North Slope oil production in seasonal rise as cooler weather sets in

Alaska North Slope production increased 30,000 barrels per day in September compared with August, on average, as maintenance work in producing fields was completed and cooler temperatures set in. Production facilities perform more efficiently as temperatures drop, processing more crude oil.

Total average production on the slope was 453,588 barrels per day compared with 423,803 barrels per day in August, the prior month. On a year-over-year basis, however, September production was down 18,900 barrels per day, compared with September 2022.

The year-over-year decline reflects a long-term trend of a gradual drop in production from the large, mature producing fields on the slope. This natural decline of oil is offset to some extent by new wells being drilled in the fields. Larger projects now being developed on the slope, such as Pikka, by Santos Ltd., will add substantial new production beginning in 2026, but for now North Slope production remains just below 500,000 barrels per day on a year-around average.

For September, all major producing fields on the slope showed gains over August. Prudhoe Bay, operated by major independent Hilcorp Energy and the largest producing field, produced an average 277,466 b barrels per day in September against barrels per day on average in August. The Kuparuk River field, the second largest producer, owned and operated by ConocoPhillips, saw output at 101,333 barrels per day in September compared with 100,180 barrels per day on average in August.

The Alpine field, also ConocoPhillips-owned and operated, produced an average 55,789 barrels per day in September against 49,369 barrels per day in August. The Lisburne field, owned and operated by Hilcorp, held generally steady at 19,005 barrels per day in September on average compared with 19,002 barrels per day in August.

The seasonal profile of production from the North Slope fields is consistent with previous years because of the efficiency of production plants, which is greater in winter cold weather and less in summer, with warmer temperatures. With greater operational efficiency in winter more oil is produced. The converse is true in summer, when plants are less efficient and production volumes drop.

Prudhoe Bay, the oldest field on the slope, shows the greatest variation because its facilities are now 46 years old, with operations beginning in 1977. Prudhoe production averaged about 321,172 barrels per day last January, for example, usually the coldest month of winter, compared with about 423,500 barrels per day in August. In contrast, other fields on the slope with facilities that are newer, held more steady in seasonal variation.

The near-term outlook for the slope is for production to remain generally at present ranges with small incremental additions from field projects offsetting natural decline of reservoirs as they age.

In 2026, however, the new Pikka field being developed by Australia-based Santos Ltd. is due to begin production, with an expected peak in Pikka’s first phase of 80,000 barrels per day. Santos owns 51 percent of Pikka and is the field operator, with Repsol, based in Madrid, owning 49 percent. Santos now has construction of field facilities for Pikka under way along with the drilling of development wells.

Among new projects that are pending attention is still focused on Willow, ConocoPhillips’ planned large development in the National Petroleum Reserve-Alaska and west of the North Slope’s producing fields. A federal court judge will rule in early November on lawsuits on Willow brought by conservation groups.

If Alaska U.S. District Court Judge Sharon Gleason gives the green light, ConocoPhillips will begin construction this winter on Willow. The project involves three production pads and related pipelines and support facilities including an oil and gas processing plant that will be able to handle production from new developments in the immediate area.

If field development proceeds Willow is expected to begin production in 2029 with a peak output of 180,000 barrels per day.

There is also continuing work on new discoveries in the central North Slope south of the large Prudhoe Bay field. U.K.-based Pantheon Resources has renewed tests on its Alkaid 2 well as part of the company’s planning for possible development of discovered resources. Nearby, Australia-based 88 Energy will perform production tests on oil discovered last winter in its Hickory 1s well.

Both developments are near key infrastructure, mainly the Trans Alaska Pipeline System and the all-weather Dalton Highway, a state of Alaska-maintained road that connects the North Slope with Interior Alaska highways.

Because of the virtual year-around access by highway the logistics of developing discovered oil in this area is simpler because there are fewer seasonal operating restrictions, like requirements to build snow and ice roads to remote sites.

Pantheon is planning development of its discoveries with horizontal wells and compact, mobile production units that can be moved to the location by truck.

Another area being watched is east of Prudhoe Bay where efforts are under way to rebuild production at the small Badami oil field. Due to complications in the producing reservoir Badami has never met production goals.

The field produced 18,000 barrels per day at peak, below its expected 30,000 b/d, and most recently declined to 1,400 barrels per day. Its owner, independent Glacier Oil and Gas, has brought in new investment and plans new drilling to reach a nearby oil accumulation.

The state Department of Natural Resources agreed recently to reduce the state’s royalty on Badami leases to improve the field economics. Without the reduction Badami would be uneconomic to produce, state officials said in an analysis of the decision.

Badami is important because it helps support a pipeline connecting the field to Prudhoe Bay, about 25 miles west, as well as to the large Point Thomson gas and condensate field about 20 miles east.

Point Thomson has faced its own production challenges due to the difficulty of producing gas and liquid condensate from a high-pressure reservoir where the gas must be injected back underground.

However, interest in exploration in the region is picking up and state officials say it is important to keep the pipeline and other infrastructure that extends east of Prudhoe Bay intact, to encourage new development.

One pending project is at Sourdough, a discovery made by BP several years ago and where independent Jade Energy plans new exploration drilling next year. BP estimated Sourdough reserves at 50 million barrels but Jade, through subsequent work, feels that estimate is very conservative.

Sourdough is located almost at the border of state of Alaska lands and federal lands in the Arctic National Wildlife Refuge.