DNR Approves ConocoPhillips Lease Extension, Defers Colville River Unit Contraction

The Alaska Department of Natural Resources’ Division of Oil and Gas has approved ConocoPhillips Alaska Inc.’s application to extend leases tied to Fiord West and to defer contraction of the Colville River Unit, notifying the company by certified mail. The approval letter was addressed to Jason Parker at ConocoPhillips and signed by Division Director Derek Nottingham; the documents cite a Feb. 12 notification and a Nov. 26 filing, but those excerpts do not include years.

The approval ties back to an original Fiord West agreement decision dated Sept. 14, 2015 and four subsequent amendments referenced in the administrative record. The Colville River Unit includes the Alpine Field and nearby satellite fields, administered by ConocoPhillips Alaska, with Alpine serving as the central production facility that separates oil, gas and water and processes satellite production through its facilities.

ConocoPhillips filed a formal expansion application on Apr. 25, 2018 covering approximately 412.27 acres in State lease Umiat Meridian, T.10 N., R.4 E., Sec.12, Lot 3; that public notice located the proposed expansion north of Nuiqsut on the Colville River and set a public comment deadline of 4:30 p.m., Alaska Time, Monday, June 11, 2018. The public notice named Kevin Pike, Unit Manager, as the Division contact for comments and listed Sean Clifton at (907) 296-8507 as the accessibility contact; the TDD number in the notice is truncated in the record.

DNR’s 2017 decision on a related “fifth expansion” emphasized drilling commitments and local-hire expectations. That release stated: “If ConocoPhillips and Arctic Slope Regional Corp. agree to the terms, DNR anticipates initial drilling will begin this winter with completion of the well by the second quarter of 2018. If drilling is successful, the decision lays out a path to development.” The release also quoted Governor Bill Walker: “To get the full benefit of the decision, at least 80 percent of the hires must be Alaskan. ConocoPhillips has a strong record of training and hiring Alaskans. Because jobs in Alaska should go to Alaskans, my team and I will continue to ensure strong local hire provisions on this and other projects.”

The Division’s Findings and Decision language reiterates the state’s retained regulatory authority. As the Findings & Decision explains: “DNR cannot modify or contract away its regulatory discretion. Exxon Corp. v. State, 40 P.3d 786, 796 (Alaska 2001). Accordingly, to the extent Conoco’s request was meant to be an assurance of deferral or a date certain regarding future contraction, it is denied. Conoco will, however, get notice and an opportunity to be heard before the Commissioner exercises discretion to contract the unit. 11 AAC 83.356(e).” The Findings & Decision for an Eighth Expansion also states the approval “takes effect immediately” and notes appeal rights under 11 AAC 02 with a 20-calendar-day filing window to the Commissioner, Andrew T. Mack.

ConocoPhillips’ broader Alaska portfolio activity accompanies the CRU action. Company statements included in the administrative record say, “Progress continues on the Willow project, which will achieve nearly 50% completion during this winter season and remains on track for first oil in early 2029. More than 2,400 jobs were filled to progress Willow critical scope in 2025, which included the construction of two bridges, installation of 72 miles of pipeline, and beginning of year-round Willow camp occupancy. We also sanctioned our Coyote major project located in the Kuparuk River unit, which will include a pad expansion, pipeline installation, and a 19-well drilling program.”

DNR documents also flag environmental and subsistence considerations for the expansion area, noting habitat for mammals, waterfowl and fish and use by residents for subsistence hunting and fishing; the Division said it develops lease stipulations through the lease sale process and considers Plan of Operations approvals to mitigate impacts. The administrative excerpts include a partially garbled reference to a lease for support operations for Doyon, but the record as provided does not supply context for that fragment.

Key procedural details remain to be clarified in the administrative docket: the exact terms and duration of the approved deferral, whether this approval authorizes immediate pad or gravel work, and the years associated with the Nov. 26 application and Feb. 12 notification are not specified in the excerpts. DNR’s Findings & Decision keeps the state’s discretion intact while the approved extension maintains Fiord West leases inside the Colville River Unit for now.