ConocoPhillips is set to develop its Nuna field project in Alaska and expects a peak oil rate of 20,000 barrels per day from the site, the company said in a news release.
Construction will begin this year at ConocoPhillips’ 3T drill site at its Kuparuk River Unit and continue in 2024 with pipeline and on-pad construction, the company said. Drilling is forecast to begin in late 2024 and ConocoPhillips expects first oil by early 2025.
ConocoPhillips said it acquired the Nuna acreage in 2019 from Caelus, which had already constructed the gravel road and pad for the drill site.
The Nuna project will add 29 development wells, on-pad infrastructure, and pipelines that will connect to existing Kuparak processing facilities, the company said.
“The additional drilling opportunities we’ve identified at Nuna are a positive development that should increase oil production at Kuparuk,” said ConocoPhillips Alaska President Erec Isaacson said.
“Our investment in this project was approved due to Alaska’s stable fiscal regime which is clearly working to promote new and ongoing investment,” he said.
According to the news release, ConocoPhillips Alaska plans to continue an investment of about $1 billion a year to expand its “legacy business with projects such as Nuna”.
First Quarter Results
In May, ConocoPhillips posted first-quarter 2023 earnings and adjusted earnings of $2.9 billion, or $2.38 per share, from January-March 2022 earnings of $5.8 billion, or $4.39 per share, and adjusted earnings of $4.3 billion, or $3.27 per share, in the 2022 first quarter. Earnings decreased from the first quarter of 2022 primarily due to lower realized prices partially offset by commercial performance and timing, the company said in a separate earnings release.
According to the release, the company delivered a record output of 1.792 million barrels of oil equivalent (MMboed) in the first quarter, an increase of 0.045 MMboe from the same period a year ago. After adjusting for impacts from closed acquisitions and dispositions, first-quarter 2023 production increased four percent from the same period a year ago, the company said.
In the Lower 48, which refers to the 48 contiguous USA states excluding Alaska and Hawaii, first-quarter production averaged 1.036 MMboed, including 0.694 MMboed from the Permian, 0.227 MMboed from the Eagle Ford and 0.098 MMboed from the Bakken, according to the release. ConocoPhillips said that a stabilizer expansion in the Eagle Ford and a planned turnaround at QatarGas 3 were successfully completed.
The increase in production was primarily driven by new wells online in the Lower 48, and improved well performance across the portfolio, partially offset by normal field decline and downtime, the company said.
“Our first quarter results are a clear demonstration of the durable, returns-focused value proposition that we laid out at our recent analyst and investor meeting”, said ConocoPhillips Chairman and CEO Ryan Lance.
The company’s Alaska unit reported a net income of $416 million in the first quarter of 2023, according to a separate news release.
Earlier in the year, the Biden administration approved ConocoPhillips’ controversial Willow project on Alaska’s North Slope, a sign that governments are struggling to balance energy security and clean energy objectives, according to Rystad Energy Vice President Radhika Bansal. ConocoPhillips said that the Willow project is estimated to produce 180,000 barrels of oil per day at its peak and is projected to deliver between $8 billion and $17 billion in new revenue for the federal government, the state of Alaska and North Slope Borough communities.
According to the company website, ConocoPhillips is Alaska’s largest crude oil producer and the largest owner of exploration leases, with approximately 1.2 million net undeveloped acres as of 2022. The company has major ownership interests in two of North America’s largest legacy conventional oil fields: Kuparuk and Prudhoe Bay, both located on Alaska’s North Slope. ConocoPhillips also operates several fields on the Western North Slope.
