Regulatory and fiscal stability herald bright future for investment in Alaska
There is a renaissance underway on the North Slope driven primarily by two huge projects – Santos’ and Eni’s Pikka development and ConocoPhillips’ Willow. Together, these two, new oil fields will increase production to levels not seen in in two decades.
Despite the challenges that come with operating in the Arctic – high costs, harsh weather, supply chain issues, legal hurdles and fluctuating oil prices –Alaska can expect $22 billion in planned oil and gas industry investment between 2025 and 2030, according to a petroleum economics study by Anchorage-based McKinley Research.
“By 2034, more than 60% of North Slope production will come from fields that, today, have yet to put a single drop into the Trans Alaska Pipeline System,” the study found.
We cannot control many of the challenges Arctic operations bring, but we can maintain fair and stable tax policies that attract the capital needed to keep our resource industries healthy so they can produce jobs and revenues for Alaskans.
Let’s keep Alaska competitive!
What’s at stake
$4B
State & Local Revenue
FY25
70,425
Alaskan Jobs Supported
Direct/Indirect
$0.5B
Grow the Permanent Fund
FY22 Dedicated Revenues to Corpus
$5.8B
Spending with Local Businesses
Annual
Source: McKinley Research for AOGA
Stable tax policy leads to resource renaissance on the North Slope
Another big piece of Alaska's energy future has fallen into place.
APA Corporation (formerly Apache) has announced a $70 million deal to acquire the Badami production facilities and the Nutaaq Pipeline on Alaska's North Slope. While that may sound like an infrastructure story, the bigger picture is what it could mean for future development in the area.
The acquisition gives APA control of infrastructure that connects directly to the Trans-Alaska Pipeline System (TAPS) and sits near the company's eastern North Slope acreage, including the area surrounding the promising Sockeye discovery announced by Santos and their joint venture partners, APA and Lagniappe Alaska LLC, earlier this year.
"The acquisition secures control of strategic infrastructure adjacent to our eastern North Slope acreage and enhances our ability to execute our planned drilling program," APA CEO John Christmann said.
APA plans to drill both an exploration well and an appraisal well during the 2026-2027 winter season. Those efforts will help evaluate the Sockeye complex, where project partners estimate the main reservoir could contain as much as 700 million barrels of recoverable oil, while also determining how existing Badami infrastructure could support future development.
For Alaska, this is another reminder that infrastructure matters. Roads, pipelines, production facilities and access to TAPS can help turn discoveries into projects, jobs and long-term economic opportunities.
PHOTO: Badami
The federal government wants to reopen about a million acres in the National Petroleum Reserve–Alaska near Teshekpuk Lake.
The acreage had been protected under a conservation agreement with a Native coalition known as Nuiqsut Trilateral. The Trump administration canceled the agreement in December ahead of an oil lease sale in March, but U.S. District Court Judge Sharon Gleason blocked the lease sale in parts of the protected area.
Last month, the U.S. Department of the Interior asked the 9th U.S. Circuit Court of Appeals to review.
Lawsuits were filed, saying the cancellation was illegal, as was Gleason’s decision to place the area off limits to leasing while the case goes forward.
The federal government’s opening arguments are due by July 6, with the last briefs expected in August.
Meanwhile, written arguments in the underlying case are scheduled to be finished by the end of June, with oral courtroom arguments to follow.
PHOTO CREDIT: Jim Dau, Bureau of Land Management
When Pikka hits full production of 80,000 barrels/day, it will be the second-largest producing field on Alaska’s North Slope.
“This is one of the most significant achievements on the North Slope in decades and further cements the region’s renaissance. Pikka will help refill the Trans-Alaska Pipeline System, create great jobs for Alaskans and bring billions to the state over its lifespan — benefiting all who live here,” said Sen. Lisa Murkowski in a news release.
“It will be the anchor asset that underpins our long-term growth,” said Bruce Dingeman, Santos’ Executive Vice President and President Alaska. “It’s a core growth pillar in Santos’ portfolio.”
Lawmakers, oil advocates and the industry call the production a “major milestone,” and predict roughly 400 full-time jobs. Santos expects Pikka to produce 400 million barrels of oil over its expected lifetime of 30 years.
While it’s large, it’s not huge like the legacy fields of the ‘70s.
“It’s not Prudhoe Bay,” said veteran journalist Larry Persily. Prudhoe Bay alone averaged roughly 202,600 barrels per day from 2019-2023 fiscal years, according to data from the Alaska Department of Revenue.
Still, if Pikka reaches the 80,000 barrels per day that Santos – and its partner Repsol – forecast, it would be the second-largest producing field in the state after Prudhoe Bay. At more than $3 billion, it’s also one of the most expensive.
Photo Credit: Santos
Letter from the co-chairs
Fair and Competitive oil taxes are working
There is a resurgence in oil production and jobs in Alaska that is directly related to our current oil tax policy. SB 21, a fair and competitive tax policy, replaced the antiquated ACES tax structure that drove down petroleum investment for more than a decade. Thanks to SB 21, Alaskans have the greatest opportunity of our generation on the North Slope today.
Some present and former legislators argue that SB 21 was a mistake, but the facts speak for themselves.
The Willow and Pikka projects, years in the making, are in active development, with Pikka now expecting first production any day now. These and other robust investments in Alaska’s future would not have occurred under the previous punitive tax regime. Between the Willow and Pikka projects alone, the oil and gas industry is spending over $10 billion in Alaska, with each project generating thousands of construction jobs and hundreds of operating jobs.
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