Following an exceptional year results-wise, ConocoPhillips CEO Ryan Lance on Thursday announced the Houston super independent is spending $400 million to bolt-on leases in Alaska, even as it continues to emphasize Lower 48 unconventional development.

Lance said the Alaska deal is "a very attractive transaction" that consolidates the company’s western North Slope position. It acquired Anadarko Petroleum Corp.'s 22% nonoperated interest, as well as an interest in the Alpine Pipeline. The deal is subject to regulatory approvals with an effective date of Oct. 1, 2017.

ConocoPhillips would have 100% interest in about 1.2 million acres of exploration and development lands, including the joint oil discovery, Willow, after two test wells in the Brookian Nanushuk formation struck oil early last year. Potential production was up to 100,000 b/d with initial commercial production targeted for 2023, pending permit approvals and project economics.

Executive Vice President Al Hirshberg, who oversees Alaska production and drilling operations,  said Alaska continues to be a "core strategic position" for ConocoPhillips, which has a 40-year history there and remains the state's biggest producer.

"We have a lot of confidence in our Alaskan operating drilling and exploration teams, and they are going to bring us more rewards on the western North Slope going forward,” he said. “Our Willow discovery is an indication of that.”

Lance said 2018 was slated to be a big year for the company.

Production in 2017, excluding Libya, was 1.35 million boe/d, with output in the final period reaching 1.2 million boe/d, a decrease of 368,000 boe/d from 2016. Excluding the impact of sales of producing assets, sequential production in 4Q2017 increased by 45,000 boe/d.

ConocoPhillips expects to achieve overall production of 1.19-1.23 million boe/d in 2018, which represents a 5% increase, excluding sales impacts of 191,000 boe/d.

First quarter 2018 production is expected to average 1.18-1.22 million boe/d.

Greater well efficiencies and higher per-well production rates are forecast in 2018, led by the Eagle Ford and Bakken shales and the Permian’s Delaware sub-basin.

Preliminary 2017 year-end proved reserves are 5 billion boe, with ConocoPhillips estimating that net additions, excluding market factors and dispositions, are expected to be 605 million boe, with about 70% of the growth from the Lower 48 basins.

"We exited 2017 with more than 5 billion boe of high-quality reserves as part of our 15 billion boe resource base that has an average cost of supply below $35/bbl," Hirshberg said.

In the Lower 48, the "big three" basins collectively in 4Q2017 produced 236,000 boe/d, a 12%, or 25,000 boe/d, increase from the third quarter, Hirshberg noted. Lower 48 production is expected to hit 300,000 boe/d this year.

"The public data...on the Eagle Ford, Bakken and Delaware clearly shows that the production rates, the per-well production rates of our wells, [were] considerably higher in 2017 than they were in 2016 and continue to improve significantly," Hirshberg said.

For 4Q2017, ConocoPhillips earned $1.6 billion ($1.32/share), compared with a net loss of $35 million (minus 3 cents) in 4Q2016. For full-year 2017, net losses totaled $900 million (minus 70 cents/share), compared with a 2016 net loss of $3.6 billion (minus $2.91).