COP: North Slope At Risk -- Killing The Golden Goose -- October 29, 2020

I do not have a dog in this fight. Gut check for Alaska. I believe the pipeline is running about 450,000 bopd and apparently the pipeline runs the risk of failing if production drops below 400K or thereabouts. I haven't checked the data in a long time. I could be way wrong.

Link at SeekingAlpha.

This could be great news for the Bakken and the Lower 48. If Alaska votes to approve a new tax on oil production, COP says it will stop drilling on the North Slope. 

How big a deal is that threat?

Look at the numbers:

The North Slope generated one-fourth of COP's worldwide crude production:

• three fields
• 218K boepd in 2019

Ballot Initiative 1, if passed:

• COP says it would not resume normal production of its Alpine, Prudhoe, and Kuparuk fields in 2021 or beyond that
• would tax fields with lifetime production of at least 400 million bbls of crude oil and at least 40K bbl/day in the preceding calendar year

Over at Argus Media:

• excluding Libya, COP produces around 1 million boepd
• production in the Lower 48: averaged 309,000 boepd
• Eagle Ford: 167K boepd
• Bakken: 75K boepd
• Permian: 67K boepd
• COP recently acquired Concho (the Permian)

Concho: about 200,000 bopd which would offset loss of Alaska production.

COP 3Q20 earnings: $500 million loss vs a profit of $3.1 billion during same period in 2019.

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