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Exxon sells Endicott field interest
to Hilcorp, following pipeline sale
Kristen Nelson Petroleum News
ExxonMobil is completing its exit from the small North Slope Duck Island unit, known as Endicott.
In June Hilcorp Alaska LLC acquired ExxonMobil Alaska Production Inc.’s interests in the Hilcorp-operated Endicott field on the North Slope, according to the Alaska Division of Oil and Gas June lease administration monthly activity report. This followed an earlier acquisition of ExxonMobil Pipeline Co.’s interest in the Endicott Pipeline Co. by Harvest Alaska LLC, Hilcorp’s pipeline subsidiary.
The pipeline transfer is before the Regulatory Commission of Alaska. Exxon’s interest in the pipeline is slightly more than 21 percent; Harvest Alaska already owns some 68.5 percent of the line, with the remaining almost 10.5 percent held by Unocal Pipeline Co.
ExxonMobil has held 31.9 percent of the Duck Island unit with Hilcorp holding 56.03 percent and Chevron USA Inc. holding 12.07 percent. ExxonMobil’s interest at Endicott was in a group of five leases in the southeast corner of the unit. The company had varied working interest ownership in the leases: 33.33 percent in one, 50 percent in two and 100 percent in two.
In May, the most recent month for which detailed data is available - from the Alaska Oil and Gas Conservation Commission - Endicott averaged 6,557 bpd, 1.3 percent of North Slope production.
Working interests On the pipeline side, Chevron is the parent company of Unocal Pipeline, so that company holds minority interests in both leases and pipeline.
ExxonMobil operates the Point Thomson unit on the eastern side of the North Slope, where it holds a 62.75 percent working interest. It holds the largest working interest, 36.4 percent, in the BP-operated Prudhoe Bay field and a small interest, 2.73 percent, in the ConocoPhillips-operated Kuparuk River field.
Hilcorp, a large Texas-based privately held independent oil and gas producer, began acquiring Cook Inlet acreage in 2011, where it is currently the largest oil and gas producer, and in 2014 it moved onto the North Slope, acquiring all of BP’s interest in Endicott, along with its interest in Northstar and a 50 percent interest in Liberty and Milne Point, along with BP’s interests in oil and gas pipelines associated with those fields.
Harvest Alaska has shown an interest in merging its North Slope facilities. It applied to RCA in 2016 to use a single connection point to the trans-Alaska oil pipeline for the Endicott and Northstar pipelines, with a joint application by the two pipelines for approval of a connection agreement and a capacity lease agreement.
The companies cited operation and maintenance efficiencies for both lines, with cost savings for pipelines and shippers.
RCA approved the connection agreement in January 2017.
- KRISTEN NELSON
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