ConocoPhillips reported earnings of $65 million in Alaska in the third quarter of 2016 compared to a $826 million loss globally, according to a report of financial performance filed with federal securities regulators Thursday.
With oil and gas prices mired in a long-term slump, the Houston-based oil company also reported adjusted quarterly income on its operations in Asia Pacific and the Middle East, taking in $87 million, and in Europe and North Africa of $3 million.
Those provinces were the bright spots in another difficult quarter for ConocoPhillips and the oil industry overall.
ConocoPhillips, Alaska's leading oil producer, lost $403 million in the Lower 48, $284 million in Canada and $47 million in other areas across the globe compared to its profit in Alaska, adjusted earnings show.
Despite the price slump, the company is still paying millions of dollars in taxes and royalties to the state, said Natalie Lowman, communications director for ConocoPhillips Alaska.
During the quarter, ConocoPhillips incurred obligations of $113 million in taxes and royalties to Alaska, she said. Year-to-date taxes and royalties due to Alaska is estimated at $321 million.
The company also continues to spend heavily in Alaska to pursue new fields while increasing oil produced from legacy fields such as at the company's large Kuparuk River unit, she said.
In the first nine months of the year, ConocoPhillips made $117 million in Alaska, adjusted earnings show.
The company during that period still has a negative cash position — at minus $10 million — after capital spending of $702 million in Alaska is factored in, said Lowman.
One positive announcement for deficit-ridden Alaska came on Thursday when ConocoPhillips officials, in an earnings call with financial analysts, said a $460 million project to produce viscous oil is moving ahead.
The company has said peak production at the project, called 1H NEWS and located in the Kuparuk River unit west of Prudhoe Bay, is expected to reach 8,000 barrels daily.
"We're looking at first oil in 2018," said Lowman.
Despite the hard times globally, ConocoPhillips' overall quarterly losses were less than expected. Worldwide, the company is reducing expenses and boosting production, conditions that helped the company's beaten-down stock leap higher on Thursday. It was up $2.20 to $44.00.
ConocoPhillips is the only oil company to break out its quarterly performance in Alaska, where a large share of its oil is produced. In a big move in the past year, it has expanded oil production into new territory in the National Petroleum Reserve-Alaska, on the western edge of the North Slope oil fields.
In the quarterly report to the U.S. Securities and Exchange Commission, the company highlighted accomplishments at the new field, built on Native corporation land within the boundaries of the giant federal reserve.
"An Alaskan state drilling depth record was achieved at CD5, which continues to perform well," the company said, referring to a well that extended 5 miles and daily oil production of 20,000 barrels that topped estimates of 16,000 barrels.
Helping boost adjusted earnings were federal enhanced oil recovery tax credits, Lowman said. They are available if oil prices are below $52 a barrel and special steps are taken to produce oil, such as injecting fluids underground to pressurize reservoirs, helping to keep oil flowing.
Monthly averages for North Slope crude prices for 2016 peaked at $47.40 in July, state figures show.
The company's daily oil production in Alaska is up 4 percent for the first nine months of 2016 — compared to the same period a year earlier — averaging 160,000 barrels.
The $900 million Greater Mooses Tooth 1 project in the NPRA will also see a "big construction season this winter," creating about 650 jobs for construction. That project was also cited in the call with investors.
ConocoPhillips plans to bring Greater Mooses Tooth 1 into production in late 2018, with an estimated peak of 30,000 barrels of oil daily.
"We're still continuing to invest aggressively," Lowman said.