Oil Search, which was based in Papua New Guinea, bought Armstrong’s stake in an $850 million deal announced in late 2017. His company discovered the 750-million-barrel deposit in a geologic formation, Nanushuk, that other oil explorers had drilled through more than 100 times without detecting major petroleum deposits. Pikka’s prospects were announced several years ago by a renowned wildcatter, Bill Armstrong. Mike Dunleavy and Natural Resources Commissioner Corri Feige. “As the first major oil development on state lands in over a decade and one of the largest new finds on the North Slope, Pikka is both exciting and very important to Alaska,” she said.Īlaska Gov. Natural Resources Commissioner Corri Feige said she has “full faith” that ConocoPhillips and Oil Search will reach an agreement over road access, and adds that she does not expect the issue to be a “significant factor” in Pikka’s development. But others are more optimistic about its fate, and the future of Alaska’s fossil fuels. Neither ConocoPhillips nor Santos would comment on the developments surrounding Pikka. It has been Alaska’s most promising project lately, as the other major development on the North Slope’s horizon, Conoco’s Willow prospect, has been delayed by litigation and a new Biden administration environmental review. Pikka would produce 80,000 barrels a day from its first phase, with the possibility of expansion. Industry boosters look to new petroleum projects to sustain jobs and minimize per-barrel costs of shipping oil down the Alaska pipeline, as output falls from older developments. “It underlines what has been said over the past number of years, as far as Alaska’s North Slope becoming less and less of an attractive investment.”
Josiah Patkotak, who chairs the Alaska House Resources Committee. “It’s writing on the wall when we talk about the state’s competitiveness,” said Utqiagvik independent Rep. Josiah Patkotak, Utqiagvik’s state representative, talks with a reporter in the Arctic Slope Regional Corporation boardroom on Nov. The twin developments have been rippling through Alaska’s oil industry and its political landscape, and frustrating some observers who have grown anxious to see Pikka advance as activists convince a growing number of banks and insurers not to finance Arctic oil.
That decision - the green light on whether to actually build the development - is currently scheduled for the middle of this year. Without guaranteed road access, Oil Search cannot proceed with its final investment decision for the first phase of the Pikka project, the company said in a letter last month to the Alaska Department of Natural Resources. reported that the company has put its 51% stake in Pikka up for sale.Īround the same time, Santos’ Alaska subsidiary, Oil Search, complained that ConocoPhillips is demanding “exorbitant” fees, totaling hundreds of millions of dollars, in exchange for allowing vehicles to cross its roads that connect the North Slope’s Prudhoe Bay oil hub with the new Pikka prospect. The $3 billion Pikka project could ultimately boost the flow of oil down the trans-Alaska pipeline by 25%, and it faces less opposition from conservation groups and Indigenous residents than other major North Slope developments.īut last month, a news outlet in Australia - home of the project’s new owner, Santos Ltd. The fallout from a merger deal and a multimillion-dollar dispute with ConocoPhillips over road access are threatening to snag one of Alaska’s biggest new North Slope oil developments.
The company, along with Armstrong Energy, discovered the promising Pikka prospect. A drill rig works for Repsol at its Colville Delta operations in 2014.
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