ConocoPhillips and Santos officials give glowing assessment of Alaska North Slope prospects

Both companies are building major projects, and senior officials told an industry audience that the future is bright for new oil development in Arctic Alaska

Managers of two oil companies with major North Slope projects underway gave a bullish assessment of the region’s prospects in presentations at an industry conference Friday in Anchorage.

ConocoPhillips Alaska Inc., which is building its large Willow project that is expected to generate up to 180,000 barrels a day when production starts at the end of the decade, is similarly busy at its established oil sites elsewhere on the North Slope, said Connor Dunn, a senior vice president with the company, in his presentation at the Meet Alaska 2024 conference.

“Whilst Willow has been big and public and required a lot of focus, there’s just as much activity across Kuparuk and Prudhoe and elsewhere on the Slope. So it’s a really exciting decade ahead for our industry in this stable fiscal environment,” said Dunn, who oversees Willow development.

He said there has been “a real wave of projects and development that really is bursting new life into the North Slope.”

Mark Ireland, senior vice president for subsurface and exploration at Santos, the company developing the huge Pikka project on state land east of Willow, was also enthusiastic about the North Slope’s long-term prospects.

“We’re seeing levels of activity that we haven’t seen for a decade or so, with more to come,” Ireland, an Alaska oil veteran whose North Slope work dates back to the early 1990s, told the Meet Alaska audience.

Meet Alaska is an annual conference held by the Alaska Support Industry Alliance, a trade association of oil support companies.

For ConocoPhillips, Willow has been a high-profile project. Despite harsh criticism from environmentalists and some Native groups, the Biden administration last year approved Willow’s development.

The company is investing more than $7 billion to get to what’s known as first oil production, expected in 2029, Dunn said. In all, about 2,500 workers are expected to be employed during construction, he said, and ongoing activities include road-building, the opening of a new gravel mine, and seismic surveys in an area where ConocoPhillips hopes to do more drilling to add to Willow’s known reserves.

Outside of Willow, there is ongoing development drilling within Prudhoe Bay, continued development of satellites in Kuparuk and continued exploration in the western North Slope area, Dunn said.

Australia-based Santos acquired the Pikka project when it merged with another Australian company, Oil Search.

For it, Pikka development is in just the first phase of what could be a source of oil rivaling Kuparuk, the North Slope’s second-largest oil field, Ireland told the Meet Alaska audience.

Pikka’s first phase got the official go-ahead by the corporation in August of 2022. It represents an investment of $2.6 billion by both Santos and its partner, the Spanish oil company Repsol, Ireland said. It will tap into a deposit of about 400 million barrels of oil and is expected to produce up to 80,000 barrels of oil a day starting in 2026.

“When we add in our annual exploration appraisal program, I think in a few years in the future, we’ll be looking at north of 2, 3 billion barrels of development in front of us. And that’s where we get to the scale of a Kuparuk.”

The first and second phase of Pikka, plus other deposits of oil that have been found nearby represent, in combination, over 1.5 billion barrels of known oil, Ireland said. Ongoing exploration is bound to yield more than that, he said.

“When we add in our annual exploration appraisal program, I think in a few years in the future, we’ll be looking at north of 2, 3 billion barrels of development in front of us. And that’s where we get to the scale of a Kuparuk,” he said.

Not addressed in either presentation was a still-lingering dispute between Santos and ConocoPhillips over road access.

The companies had been haggling over the price that Santos should pay to use gravel roads in the Kuparuk unit that were built by Arco Alaska Inc., Kuparuk’s original developer and ConocoPhillips’ predecessor company. Santos needs access to those roads to reach the Pikka site from the more developed areas of the North Slope to the east.

With no agreement reached between the companies, the Alaska Department of Natural Resources in 2022 gave Santos a permit to use those Kuparuk roads, and the department upheld that decision late in the year, rejecting a ConocoPhillips administrative appeal.

ConocoPhillips followed up with a lawsuit against the department that was filed on Dec. 30, 2022. The lawsuit remains active, with a status hearing scheduled for March 26, according to the Alaska court system’s website.