Technology, Investment Hasten Alaska Oil and Gas ‘Renaissance’

“Just years ago, we were not seeing this kind of increase in the forecast coming out of DNR, so this is a reversal of some expectations,” says Berry. She credits the reversal to investments by the Slope’s biggest producers, Hilcorp and ConocoPhillips, and a soon-to-be producer, Santos.

Soon is coming sooner, according to Pete Laliberte, vice president of business development at Santos. He notes that all equipment needed for Pikka is positioned on the Slope. “We’re about 91 percent of the way there. A little more than 91 percent,” he told the conference. “The fact that we’re there has given the confidence of our CEO to announce this week that we’re going to accelerate our target first oil date up to the first quarter of 2026. We originally had a target of midyear next year.”

Work is likewise proceeding apace in the Bear Tooth Unit, where ConocoPhillips Alaska is developing the Willow project inside the National Petroleum Reserve-Alaska. Donald Allen, an asset development manager at ConocoPhillips, noted that 2,000 workers were engaged in construction at Willow this year. “The Willow team continues to hit all of the key milestones, and the project remains on schedule for 2029 first oil,” Allen says.

Willow is expected to produce 200,000 barrels of oil per day, a staggering volume compared to the new oil that began flowing less than a year ago from Nuna, the newest ConocoPhillips project in the Kuparuk River Unit, adding 20,000 barrels per day. And, Allen adds, a companion to Nuna is underway nearby: “Next project in Kuparuk is going to be the Coyote project. That’s the Coyote reservoir in the northwest corner of Kuparuk River Unit. We started drilling that in 2025.”

Drilling this year also began at Point Thomson, formerly an ExxonMobil unit Hilcorp Alaska took over operations in 2022. Daniel Donovan, an asset team leader at Hilcorp, reports that the company drilled the first well at Point Thomson since 2017. “You may be saying, ‘What’s the big deal about a single well?’… It’s going to be a transformative well for Point Thomson,” Donovan says. “Currently, [the unit] makes a little over 4,000 barrels of oil a day; we expect about 6,000 barrels a day out of this well, so it’ll 2X the field’s current production.”

Donovan says the new Point Thomson well is expected to come online in the second half of 2026, but it’s tricky. The $180 million effort requires a special rig to be barged from the Nikaitchuq Unit, west of Prudhoe Bay, to Point Thomson on the eastern edge of the Slope.

Steel Canoe

Beyond putting more oil into TAPS, the renaissance also covers investments in Cook Inlet natural gas. Just as Hilcorp is reviving Point Thomson, the company figured out a way to upgrade the Tyonek platform, the source of 30 percent of the gas that Hilcorp supplies locally. Installed in the ‘60s, just barely visible offshore from Anchorage, the platform needs new wells, but there’s no room to put new shafts in Tyonek’s four legs.

Hilcorp Alaska structural engineer Sterling Strait told the AOGA conference that the solution was to run a new well on the outside of the platform’s leg. To protect the conduit from ice shoved by the inlet’s unceasing tides, Hilcorp devised a shield. The icebreaker resembles a canoe as tall as a five-story building and fabricated from inch-thick steel.

“Then it’s simply a matter of dangling this thing off the side of the platform with a crane, passing the load off to these winches, and setting it in place,” says Strait. “Weight of a 737; no big deal.”

He reports that the icebreaker was successfully installed a few weeks ago, thanks to careful planning and experienced marine operators. Next spring, Hilcorp plans to bring a rig to drill a new well for Tyonek.

Because offshore platforms are as cramped as a submarine, Strait says new wells will be capped with tree valves that squeeze two wellheads in the footprint of one. Similar hardware has likewise been deployed by HEX/Furie at its monopod platform in the Kitchen Lights Unit, renamed Allegra Leigh this summer after a successful drilling campaign.

HEX/Furie operations engineer Hunter Van Wyhe told the AOGA conference that the company figured out how to add four well shafts to the six already contained inside the monopod. “Adding those four slots to the platform not only allows you to produce more gas; it spreads the production risk across multiple wells and ultimately improves the deliverability of gas,” says Van Wyhe.

Breakthroughs

In touting the renaissance, Kurz spotlighted the role of new technologies. For instance, Hilcorp has pioneered the “polymer flood” technique, which has enhanced oil recovery at Milne Point. Donovan observes that the field’s production had declined by 2012 and was flat when Hilcorp took over operations in 2015. Since then, Milne Point’s output has tripled, returning to 2005 levels.

The pace of well drilling has quickened, too, thanks to speedier rigs. “We’re starting to see some significant reductions in drill durations,” says ConocoPhillips Alaska wells engineering manager Chris Brillion. Simply moving the huge hardware from place to place has become easier.

Robert Tirpack, senior engineering manager at Santos, notes that upgrades to Parker 272, a rig in the Nabors fleet, improved the mobility of the 1,800-horsepower behemoth. “We’ve got to the point where we can move with the derrick up,” Tirpack says, “so very quick rig moves.” Horizontal directional drilling at Pikka lets the 20-acre operating pad reach 20,000 acres under the unit.

Moving Fast

Fast-moving rigs lead to fast-moving projects. “We’ve been in a period of high capital investment by the oil and gas industry,” says Berry. “Oil and gas companies in Alaska expect that to continue over the next five or six years. They anticipate that they will invest a further $22 billion dollars in the state” over that period. And, she notes, that investment does not include the AKLNG gas pipeline, which could be a game-changer in the next decade.

Santos, pleased with Pikka’s progress since the Australian company acquired the asset in 2021, is looking to the future with the nearby Quokka and Horseshoe developments. Laliberte describes them each as Pikka-sized projects, and Phase 1 of Pikka is expected to peak at 80,000 barrels per day.

He breathed not a word of uncertainty about a looming $18.7 billion takeover by a consortium led by Abu Dhabi National Oil Company. Santos has extended a due diligence period, originally set to end August 8, until September 19. There is no hint that new owners might slow Santos’ Slope activities; however, timelines for Pikka Phase 2 and beyond are not set.

Hilcorp is scheduling kickoff in 2027 for another Prudhoe Bay renewal, which Donovan calls “West for the Future.” Project Taiga at the Omega Pad will involve twenty-two wells producing 25,000 barrels per day. “This is a huge, huge project,” says Donovan, who arrived in Alaska from Hilcorp’s Texas headquarters less than a year ago. “It’s really exciting for me when I come to a field that’s coming up to its fifty-year anniversary of first oil, and we’re still bringing on projects. By the end of Phase II, potentially over 40,000 barrels per day coming online.”

In two years, TAPS will be celebrating its fiftieth year in operation—which Kurz notes is double the pipeline’s original design life. The 800-mile pipe was built to move 9.5 billion barrels, but he sees the 19 billionth barrel coming soon.

Indeed, Alyeska Pipeline is already thinking about the 100th anniversary of TAPS in 2077. Kurz says, “The future that we have ahead of us is really shaped by our customers and upstream partners on the North Slope. Their innovation, investment, and determination are fueling what’s become known as our North Slope renaissance.”