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Energy

Hilcorp acquiring Cook Inlet assets of Exxon Mobil subsidiary

  • Author: Alex DeMarban
  • Updated: September 28, 2016
  • Published July 6, 2015

Hilcorp Energy is continuing its aggressive push into Alaska's oil and gas industry, recently inking a deal to buy the Cook Inlet assets of an Exxon Mobil subsidiary.

Hilcorp, based in Houston, Texas, plans to purchase two offshore platforms from XTO Energy as well as a tank facility and offices in Nikiski on the Kenai Peninsula, said Lori Nelson, external affairs manager at Hilcorp Alaska.

The deal is part of Hilcorp's rapid growth in the state. After arriving four years ago, the company has become the dominant oil and gas producer in Cook Inlet and muscled into the North Slope oil business by acquiring two fields from BP and 50 percent of two other fields in a $1.5 billion deal.

Hilcorp expects the company's latest acquisition to be completed later this year.

"Pending all state and regulatory approval we hope to close the transaction sometime this fall," Nelson said.

The new facilities are part of XTO Energy's Middle Ground Shoal assets.

"The A and C Platforms, originally built in 1965, produce approximately 1,750 barrels of oil per day," Nelson said.

Hilcorp expects to make employment offers to all 31 employees associated with the Middle Ground Shoal facilities, she said.

Exxon Mobil acquired XTO Energy, the nation's largest holder of natural gas reserves, five years ago in a $31 billion megadeal that highlighted the oil giant's growing interest in natural gas.

XTO Energy also has a large stake in shale-oil production in the Lower 48, said Sueann Guthrie, media advisor for the firm based in Fort Worth, Texas.

She said the sale involving Hilcorp stems from XTO Energy's long-standing review of its "financial and operational objectives."

She said terms of the deal are confidential. She would not say what aspects of XTO's Cook Inlet operation did not meet the company's objectives.

XTO Energy does not produce natural gas in Cook Inlet.

Kim Jordan, public affairs coordinator for Exxon Mobil in Alaska, said in an email the transaction will not affect the Alaska LNG consortium, a proposed $50 billion project that partners Exxon Mobil with the state and other energy companies in a bid to tap North Slope natural gas reserves.

"ExxonMobil remains committed to its operations in Alaska. This sale does not impact our other Alaska operations or early planning activities for a possible Alaska LNG project," Jordan said.

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