ConocoPhillips (COP) has suspended its plans to drill in Alaskan Arctic waters in 2014 because of doldrums over federal regulatory and permitting standards. Earlier in Mar, Royal Dutch Shell PLC (RDS.A) announced its decision to halt exploration and drilling operations at Alaska’s Beaufort and Chukchi Seas citing the same reason.
The Artic misadventure of ConocoPhillips started in Mar when the company announced its plans to explore and drill a prospect – Devils Paw – in the Chukchi Sea. The oil major planned to employ a jackup rig built by Noble Corporation (NE).
Barring Alaskan mishaps, ConocoPhillips’ exploration initiatives toward liquids-rich plays are gaining momentum through the Eagle Ford, Bakken and North Barnett shale plays. The company is speeding up its drilling activities in the North American onshore liquids-rich plays and expects the combined yield from these plays to reach more than 200 thousand barrels of oil equivalent per day.
In contrast to misadventures of oil majors in North America, the Russian Artic is proving to be more amenable to the needs of oil majors. Already, Statoil ASA (STO) along with Russian state-owned oil company OAO Rosneft has made considerable progress in developing oil prospects in that region.
Houston, Texas-based ConocoPhillips is a major global exploration and production (E&P) company with operations and activities in 30 countries that include the U.S., Canada, UK/Norway, China, Australia, offshore Timor-Leste, Indonesia, Libya, Nigeria, Algeria, Russia and Qatar.
As of the end of 2012, the company had estimated proved reserves of 8.6 billion oil-equivalent barrels (BOE) compared with 8.4 billion BOE at year-end 2011. The company added 942 million BOE of proved organic reserves in 2012, representing a reserve replacement ratio of 156%. Including 83,000 BOE of asset sales, total reserve replacement was 142%.
ConocoPhillips carries a Zacks Rank #3, which is equivalent to a short-term Hold rating.
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