Alaska’s oil industry recovering
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The backbone of Alaska’s economy - crude oil - is finally on the mend. Operators in the state appear to have adjusted to an average oil price of $50 per barrel, moving ahead with exploration and production projects.
The only exception might be BP; my solid but unofficial sources say the company is still over-staffed and expect to see more layoffs in the year ahead.
In August 2016 a total of three, sometimes four, rigs were working in Alaska. This past August there were three, sometimes four, rigs working in Cook Inlet alone, and the same number on the North Slope: And that’s prior to the North Slope exploration season.
This coming winter promises to be the busiest oil exploration season on the North Slope in several years.
This is what the coming winter exploration on the North Slope looks like right now:
• Glacier Oil & Gas (Savant) is drilling a well on its leases near Badami, exploring a formation behind a fault block that hasn’t been drilled before, and using Nabors Rig 27E. That’s the same rig ExxonMobil used at Point Thompson. 1 rig.
• ConocoPhillips is planning four to five exploration wells west of the Colville River (see full story this issue). 3 additional rigs.
• Armstrong, per company President Bill Armstrong, two Pikka appraisal wells, including one side track. 1 rig.
There had been consideration by Alliance to drill an exploration well in its new Guitar this winter unit but our sources say that has been pushed back a year to 2019.
Given the state’s primary economic engine is the oil industry, several service and supply contractors have already seen increased activity this year, and expect to see even more in 2018.
Finally, some good news.
Here’s to hoping the economic pundits that have predicted a gradual strengthening in world oil prices starting in mid-2018 are right.
- KAY CASHMAN, publisher & executive editor
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