The cautious feeling to winter exploration season: fluctuating oil prices and high costs of materials and labor cause concern.

• Author: Bradner, Mike
• Position: OIL & GAS

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There is a certain unease about the 2008-2009 winter exploration season on Alaska's North Slope. By all appearances, a modest exploration season is shaping up, much like last year's. But an uncertain economic climate caused by rising costs, heavy state taxes, and volatile oil markets, as well as unease over the global economy is creating an environment of uncertainty in which decisions on the upcoming winter program are being made.

There are big North Slope projects in the works for this winter, however. ExxonMobil's plan to drill at the big Point Thomson gas and liquid condensate field east of Prudhoe Bay is the most robust new project on the horizon. BP Exploration (Alaska) Inc. will also begin work at the Endicott field for development of Liberty, an offshore field that BP will put into production with wells drilled from Endicott, a few miles west of Liberty.

Eni Oil and Gas also has started development at its Nikaitchuq project, an offshore discovery in shallow waters just north of the Kuparuk field. Nikaitchuq is similar to the Oooguruk offshore field located a few miles to the west, which was brought into production earlier this year by its owner Pioneer Natural Resources Inc.

These are development projects, however, aimed at producing oil and gas resources that were discovered in the 1970s and 1980s into production.

In terms of pure exploration, ConocoPhillips and its partner, Anadarko Petroleum, plan to drill two exploration wells in the northeast National Petroleum Reserve-Alaska, although the projects won't be confirmed until ConocoPhillips' board approves the company's annual capital budget later this year. The new wells will continue a steady program ConocoPhillips and Anadarko have had for several years in NPR-A. The new wells will be drilled in the "Moose's Tooth" area of the northeast part of the reserve, near where modest oil and gas discoveries have been made previously.

Anadarko Petroleum, BG and PetroCanada will continue exploration in the Brooks Range foothills southwest of Prudhoe Bay. The companies will finish one well started last year and drill a new well near Gubik, a gas discovery made in the 1960s, which was drilled and tested last year. Arctic Slope Regional Corp. of Barrow owns the lands being tested, but there are also State lands in the area. The companies will also drill a well in the National Petroleum Reserve-Alaska.

In the same region, Renaissance Umiat, an independent company, is evaluating prospects for drilling and developing oil near...