ConocoPhillips approves $900 million Arctic reserve project

ANCHORAGE — ConocoPhillips has approved funding for a $900 million drilling project on Alaska’s North Slope.

When production begins in 2018 at the filed in the National Petroleum Reserve-Alaska — an Indiana-sized Arctic reserve — the project is expected to yield 30,000 barrels of oil daily at its peak, the Alaska Dispatch News reported.

Production would be the first time oil has flowed from federal lands on the reserve. The Bureau of Land Management oversees the reserve and is working on a broad management plan in the area.

“We are pleased to have been able to work through key permitting issues with the Corps of Engineers and BLM that now allows us to move into the development phase,” said Joe Marushack, president of ConocoPhillips Alaska.

The BLM permitted the project last month, after the U.S. Army Corps of Engineers approved a federal wetlands permit in January.

The project will require a new gravel pad, a road, facilities and pipelines. Plans call for nine wells initially and up to 33 wells, with oil processing at the existing Alpine Central Facility.

Construction is slated for early 2017, with peak winter-season hiring estimated at about 700, according to a company statement.

The project will receive a tax incentive through the “new oil” portion of the state’s tax regime passed in 2013. State Revenue Department spokesman Ken Alper said if oil prices remain low when production begins, the project’s tax rate could drop to zero because the minimum tax wouldn’t apply.

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