ConocoPhillips to boost '04 spending

Posted: Thursday, December 18, 2003

ANCHORAGE Conoco Phillips plans to spend $600 million for oil and gas exploration and other capital projects in Alaska next year, up 11 percent over this year.

Most of the money will be used to fund its Prudhoe Bay, Kuparuk and western North Slope operations. Some will be used to cover tanker-ship construction costs, the company said.

Conoco, the state's largest oil and gas producer, plans to drill four North Slope exploration wells in 2004, said comapny spokesperson Dawn Patience. She declined to give specifics.

Much of Conoco's exploratory drilling in recent years has been in the National Petroleum Reserve-Alaska, an area roughly the size of Indiana west of the North Slope oil fields.

Among areas currently being explored, NPR-A is considered the state's best prospect for significant new oil discoveries.

Conoco hasn't announced what its drillers have found in NPR-A.

In 2003, Conoco drilled three exploration wells on the North Slope, and one sidetrack, or horizontal offshoot, of an old well on the Kenai Peninsula, Patience said.

Executives last January said they intended to spend $640 million in the state this year on capital projects, and planned to drill four to six exploratory wells. Patience said the company ended up spending about $100 million less.

She said there were two main reasons spending was lower than expected. The company didn't have to pay as much for the tanker construction this year as originally thought, Patience said.

Second, the company was unable to finish some planned projects at Kuparuk and Prudhoe Bay.

Conoco owns an interest in most of the North Slope oil fields and runs Kuparuk and Alpine, the Slope's second and third most productive fields.

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