hen people discuss the pioneers in the oil and gas industry, they generally point to companies like ARCO, Exxon, and bp, which initiated oil exploration and development in Alaska in the late ‘60s. However, as oil fields age, a new type of pioneer is coming to the forefront, one that can extend the life of an oil field and enhance its production beyond what was previously expected. Hilcorp has celebrated ten years of operating the Milne Point Unit and celebrating a significant oil production increase since taking partial ownership in 2014. Now, as full owners, the company attributes its North Slope success to a well-tuned strategy and innovative applications.

When it comes to oil and gas production, Hilcorp isn’t about reinventing the wheel; it’s about making the wheel roll more efficiently. Milne Point, a 71,000-acre oil field 25 miles northwest of Prudhoe Bay, is this concept in action. Discovered in 1969 by Conoco, Milne Point was brought online in 1985 as the third North Slope field, nestled near the coast between Prudhoe Bay and Kuparuk River. Conoco sold the unit to bp in 1994. Despite declining production, it held a lot of potential for Hilcorp when it acquired a 50 percent stake in 2014.

While most producers viewed Milne Point as an aging asset, Hilcorp developed a roadmap to extend the life of the field and make it viable again. At the height of its production in the late ‘90s, Milne Point averaged 60,000 barrels per day; however, by 2014, when Hilcorp became the operator and partial owner, production had declined to around 18,400 barrels per day.

Jill Fisk, senior asset team leader for Milne Point, says Hilcorp’s mission to revive aging fields boils down to a general strategy and applying specific production methods.

Fisk says the first thing Hilcorp does after acquiring an asset is arrest production decline to prevent the decline in production from continuing. Next, it stabilizes the field by controlling the cost of production and operating expenses in a way that is profitable and leads to future growth. Finally, Hilcorp invests in repairing and maintaining existing infrastructure and developing additional facilities that draw more value from the field.

“Milne Point is an example of how we’ve implemented this strategy over the last ten years,” says Fisk.

In the case of Milne Point, those investments included the development of Moose Pad and Raven Pad, which provided space for 100 and 60 additional wells, respectively. Hilcorp spent $270 million for Moose Pad. Raven Pad is already producing 5,000 barrels of oil per day. Overall, Hilcorp has invested $1 billion into the Milne Point unit and drilled more than 100 wells.

“To increase production, you can’t just drill wells,” says Fisk. “It takes investment in surface facilities and maintaining aging facilities and aging infrastructures as much as drilling.”

The other game-changer that allows Hilcorp to increase production from aging fields is an innovative approach known as polymer flooding. Polymer flooding is an enhanced oil recovery method that uses high molecular weight polymers to decrease the water/oil mobility ratio by increasing the viscosity of the displacing water. It’s a method used worldwide but, until Hilcorp arrived, never on the North Slope. Traditionally, companies use water flooding to displace oil toward a production well. Of the two methods, polymer flooding has proven more effective.

When it comes to Milne Point’s second life, numbers don’t lie. Hilcorp increased production to 34,000 barrels per day by 2020, which hadn’t been seen since 2008. Last year, it increased that amount to 50,000 barrels per day, triple what it produced when Hilcorp took over operations. Hilcorp estimates that number could return to 60,000 barrels per day in the next four to five years.

“It’s important to note that we hit a high mark around our ten-year anniversary of ownership of Milne Point,” says Matthew Shuckerow, Hilcorp’s corporate manager of Alaska government and public affairs. “And we are just as optimistic about the future of all our assets in Alaska.”

Additional changes occurred with regard to Hilcorp’s ownership status of Milne Point and other North Slope assets. In 2020, Hilcorp bought bp’s remaining assets, including its remaining interests in Milne Point. In 2024, Hilcorp increased its presence in the North Slope by purchasing the Oooguruk and Nikaitchuq fields from Eni, with plans to extend polymer flooding to those units immediately northwest of Milne Point. Combined with other assets in Cook Inlet and Kenai, Hilcorp is Alaska’s biggest oil and gas operator and largest natural gas producer.

Based in Houston, Texas, Hilcorp first entered Alaska in 2011 when it purchased assets in the Cook Inlet. Currently, it has more than 950,000 gross acres under production statewide with more than 1,700 producing wells. Those assets produce more than 135,000 barrels of oil equivalent per day and are staffed by a workforce of more than 1,700, of which more than 75 percent are Alaskans. Hilcorp maintains more than 700 partnerships with Alaska businesses, generating around $750 million in annual spending with state vendors.

“Hilcorp has gained a lot of experience over the last decade,” says Shuckerow. “And while other companies are stepping away from the North Slope, we are taking a long-term approach that builds on our current success.”

Shuckerow adds that none of this success comes without a dedicated team to implement Hilcorp’s strategies. The Asset Team comprises engineers and geologists prospecting new drilling areas and working with an extensive field crew to monitor production in existing fields.

Fisk says the key to achieving their goals is through quick wins and constant improvement. Besides polymer flooding, she says drilling advancements made it possible to increase production. She says working in the North Slope is very different from working anywhere else, including Cook Inlet and the Kenai Peninsula. She says understanding the logistics and operations in the North Slope was an initial challenge for Hilcorp, but the company quickly learned how to be efficient in controlling operating costs and developing new tactics to get as much value out of their fields as possible.

“Improvement is a constant challenge,” says Fisk. “We get better not by comparing ourselves to the previous operator but by comparing ourselves to what we’ve already achieved.”