SSLZY - Santos to move forward with $2.6B Alaska oil project

Santos ( OTCPK:STOSF ) said on Wednesday it will proceed with the $2.6B Pikka phase 1 oil project at Alaska's North Slope, adding an estimated 80K bbl/day of crude oil to the market after it starts up in 2026.

Santos ( OTCPK:STOSF ) is the operator of Pikka and owns a 51% stake while joint venture partner Repsol ( OTCQX:REPYF ) ( OTCQX:REPYY ) holds the rest.

Crude from the Pikka development, which is between two existing oil fields, would be transported using existing infrastructure on the North Slope, including the Kuparuk pipeline and the Trans-Alaska Pipeline System, Santos said.

Santos, which plans to spend $1.3B on the project, estimates it can make a 19% return on investment if oil prices average $60/bbl over the long term.

"The project will add further diversification to our portfolio and reduces geographic concentration risk," Santos ( OTCPK:STOSF ) CEO Kevin Galllagher said, adding that Pikka "will be a net-zero project."

Santos ( OTCPK:STOSF ) also reported H1 net profit more than tripled from a year earlier to $1.2B from higher oil and gas prices .

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