ConocoPhillips' Appraisal Well Confirms Slagugle Oil Discovery

ConocoPhillips COP, a global exploration and production firm, has confirmed the Slagugle oil discovery in the Norwegian Sea. The company had drilled a second appraisal well, 6507/5-12 S, in production license (PL) 891, operated by ConocoPhillips. The Norwegian Offshore Directorate (“NOD”) has confirmed the discovery made by COP. The appraisal well 6507/5-12 S is located 270 kilometers to the north of Kristiansund.

The NOD stated that PL 891 was awarded in 2016 as part of Norway’s Awards in Predefined Areas. The well 6507/5-12 S is the third exploration well drilled in this license. The Slagugle oil discovery was first reported in 2020. The preliminary tests indicate that the discovery contains approximately 30.8-61.6 million barrels of oil equivalent (Mboe). The hydrocarbons are contained within Triassic reservoir rocks, with the possibility of additional volumes to be found in the lower Are Formation and the Upper Grey Beds.

The licensees in PL 891 shall thoroughly analyze the collected data and determine the possibility of developing the new oil discovery. Per the NOD, prior attempts were made to understand the size of the Slagugle discovery, which did not yield encouraging results. In 2022, the well 6507/5-11 was drilled to delineate the oil discovery. However, the well did not encounter commercially viable quantities of oil. The second appraisal well 6507/5-12 S has confirmed the presence of hydrocarbons in sandstone reservoirs of high quality.

While drilling the second appraisal well, the company conducted a formation test to understand and evaluate the reservoir quality of the oil discovery. The formation test was also intended to gain information on the connectivity between the different geological layers containing hydrocarbons. The Norwegian Directorate noted that the drilling activities yielded promising results. Notably, the well struck multiple columns of oil in a 188-metre interval, between the Are Formation and the Grey Beds. The well also recorded a maximum production rate of 650 standard cubic meters of oil per day via a nozzle opening of 36/64 inches. The well has been permanently plugged and abandoned.

The data collected during the exploration campaign is yet to be analyzed to make a decision about the development of the Slagugle discovery. However, this marks a successful campaign for ConocoPhillips as the second appraisal well encountered multiple columns of oil in sandstone reservoirs of good quality with strong flow rates.

COP’s Zacks Rank & Key Picks

COP currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the energy sector are Flotek Industries Inc. FTK, Oceaneering International OII and RPC, Inc. RES. While Flotek Industries sports a Zacks Rank #1 (Strong Buy) at present, Oceaneering International and RPC carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Flotek Industries specializes in green chemistry, which provides innovative solutions aimed at reducing the environmental impact of the energy industry. Flotek develops specialty chemicals tailored for both domestic and international energy producers, as well as oilfield service companies. These chemicals not only help reduce the environmental impact of hydrocarbon production but also lower operational costs.

Oceaneering International delivers integrated technology solutions across all stages of the offshore oilfield lifecycle. The company is a leading offshore equipment and technology solutions provider to the energy industry. OII’s proven ability to deliver innovative, integrated solutions supports ongoing client retention and new business opportunities, ensuring steady revenue growth.

RPC generates strong and stable revenues through a diverse range of oilfield services, including pressure pumping, coiled tubing and rental tools. The company is strongly committed to returning value to its shareholders through consistent dividend payments and share buybacks, making it an attractive choice for investors seeking steady returns.

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