Unsuccessful exploratory drilling in Alaska and the deepwater Gulf of Mexico have increased the 2002 net losses for ConocoPhillips by $18 million, the company said Monday.

The Houston-based major reported one dry hole was on Alaska’s North Slope. The McCovey well began drilling in November 2002 and reached total depth on Jan. 27. The Voss deepwater well, located in Keathley Canyon Block 511 in the Gulf of Mexico, began drilling in September 2002. It reached total depth on Feb. 7. Neither well encountered commercial hydrocarbons, according to ConocoPhillips.

Because ConocoPhillips has not yet filed its 2002 financial statements with the Securities and Exchange Commission, accounting rules require that the company include the amount of dry hole costs incurred last year in its 2002 financial results. The final results of the two wells were not determined until February, so the dry hole charges were not included in the company’s preliminary 2002 results announced in late January.

The $18 million after-tax dry hole costs increased the company’s net loss for 2002 to $295 million, or 61 cents per share. The remaining drilling costs on the wells incurred in 2003 will be charged to dry hole expense in the first quarter of 2003.

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