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HomeLatest NewsRepsol and Australia's Santos promote oil mega-project in Alaska

Repsol and Australia’s Santos promote oil mega-project in Alaska

Date: October 2, 2022 Time: 19:27:07

Repsol and Australian company Santos have agreed to invest $2,600 million (about €2,555 million) in the development of Pikki, a mega field in Alaska that is largest oil discovery in the United States over the past 30 years, both companies said. The final investment decision on the first phase of the project was made Green light from Repsol’s Board of Directors. The group also indicated that further development of the project could bring the total investment in the field to over $3 billion (about $2.952 billion).

Pikka is Repsol’s first research project in Alaska, where the company has been operating since 2011 and has made several significant discoveries in northern slope area. A group led by Jos John Imaz owns a 49% stake in the project, and Santos, who partnered with Repsol in Alaska last year, buy your stake in Oil Search, has 51%. Thus, each of the companies will contribute about 1,300 million dollars (about 1,277 million euros).

The total investment of $2,600 million will cover early phase of Pikki’s development, and 80,000 barrels of oil per day is expected to start flowing in 2026, which will mean additional supply in markets under pressure due to reduced investment in upstream (exploration and production) around the world in recent years. In this sense, Santos CEO Kevin Gallagher believed that this project is “at the right time and in the right place”as “low-carbon oil projects such as Pikka Phase 1 respond to new supply demand from the OECD and are critical to US and global energy security, as highlighted by the Russian invasion of Ukraine.”

In late July, at a conference with analysts on the occasion of the presentation of the company’s results for the first half of the year, Repsol CEO Josu John Imaz already stated in relation to this project in Alaska that the final investment decision is expected to be made this quarter, “with the first oil forecast in the first half of 2026”. Repsol, which at the end of 2019 was the first company in the industry to set itself the goal of becoming a zero-emissions company by 2050, emphasized that the project is designed with a carbon intensity index that among the lowest in the global upstream portfolio company, which strengthens its commitment to low-emission projects.

One of the main “upstream” projects of the group

The company, led by Antonio Brufau, is thus taking an important step forward in one of its major projects “upstream”, which will thus provide first Repsol production in Alaska in 2026. Repsol added that with a phased development approach, Pikka was designed to provide “capital flexibility” while delivering top quartile emissions performance. In this sense, included reduction schemes will be implemented to further reduce emissions, such as replacing diesel with natural gas cleaner combustion for fuel operation or installation of heat recovery technologies in turbines to generate electricity.

The full development of “Phase 1” will consist of 45 wells will be drilled from one well pad.using industry-leading technologies to reduce environmental impact, with related intermediate facilities that include a manufacturing facility, operations center, sea ​​water treatment plant and pipes. The project enjoys the support of local communities, providing shared value through community development projects, social investment programs, economic activities and local jobs.

This milestone materializes over a decade of Repsol operations in Alaskawhere the company has been drilling 16 exploration and appraisal wells since 2011. The Podkova-1 and 1A wells drilled during the 2016-2017 winter campaign confirmed that the Nanushuk Formation is one of the traditional hydrocarbon discoveries on land in the US for 30 years.

Source: www.lainformacion.com

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