ConocoPhillips Ups Stakes in Major Alaska Fields with Chevron Acquisitions

Chevron Corp. has agreed to sell minority stakes in two of the biggest oilfields in the United States, Alaska’s Kuparuk and Prudhoe Bay, to co-venturer ConocoPhillips for about $300 million.

“When the transaction closes, ConocoPhillips Alaska’s working interest will increase approximately 5 percent to a range of 94-99 percent in the Kuparuk River Unit, inclusive of satellite fields, and will increase 0.4 percent to approximately 36.5 percent in the Prudhoe Bay Unit”, the Alaska arm of Houston, Texas-based ConocoPhillips said in a statement. “The transaction is expected to add an estimated 5,000 net barrels of oil equivalent per day to the company’s portfolio going forward”.

ConocoPhillips is the operator of the Kuparuk River Unit and the four Kuparuk satellite fields, which together form the Greater Kuparuk Area. The area contributed 66 million barrels of oil equivalent a day (MMboed) net to ConocoPhillips’ production in 2022, of which 47 MMboed came from the Kuparuk River Unit, according to a fact sheet published by the company May 2023.

Besides Chevron, the other partner in the Greater Kuparuk Area is Exxon Mobil Corp. Before the sale to ConocoPhillips, expected to close by the end of 2024, Chevron holds 4.9 percent stakes in the Kuparuk River Unit and the Kuparuk satellites, based on the 2023 fact sheet. ExxonMobil owns 0.6 percent in the Kuparuk River Unit and 0.2 to 5.8 percent in the Kuparuk satellites.

In the Greater Prudhoe Area, which encompasses the Prudhoe Bay field, the Prudhoe Bay satellite fields and the Greater Point McIntyre Area fields, ConocoPhillips will become the majority owner after the completion of the transaction with Chevron. ConocoPhillips would overtake ExxonMobil (36.4 percent), based on the 2023 information from ConocoPhillips. As it stands, Chevron has a 1.1 percent. Operator Hilcorp owns 26.4 percent.

Greater Prudhoe accounted for 90 MMboed of ConocoPhillips’ net output in 2022, 70 MMboed of which came from Prudhoe Bay.

“This transaction once again demonstrates our investment in the state”, ConocoPhillips Alaska president Erec Isaacson said of the agreement with Chevron. “In the first half of 2024, our investments in Alaska projects have exceeded $1.4 billion, underscoring our sustained commitment to Alaska for more than 50 years”.

Recently ConocoPhillips delivered a single production module to drillsite 3T of the Nuna project in the Kuparuk River Unit. “This is the first sea-lifted production module fabricated in Alaska for the company in more than two decades”, it said in a separate statement.

“Nuna is projected to boost Kuparuk’s production in the coming years, reaching a peak rate of 20,000 net barrels of oil equivalent per day”, ConocoPhillips added.

3T is Kuparuk’s 49th drillsite. It will have 29 development wells tied back to existing facilities under the Nuna project.

Isaacson said, “Kuparuk has played a vital role in our company's success, contributing significant production for more than 40 years”.

“It's remarkable to witness new developments like the Nuna project showcasing that this asset remains robust and continues to provide considerable value to our North Slope operations”, Isaacson added.

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