North Slope oil production shows gradual decline, but Prudhoe Bay bucked the trend with increased output

Total slope production averaged 498,176 barrels per day in January, compared with 514,887 barrels per day in January 2020 and 525,075 barrels per day in January 2019, according to the revenue department reports.

Hilcorp increased January output at Prudhoe to 309,440 barrels per day, up from 299,380 barrels per day in the same month a year earlier, in January 2020, and 305,372 barrels per day in January 2019, when BP was field operator.

Hilcorp took over at Prudhoe on June 1, 2020 when its acquisition of BP’s Alaska upstream assets was completed. The company has a reputation for aggressive rejuvenation of mature producing fields and immediately initiated a program of repairs and rehabilitation of Prudhoe Bay wells and production facilities which seems to have paid off in stemming the field’s long-term production decline.

Hilcorp has also increased production at the Milne Point field adjacent to Prudhoe Bay, which is also operates. Those volumes are combined with the revenue department’s production report for Prudhoe, so the Prudhoe daya reflects oil from both fields.

Prudhoe is still the largest of the North Slope fields and is important because it produces more than half of the oil moving through the Trans Alaska Pipeline System.

Other fields on the slope reported year-over-year declines in January. Winter is the peak production period for the slope because processing plants operate at higher efficiency in cold temperatures. January is also the best month to do year-over-year production comparisons because field operators do scheduled plant maintenance at other times of the year and are times when facilities are taken off-line, which affects production.

The Kuparuk River field, operated by ConocoPhillips, averaged 119,509 barrels per day in January compared with 133,209 barrels per day in January 2020 and 132,287 barrels per day in January 2019. The Alpine field, also operated by ConocoPhillips, averaged 47,529 barrels per day in January compared with 59,320 barrels per day in January 2020 and 65,626 barrels per day in January 2019.

The Lisburne field, operated by Hilcorp, averaged 21,524 barrels per day in January compared with 22,977 barrels per day in January 2020 and 21,790 barrels per day in January 2019. Production from several small fields adjacent to Lisburne, such as the Endicott field, are included with Lisburne field output by the revenue department.

The long-term production forecast for the North Slope from the state Department of Natural Resources is for production to average 477,294 in the state’s Fiscal Year 2021, the budget year ending June 30, but with the fiscal year half over and stronger-than-expected performance by the North Slope producing fields particularly at Prudhoe Bay, the final average is likely to be higher.

The state has also forecast a decline to 439,587 barrels per day in state Fiscal Year 2022, which begins next June 30, but that may also prove to be conservative based on new production projects planned to be on-line next year. By 2030 the state projects slope output at 481,843 barrels per day, again assuming new projects coming on-line.

ConocoPhillips has several projects in advanced stages of development including Fiord West in the Alpine field and GMT-2 in the federally-owned National Petroleum Reserve-Alaska, which is west of the main producing fields of the slope, which are on state-owned lands.

President Joe Biden’s announced policies of slowing new oil development on federal lands would not affect projects now in construction such as GMT-2, which is expected to begin producing late this year.