ConocoPhillips is picking up another potential oil development on the western North Slope, reaching an agreement with a small, private company that is selling off much of its assets in Alaska.
ConocoPhillips today announced it intends to buy 21,000 acres from Caelus Natural Resources, which includes the Nuna oil discovery.
ConocoPhillips is the biggest player west of Prudhoe Bay, and the oil company has several other major projects in the works.
Nuna is near the Kuparuk oil field, which ConocoPhillips operates. ConocoPhillips can use infrastructure from Kuparuk to develop the field.
“That’s why it makes a lot of sense,” said ConocoPhillips spokesperson Natalie Lowman.
Lowman declined to disclose the terms of the deal. It is contingent on approval by the Alaska Department of Natural Resources.
Caelus had delayed Nuna’s development. In 2014, its CEO told the Alaska Journal of Commerce that he expected oil to begin flowing in 2016.
But the Texas-based Caelus ran into challenges when oil prices plunged. Caelus held off more exploratory drilling at the large offshore oil discovery it announced in 2016, called Smith Bay, partially blaming uncertainty related to the state’s now-eliminated oil tax credit program. According to Caelus Senior Vice President Pat Foley, the company is still trying to secure financing for Smith Bay.
Earlier this year, Caelus also agreed to sell its interest in the Oooguruk oil field to Italian oil company Eni.
State documents show Nuna previously was estimated to contain between 75 and 100 million barrels of oil. But ConocoPhillips said it will spend the next few years doing its own appraisal of the field before it decides to move forward with the project.