Repsol Discovers Major Oil Field in Alaska's North Slope
March 09 2017 - 6:10PM
Dow Jones News
By Bradley Olson
Spanish oil company Repsol SA said on Thursday that it had
discovered a giant oil field in Alaska, a potential find big enough
to help stem production declines in the state.
Repsol said two wells drilled this winter with Denver-based
partner Armstrong Oil & Gas, Inc. indicate that recent
discoveries in an area that lies between existing operations in the
state's North Slope could hold as much as 1.2 billion barrels of
oil.
First production from the discoveries could come as soon as
2021, with output of as much as 120,000 barrels a day, Repsol said.
That would represent a lifeline for Alaska, which has seen oil
revenues plummet after prices crashed in 2014. The state also needs
new crude to keep oil flowing on the Trans-Alaska Pipeline
System.
"We must all pull together to fill an oil pipeline that's
three-quarters empty -- and today's announcement shows measurable
results of that hard work," Alaska Gov. Bill Walker said in
response to the news of the discovery Thursday.
In October, Caelus Energy LLC, a closely held firm backed by
private-equity fund Apollo Global Management LLC, said it found as
much as 2.4 billion barrels of oil in the shallow waters of Smith
Bay, about 300 miles north of the Arctic Circle. That discovery
will require significant investment in a pipeline and other
infrastructure to develop the resource.
The Repsol discovery also requires new infrastructure, but it is
comparatively close to existing operations of other companies.
The two significant finds represent a rare achievement in oil
exploration. In recent years, the industry has found far more
natural gas, which is more costly to ship to global markets and
less commercially competitive.
Exxon Mobil Corp.'s 2015 discovery of the equivalent of more
than 1 billion barrels of oil and natural gas off the coast of
Guyana was among the largest finds in the past decade.
Write to Bradley Olson at Bradley.Olson@wsj.com
(END) Dow Jones Newswires
March 09, 2017 17:55 ET (22:55 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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