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No Alaska exploratory wells in 2011, company says

Posted: Friday, November 19, 2010

FAIRBANKS - ConocoPhillips Alaska has no plans to drill any exploratory wells in the state in 2011.

The president of the oil company, Trond-Erik Johansen, made the announcement Wednesday at the Resource Development Council convention in Anchorage, The Fairbanks Daily News-Miner reported.

ConocoPhillips and BP announced one year ago at the same event that they would trim development budgets for 2010 on the Alaska North Slope.

Johansen said his company sees potential in offshore drilling and viscous and heavy oil production. But he said Alaska's investment climate, taxes and maintenance troubles on the trans-Alaska oil pipeline present challenges to development.

"We have some work to do to make sure we ensure we keep oil flowing through the pipeline," he said.

BP Exploration, Alaska, will hold to the same budget this year as last year, president John Minge said Thursday.

Spending around $800 million on capital, for things like safety programs and new infrastructure, and $1.3 billion for operations would halt a slide in capital investment.

Minge said capital spending had shrunk 20 percent this year from 2009.

He said BP also sees long-term potential in hard-to-develop viscous and heavy oil resources. The company this year wrapped up a $100 million heavy oil pilot project at Milne Point.



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