www.AKRDC.org 9 VOLUME 1 | ISSUE 1 | WINTER 2024 Exploration east of Prudhoe Bay could yield new discoveries BY TIM BRADNER IT’S SHAPING UP TO BE A BUSY WINTER ON ALASKA’S NORTH SLOPE. ConocoPhillips is gearing up for its big Willow project, while Santos Ltd. has construction underway on its Pikka project. In a third development, a major exploration program on the eastern North Slope led by Lagniappe Alaska LLC, an independent, will see three exploration wells this winter and three more next year. For Willow, module fabrication has started on the U.S. Gulf Coast, a new gravel mine has been opened on the North Slope, ice roads are being built in preparation for road construction. Vertical Support Members, or VSMs, for pipelines will also be installed starting this season in preparation for pipeline construction next year. Willow is expected to start producing in 2029 with a rate of 180,000 barrels per day at its peak. ConocoPhillips is also confident in its cost estimates to first production in 2029, Andy O’Brien, the company’s Senior Vice President of Global Operations, told investment analysts Nov. 2. Much of the construction for Willow is now under contract and three-quarters of this is on a ‘lump-sum’ basis or unit rate,” he said. “This is the kind of project that is right in our ‘wheel-house.’ We’ve got no first-ofa-kind risk here. It’s three drill sites and one new processing facility,” O’Brien said. Because of that the company feels confident in its $7 billion to $7.5 billion projected cost, even with inflation. About 1,200 will be employed this winter on Willow. Pikka is about 30 percent complete in its second year of construction, said Mark Ireland, Santos’ Senior Vice President for Alaska, in a Nov. 22 presentation to investors. The company will have about 1,200 at work this winter on the project, which projected to produce 80,000 barrels per day in its phase one starting in 2026. Pikka will ramp up to 120,000 barrels per day in a second phase. Santos was able to lock in 60 percent of its phase one contracts and pricing for fabrication and drilling due to the company’s long lead-times in planning. This will allow the company to keep the project on budget, Santos told investors. Meanwhile, there are prospects for new discoveries in the exploration planned east of Prudhoe Bay, but it will take several years for any successful finds to be in construction and several more for new fields to be producing. The parties involved have a good track record. Lagniappe Alaska, an independent, is owned by Armstrong Oil and Gas, of Denver, headed by geologist Bill Armstrong. Armstrong led the exploration and development for several North Slope discoveries including the Oooguruk and Nikaitchuq offshore fields near the Kuparuk River field and, most recently, the Pikka project now being developed by Santos and its partner, Repsol. Oooguruk and Nikaitchuq are now owned and operated by Eni Oil and Gas. Other work is underway. Pantheon Resources, a U.K. company, is continuing production tests on discoveries near the Dalton Highway south of Prudhoe Bay. 88 Energy, of Australia, will do production tests on a discovery made last year also near the Dalton Highway. NORTH SLOPE SEASON BUSY WITH WILLOW, PIKKA WORK Photo Courtesy ConocoPhillips About 1,200 workers will be employed this winter on ConocoPhillips’ Willow project.
RkJQdWJsaXNoZXIy MTcxMjMwNg==