Oil Search on track at Pikka
Oil Search Alaska told the state Department of Natural Resources that it is on track for a Final Investment Decision with its partner, Repsol, on its Pikka project in late 2020 (late October is reported) and that final engineering, permitting and other planning, as well as more drilling, will be underway this winter. However, Oil Search has not yet reached an access agreement with Kuukpik Corp, the owner of surface lands in the project area. Kuukpik is the village corporation for the Inupiat community of Nuiqsut, which is near the project.

In another development the North Slope Borough’s planning commission rejected a zoning change for the project area requested by the company. The change was opposed by some Nuiqsut residents. The borough’s assembly will make the final decision on the change, however.

Oil Search meanwhile hopes to have a two-year civil infrastructure program underway starting this winter for gravel roads and pads, and bridges. The company hopes to begin development drilling in 2022 and have initial production of 30,000 barrels per day late that year, and to commence full production in 2024. In its drilling this winter Oil Search will test, in one well, for oil accumulations east of the Pikka discovery and, in a second well, new oil west of the company’s Horseshoe find south of Pikka. Both Pikka and Horseshoe are near the Colville River.
Point Thomson still struggles
The Point Thomson gas and condensate project east of Prudhoe Bay is producing about half of a 10,000 barrels per day goal anticipated in a 2012 litigation settlement between the state of Alaska and project owners ExxonMobil and BP. In 2018, when work on a large gas pipeline (the Alaska LNG Project) slowed, the state Department of Natural Resources waived a 2019 deadline for an expansion of Point Thomson.

ExxonMobil, the project operator, has installed new equipment and has more on order to solve technical problems in gas compression facilities and small increases in condensate production were reported after in the first installation. The company is also working with promoters of an Arctic natural gas liquefaction plant that could export LNG to market from the Point Thomson area. If this proves realistic it would allow ExxonMobil to show it is complying with the spirit of the 2012 settlement with commercial sales of gas.
Small Mustang field now producing
The small Mustang oilfield on the slope is finally online after several years of work. Brooks Range Petroleum is now shipping oil through the nearby Alpine pipeline. The company plans to eventually produce 15,000 barrels per day from Mustang.
88 Energy trying again on slope
88 Energy, a small Australian independent, has partnered with London-based Premier Oil to drill the Charlie 1 exploration test starting in February. The companies are drilling at the site of a BP exploration well drilled in the early 1990s that showed oil, but was not pursued further. 88 Energy has been actively exploring on the slope in recent years.
Reductions in slope oil costs seen
ConocoPhillips is seeing dramatic reductions in its costs of developing new oil resources on the slope thanks mainly to new technologies like horizontal drilling. At Narwhal, a discovery near the Kuparuk River field, an initial resource estimate of 150 million barrels is now at 400 million barrels. Recovery costs are estimated at below $30 per barrel, ConocoPhillips told investment analysts. Development costs at Willow, a larger find, are estimated at $45/barrel. Horizontal drilling allows deposits to be developed with reduced surface infrastructure, which cuts costs.