Sector News

ConocoPhillips plans to sell San Juan Basin assets

November 15, 2016

ConocoPhillips has announced it will sell off its assets in the San Juan Basin over the next two years.

The company’s corporate spokeswoman, Davy Kong, confirmed ConocoPhillips plans to sell the assets. She declined to comment further and released a written statement from the company.

The statement says the company has set a target of $5 billion to $8 billion in proceeds from asset sales.

“These will be primarily North American gas assets,” the statement reads. “We have shared further details about the marketing process with our employees. As we told them, we expect to market several assets, but will only consider offers that recognize their full value. We will not provide further specifics on an asset by asset basis.”

ConocoPhillips is the largest operator in the San Juan Basin and has about 10,000 wells in the basin, according to data provided by the corporate office in Houston, Texas.

The company has operated in the San Juan Basin for more than 50 years.

What all of that means for San Juan County is unclear, said San Juan County CEO Kim Carpenter.

“We learned yesterday that they’re going to sell off all assets,” Carptener said today. “They tried this a few years ago but didn’t get any buyers. What makes me comfortable, though, is that they said they’re going to keep things ‘business as usual’ until they get a successful bidder.”

Carpenter said the best case scenario is that if assets are sold, jobs won’t be disrupted.

“What does worry me is that if there’s a transition, what will happen with the employees?,” he said. “I hate to see jobs lost in the (San Juan) basin. Conoco has done quite a bit of layoffs, I just hope no jobs will be lost.”

ConocoPhillips employs about 500 people throughout the San Juan Basin and holds approximately 1.3 million net acres of leasehold in the area, according to information from its corporate office.

San Juan County Commissioner Scott Eckstein, who is also the mayor of Bloomfield, said it’s too early to say what the company’s move will mean for the county. But, he added, he would hate to see ConocoPhillips leave the area.

“Our relationship with ConocoPhillips has been good,” he said. “They’ve been a great partner and have supported the city of Bloomfield financially. They’ve also been very involved in the community, and would certainly be missed.”

Several other oil and gas companies, including Energen and Chevron, have also sold off assets over the past few years as a result of the downturn in the oil and gas industry.

By Leigh Black Irvin

Source: The Daily Times

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