Australia’s Santos Ltd., the operator of the Pikka Unit joint venture in Alaska, expects initial production from Pikka Phase 1 to start by 2026, according to the Adelaide-based company’s Managing Director and CEO Kevin Gallagher.

Pikka Phase 1, located on the North Slope of Alaska, includes a single drill site, an oil processing facility and other infrastructure to support production of 80,000 bbl/d, according to Santos.

“The Pikka project has made excellent progress over the winter months in Alaska,” Gallagher said in the company’s first quarter 2024 financial statement.

Gallagher said Pikka was a world-class project — like the Barossa gas project offshore Singapore— and would be transformative for Santos and provide the company with long-term, stable cash flows over the next 10 years to 15 years.

Santos announced its $2.6 billion final investment decision (FID) for Pikka in August 2022. Santos’ share of the FID is $1.3 billion, according to the company’s website. Santos is 51% owner of Pikka Phase 1 in partnership with Spain’s Repsol which holds the remaining 49% of the project.

Pikka Phase 1 progress

According to Santos, the Nanushuk play in the Pikka Unit represents one of the largest conventional oil finds in the U.S. in the past 30 years. Pikka Phase 1 is the most significant development on Alaska’s North Slope in more than 20 years, Santos said on its website.

For Santos, Pikka Phase 1 adds diversity to the company’s portfolio and reduces geographic concentration risk, according to the company. For Repsol, Pikka Phase 1 offers the Spanish company an advantaged onshore position and low carbon intensity production (12 kgCO2/boe), the European energy giant said during its fourth-quarter 2023 webcast.

At the end of first-quarter 2024, work related to Pikka Phase 1 was 47% complete, Santos said in the financial statement.  

During the quarter, Santos completed rig operations on seven wells, of which four have been stimulated with three successfully flowing back at favorable rates compared to pre-drill expectations. 

Vertical support members for the pipeline are more than 65% complete and pipelaying was more than 61% complete for the winter season objectives. The seawater treatment plant was 62% complete at the end of the quarter, Santos said.

The development plan for Pikka Phase 1 will generate a small surface footprint, according to Santos, and utilize existing infrastructure, including the Kuparuk transportation pipeline and the Trans-Alaska pipeline system.