ConocoPhillips Starts Alaska GMT1 Output Ahead of Schedule

ConocoPhillips ' COP unit in Alaska recently scored a significant touchdown with the commencement of production at the Greater Mooses Tooth 1 (GMT1) prospect in the National Petroleum Reserve of Alaska. The prospect is located at the western edge of the existing Arctic Alaska oil development.

The project in the Alaska North Slope began around two months ahead of its scheduled date. The prospect's peak production is expected in the range of 25-30 thousand barrels of oil per day (MBbls/d). Including construction and drilling expenses, the project's cost is estimated at $725 million.

The GMT1 prospect boasts a drilling pad of 11.8 acres, which will start with nine wells. The pad has a capacity to contain up to 33 wells. The prospect, having a 7.6-mile road and pipeline facilities, is connected to the Colville River Unit infrastructure. Oil from the site, after processing, reaches the Trans Alaska Pipeline System to head south. The project led to the creation of 700 jobs during peak construction.

Future in Alaska

The company is currently waiting for several permits, gaining which will enable it to develop a second drill site in the Greater Mooses Tooth Unit (GMT2), located around eight miles southwest of GMT1. Construction works for GMT2 are expected to start early-2019 and production will likely commence by 2021. Peak production from the site, which is a satellite of the Alpine Oil Field, is expected to reach 35-40 MBbls/d. The project cost is estimated to be more than $1 billion.

Houston, TX-based ConocoPhillips is one of the largest exploration and production companies in the world, and the largest producer in Alaska. Notably, over the next decade, it intends to increase its total North Slope output by 100,000 barrels per day. This year, the company discovered around 750 million barrels of oil and gas resources in the National Petroleum Reserve in the North Slope.

Price Performance

ConocoPhillips has gained 50.8% in the past year compared with 39% collective growth of its industry .

Zacks Rank and Other Stocks to Consider

ConocoPhillips currently carries a Zacks Rank #2 (Buy). Other top-ranked players in the oil and gas sector include Petroleo Brasileiro S.A. PBR or Petrobras, Shell Midstream Partners, L.P. SHLX and Chevron Corporation CVX , each flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

Petrobras is the largest integrated energy firm in Brazil and one of the major players in Latin America. It pulled off an average positive earnings surprise of 10.4% in the last four quarters.

Shell Midstream Partners is involved in owning, operating, developing and acquiring pipelines, and other midstream assets. The partnership delivered an average positive earnings surprise of 7.9% in the trailing four quarters.

Chevron is an integrated energy company based in San Ramon, CA. The company's top line for 2018 is expected to grow 17.7% year over year.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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