is required for both discoveries, but current discovered resource is estimated to be between 100 and 350 MMBOE gross. The company also has a 100 percent working interest in this resource.
“We believe that the company’s Alaska plan aligns with our disciplined, returns-focused strategy, supports Alaska’s economy and creates significant value for shareholders,” said Ryan Lance, chairman and chief executive officer. “Alaska provides competitive investment opportunities and will generate profitable growth from diversified investments with significant exploration upside.”