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Vol. 25, No.24 Week of June 14, 2020
Providing coverage of Alaska and northern Canada's oil and gas industry

Oil patch insider: Conoco nets zero workplace C19 cases; Hilcorp revenue hits $3.99B

Kay Cashman

Petroleum News

In a June 9 CERA Week interview with Daniel Yergin, ConocoPhillips Chairman and CEO Ryan Lance said the company has had only 13 cases of COVID-19 reported from its operations worldwide, none of which were traced back to the workplace.

Lance told Yergin, vice chairman of IHS Markit, that having an office in China helped the company get a “jumpstart” on establishing protocols.

“In China we have a large operation in Bohai Bay that is offshore. In working with our partner, CNOOC, (we) came up with a protocol that said there was about a 14-day incubation period for the virus, send people offshore and have them work for 14 days and then the next group coming in would have to self-quarantine and isolate for 14 days.

“It really helped us work through the operational protocol that then was applied to the North Slope of Alaska where we had 4,000 workers, and to our offshore operations in Norway and elsewhere around the whole world.”

ConocoPhillips China Inc. is a wholly owned subsidiary of Houston-based ConocoPhillips.

Lance also said ConocoPhillips was able to weather the COVID-19 crisis without layoffs.

“Our China office is back to full capacity as of a week ago,” he said, noting other ConocoPhillips locations were also progressing back to full operations, such as Bartlesville, Oklahoma, where the company is going into Phase 2, with half the employees working in the office at a time.


Fortune releases stats on Hilcorp

Founded in 1989, Houston-based Hilcorp is a privately owned company and therefore not a lot is publicly known about its finances, although its production performance in the oil and gas fields in which it operates is well-documented in state and federal public records. (In addition to Alaska, which it entered in 2012, Hilcorp operates in Alabama, Colorado, Louisiana, New Mexico, Ohio, Pennsylvania, Texas and Wyoming.)

Because Hilcorp’s has been on Fortune magazine’s list of the Top 100 Great Places to Work for the last seven years (No. 70 in 202) its annual revenues are published by Fortune.

Hilcorp’s 2019 revenue was $3.99 billion, as compared to the two other most active North Slope explorers - ConocoPhillips’ 2019 revenue was $36.67 billion and Oil Search’s $1.59 billion. All three companies are independents.

Other interesting Hilcorp stats released by Fortune include:

* 93% of its 2,336 employees voted Hilcorp was a great place to work.

* 32% of employees are millennials, 42% Gen. X, and 26% baby boomers.

* 42% have been with the company for 2 years, 26% for 2-5 years, 20% for 6-10 years, 8% for 11-15 years, 3% for 16-20 years, and 1% for more than 20 years - a tribute to steady growth.

* Perks of the job include on-site fitness/subsidized gym, on-site medical care facility and health insurance for part-timers.

Fortune’s review said Hilcorp “challenges its employees to think in terms of Big Hairy Audacious Goals,” which are the “lofty performance goals it sets every five years.”

To meet these goals, Hilcorp “CEO Greg Lalicker believes total transparency is a must, from frontline employees to the CFO. All financials, cash flow, investments, oil and gas price impacts, BHAG progress reports, and other critical information are shared in monthly, companywide lifting cost meetings,” Fortune wrote.

“It blows your mind to be in your first lifting-cost meeting and hear super-secret information,” one new hire was quoted as saying.


AOGA 2020 conference cancelled

After “careful consideration of the ongoing coronavirus (COVID-19) situation, its impact on the oil and gas industry, and with the health and safety of all participants in mind, we have decided not to hold this year’s AOGA Conference,” the association’s President and CEO Kara Moriarty said in a June 3 press release, asking people to save June 3, 2021, in Anchorage for the next conference.

All registration fees will be refunded or rolled over to the 2021 conference.

In closing, Moriarty said the single most critical policy issue facing Alaska’s oil and gas industry today is Ballot Measure 1, an oil tax ballot measure that “would have a drastic impact hindering Alaska’s economic recovery. While AOGA intends to face this head-on, we can’t do it alone.”

She invited people to join the OneAlaska campaign at and “VOTE NO on this misguided ballot measure to ensure a positive economic future for our great state.”


White House memo on U.S. Arctic interests

A Memorandum on Safeguarding U.S. National Interests in the Arctic and Antarctic Regions was released by the White House June 10. The memorandum calls for assets and resources in the Arctic to ensure a persistent U.S. presence in the area, including a fleet of polar security icebreakers that is operationally tested and fully deployable by Fiscal Year 2029.

“We are an Arctic nation because of Alaska, and I’m grateful that both my colleagues in Congress and the White House appreciate the strategic importance of the Arctic to our national security,” U.S. Sen. Dan Sullivan, R-Alaska said in response to the memo.

“At long last, the federal government has woken up to the fact that the Arctic is a region of great strategic competition. Unfortunately, our adversaries are well ahead of the United States when it comes to Arctic infrastructure. We have one heavy and one medium functioning Polar-class icebreakers, while Russia has more than 50.”

Read the full memorandum here:

Drones continue to gain in popularity

According to a recent report in the Houston Business Journal, the Railroad Commission of Texas, which regulates that state’s oil and gas industry, has launched a fleet of eight drones that allow RRC inspectors to immediately monitor industry emergency situations.

As part of the new program, 19 agency inspectors received remote pilot certification from the Federal Aviation Administration. The drones are equipped with thermal cameras and one was used to detect a leak at an oil well in the Permian Basin's Reeves County, HBJ reported.

More recently, Scout Drone Inspection of Trondheim, Norway, and DNV GL of Hovik, Norway, have completed a successful test inspection of a 64-foot high oil tank on board a floating production, storage and offloading vessel, the companies said in a June 9 release.

Altera Infrastructure hosted the test on Petrojarl Varg as part of its drive to improve safety and efficiency through innovative technology, the companies said. The video was live streamed from the North Sea port of Skipavik-Gulen, via Scout’s cloud-system back to Altera’s headquarters in Trondheim, where the footage was monitored by engineers. The video was interpreted in real-time by an algorithm to detect cracks in the structure.

The tanks are tough work environments, with surveyors often having to climb or raft into hard to reach corners. Costs can run into hundreds of thousands of dollars as the tank is taken out of service for days to ventilate and construct scaffolding.

Closer to home, the Alaska Center for Unmanned Aircraft Systems Integration at the University of Alaska Fairbanks is making strides for oil industry use of drones in Alaska.

The center flew the country’s first FAA-approved true beyond-visual-line-of-sight, BVLOS, domestic flight of an unmanned aircraft system along the trans-Alaska oil pipeline corridor last July near the Chatanika River on the Elliott Highway.

The flights were a part of the Unmanned Aircraft Systems Integration Pilot Program, a national initiative from the U.S. Department of Transportation and the White House.


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