Conoco closes on west NS purchase
ConocoPhillips said June 4 that it has obtained approvals for the acquisition of Anadarko Petroleum Corp.’s 22 percent lease interests in the western North Slope of Alaska.
ConocoPhillips announced the acquisition Feb. 1, saying at that time that it had signed a definitive agreement with Anadarko for that company’s 22 percent nonoperated interest in the western North Slope of Alaska, as well as Anadarko’s interest in the Alpine pipeline, for $400 million in cash, “before customary adjustments,” and subject to regulatory approval. The transaction had an effective date of Oct. 1, 2017.
In addition to producing assets, ConocoPhillips’ interest in exploration and development lands, including the Willow discovery, totaled some 1.2 million acres, a combination of state and federal acreage.
In the company’s transcript of a Feb. 1 analysts’ call, ConocoPhillips executive vice president of production, drilling and projects, Al Hirshberg, said of the acreage acquisition, “We now own 100 percent of these assets containing about 200 million barrels of gross reserves and about 900 million barrels of risked gross resource, with gross production of about 63,000 barrels per day in 2017.”
Hirshberg described the acquisition from Anadarko as “an opportunistic bolt-on opportunity.”
ConocoPhillips Chairman and CEO Ryan Lance said in the Feb. 1 call that Anadarko had “expressed a desire to sell some assets, and Alpine was one of those. I think we’re the natural buyer because we operate and we have the majority interest in the area.” Lance also said it made a lot of sense for ConocoPhillips “to pick up that interest and be in complete control … of the capital pace and destiny over there.”
In its June 4 press release ConocoPhillips said in the first quarter of 2018 the production associated with the acquired 22 percent lease interests was 11,000 barrels of oil equivalent per day. The company currently has western North Slope production from the Colville River unit, with production expected to begin from Greater Mooses Tooth in NPR-A by the end of the year.
The Alaska Department of Natural Resources’ May monthly lease administration activity report reflects the transfer of acreage from Anadarko to ConocoPhillips Alaska, with an effective date of March 1. Anadarko currently has no state lease acreage in Alaska.
The federal Bureau of Land Management, which leases in the National Petroleum Reserve-Alaska, shows no current leases for Anadarko in a list of NPR-A acreage dated May 17.
ConocoPhillips Alaska and Anadarko had partnered in both state and NPR-A acreage.
- KRISTEN NELSON