Conoco wants to start work this winter on $8 billion North Slope project

A top official with ConocoPhillips said the company expects to start working early next year on the $8 billion Willow oil prospect in Alaska, an effort that could lead to more than 2,000 construction jobs in the coming years.

The project is located in the 23-million-acre National Petroleum Reserve-Alaska on the North Slope. The reserve is home to migratory birds, polar bears and calving grounds for the Teshekpuk Lake caribou herd.

Willow could potentially produce 600 million barrels of oil over a 30-year life, according to estimates. Peak production could reach 180,000 barrels a day, according to the company. Total Alaska North Slope oil production is less than 500,000 barrels a day, down 75% from its peak in the late 1980s.

Nick Olds, executive vice president of global operations for ConocoPhillips, said on a Nov. 10 earnings call that the company expects federal approval for the project by year’s end. The Bureau of Land Management is in the final stages of preparing a supplemental environmental impact statement for the project, following a court order that found the original EIS was deficient.

Following a decision by the federal government allowing the project to proceed, the company early next year expects to make a final investment decision before major construction begins on the project, Olds said.

However, Conoco expects some early work at Willow this winter, such as opening up a gravel mine site and laying some gravel roads, he said.

Olds said ConocoPhillips supports the development plan presented in the BLM’s draft supplemental environmental review earlier this year. That new plan would reduce the company’s originally proposed footprint to three large gravel pads on the tundra to support drill rigs, down from five in an earlier proposal.

The new EIS and development plan follows a ruling by federal Anchorage District Court Judge Sharon Gleason that tossed the agency’s earlier approval for development, after conservation groups sued to halt the project, arguing that the agency had underestimated the plan’s harm to wildlife, including polar bears, among other errors.

The downsized project remains a good value against other projects, even with inflation high, Olds said. “Despite all the cost pressures, the project remains very competitive in our cost-supply framework,” he said.