ConocoPhillips Adding New Drill Rig To Kuparak Oil Field

ConocoPhillips announced Wednesday that they are adding another new drill rig to the Kuparak oil field on the North Slope.

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This is the second rig they’ve added this year since the new oil tax bill was signed into law. The drill rig they installed in May is producing 1,600 barrels of oil per day.

ConocoPhillips President Trod-Erik Johanson says the newest rig will start producing in January, but it’s not as easy to extract oil from the massive field as it used to be.

“The way we drill today, we could go further out on the flanks. We drill more convoluted well bores. We need more high-tech technology to go out there and do it,” Johanson said. “And, yes, it is more difficult. So, it costs a lot of money, but under the current tax system we have now, after SB21 was passed, we can make this to go around and actually make economic sense. So, that’s why I’m doing it.”

Johanson says SB 21 also motivated his company to move ahead with their projects in the Greater Moose’s Tooth Field. They are applying for permits from the Bureau of Land Management. According to the BLM, it would be the first oil and gas produced from the National Petroleum Reserve – Alaska and on federal lands in the state.

Johanson says the first step in developing NPR-A is finishing the infrastructure on Colville Delta Unit 5, which should start producing oil by late 2015. They already planned to develop that area even before the new tax plan.

If the Greater Moose’s Tooth Field is developed, it could add 30,000 barrels of oil to the pipeline per day.

Currently, oil production on the North Slope is declining by about 6% per year. Johanson spoke at the Resource Development Council conference in Anchorage.

Anne Hillman is the healthy communities editor at Alaska Public Media and a host of Hometown, Alaska. Reach her at Read more about Anne here.

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