Pioneer budgeting $135M for Alaska

Pioneer Natural Resources is budgeting $135 million for Alaska in 2012, as compared to about $100 million in 2011.

The Texas-based independent plans to spend $2.5 billion, largely dedicated toward ongoing activities in its home state. That includes $1.5 billion for work in the Spraberry field, $275 million in the Wolfcamp shale, $215 million for the Barnett shale, $130 million for the Eagle Ford shale and $220 million for other activities in its portfolio.

At its nearshore Oooguruk unit on the North Slope of Alaska, Pioneer will continue to operate one rig to drill development wells targeting the Kuparuk, Nuiqsut and Torok intervals, but the company has also contracted a second rig to drill two exploration wells this winter on acreage at Oooguruk that cannot be reached from that artificial island.

The first well will test a discovery in the Torok made last year, while the second will test the deeper Ivishak with the potential to hold between 100 million and 200 million barrels, according to the company. The offshore Sikumi No. 1 would be a vertical well starting some two miles southwest of Oooguruk Island while the onshore Nuna No. 1 is a directional well some 2.5 miles northwest of Kuparuk River unit drill site 3S.

Pioneer recently began drilling the first of those wells.

Oooguruk production continues to flag year-on-year. Pioneer produced 4,000 net barrels of oil equivalent per day in Alaska in the fourth quarter of 2011, down from 6,000 boe per day in 2010. Companywide, Pioneer produced 137,000 boe per day in the fourth quarter of the year, up from 106,000 boe per day during the last three months of 2010.

Pioneer also received $7 million in Petroleum Production Tax Credits in the quarter.

—Eric Lidji