Last year, environmentalists criticized the Biden Administration for approving a large oil drilling project on public land in the Alaskan Arctic called the Willow project.

However, a similar petroleum project has drawn little attention. About 30 miles east of Willow, Australian energy company Santos, Spanish company Repsol, and ASRC Energy, a subsidiary of the Alaska Native-owned Arctic Slope Regional Corporation (ASRC), has received approvals and is currently building the first phase of the Pikka Project, an effort to produce hundreds of millions of barrels of oil over the next three decades. The project is located entirely on land owned by the State of Alaska and the ASRC.

During his first term, President Trump expanded federal lands in Alaska open for oil and gas drilling. President Biden then cancelled some leases and moved to restrict some areas in the Arctic open for energy exploration, although he also approved the massive Willow drilling project. During his second campaign, Trump promised to re-open even more Alaskan lands as part of his “Drill, Baby, Drill” agenda.

“The U.S. should unapologetically pursue American interests in the Arctic,” the Republican roadmap for Trump’s second term, Project 2025, says of drilling in Alaska.  “…The region is estimated to contain 90 million barrels of oil and one-quarter of the world’s undiscovered natural gas reserves.”

The Pikka Project on the North Slope of Alaska would be Santos’ first project in the U.S. The company is Australia’s biggest producer of natural gas, with other operations across Southeast Asia. In October, the Australasian Centre for Corporate Responsibility sued Santos for greenwashing because of its plan to reach net-zero greenhouse gas emissions by 2040, which the organization described as “little more than a series of speculations.”  

In Alaska, Santos has become the state’s second-largest oil and gas leaseholder, with plans to begin producing oil from the Pikka Project by 2026. It opened an office in Anchorage and began hiring workers, saying in a presentation to Alaska legislators in February that it would have 430 employees in the state by the end of this year.  

ConocoPhillips’ Willow Project drew intense scrutiny from environmentalists and the media, with many seeing it as a test of the Biden Administration’s commitment to transitioning away from fossil fuels and addressing climate change. Biden approved the Willow project in March 2023.  

The Pikka Project, by contrast, has gotten little attention outside of Alaska. The project is slightly smaller than Willow, which ConocoPhillips says would produce up to 600 million barrels of oil over 30 years, with a peak of 180,000 barrels per day. Santos says Pikka will produce about 400 million barrels over 30 years, with a peak of 80,000 barrels per day.  

Santos originally planned to produce oil on 77,744 acres but earlier this year announced a 19,664-acre expansion, bringing the total to 97,408 acres, about 152 square miles – roughly the size of Denver.  Phase I of the project has been approved and is under construction, and major approvals have been secured for the second phase of the project.

Nauri Simmonds, executive director of Sovereign Iñupiat for a Living Arctic, has worked in the oil and gas industry for a different ASRC-owned company. The industry’s impact is mixed on communities like Nuiqsut, a tribal village located between the Willow and Pikka oilfields.  

A 2022 ConocoPhillips gas leak forced people in Nuiqsut to evacuate their homes, with what Simmonds described as poor communication from authorities making it difficult for people to know when to leave and when it was safe to return. Oil development has disrupted caribou herds that people rely on for meat. At the same time, the industry has built roads that make some areas more accessible, and many depend on oil industry jobs and dividends they receive from Native corporations that support drilling.  

“It creates a form of dependence,” Simmonds said. “You need money for snow machines, you need money for ammo, you need money for equipment.”

The rest of the U.S. is much less dependent on Alaskan oil than in previous decades. Alaska’s share of U.S. oil production has declined from a high of 25 percent in 1988 to less than 4 percent as of 2022. Over the past 40 years, Alaska’s share of overall production has declined compared to other oil-producing regions, such as Texas, New Mexico, and North Dakota. In these states, horizontal drilling and hydraulic fracturing unlocked oil from shale formations previously considered too expensive to produce.

Oil production on Alaska’s North Slope began with the industry's discovery of reserves in Prudhoe Bay in 1968. Then followed the construction of the Trans-Alaska Pipeline System, an 800-mile pipeline network completed in 1977. All of the oil produced on the North Slope has to flow through the Trans-Alaska Pipeline, which delivers crude oil to refineries and export terminals along the Prince William Sound in Valdez.  

Willow, which is currently under construction, and Pikka are far from the biggest of the roughly two dozen oil fields in the North Slope, the largest being Prudhoe Bay, where commercial production began in 1977. However, they have the potential to continue producing for decades, even as the U.S. and other countries have stated goals of reducing fossil fuel consumption to combat climate change.  

“What’s so radical about it is they made a really big bet in a controversial place,” said Philip Wight, an environmental historian at the University of Alaska Fairbanks. “Their bet was basically, ‘We're going to need a lot more oil, even though scientists are saying we need to have a carbon-constrained world.”

Wight said the Trans-Alaska Pipeline’s purpose has shifted since the 1970s and 1980s when it was about “delivering Alaskan oil for American energy security.” Instead, Alaskan officials want to see oil development continue to bring in more revenue to the state.

“It’s not that the nation needs Alaska’s gas or Alaska’s oil,” Wight said. “It’s that Alaska doesn’t have a sustainable fiscal model, and we need to produce the oil in order to keep the state afloat.”  

Santos, the Australian company developing the Pikka Project, claims it has a “goal of achieving net-zero” by 2040. The company says it will offset the greenhouse gas emissions from all its oil and gas production, including the Pikka Project, by sequestering carbon dioxide. The company is currently working on three carbon sequestration hubs in Australia.  

In Alaska, Santos, Repsol, and ASRC Energy make up a group called the Alaska CCS Consortium, with a “long-term vision” of carbon capture and storage sites on the North Slope and in Cook Inlet, near Anchorage. The Department of Energy awarded the consortium $3 million from the Bipartisan Infrastructure Law for a “pre-feasibility study” of locations in Alaska that could be used for a direct air capture facility that would suck carbon directly from the atmosphere and store it underground.  

It's unclear whether any of these ideas will become a reality. Carbon capture and sequestration technologies have yet to be deployed in the U.S. on a large scale and they have not proven themselves to be financially viable. There are currently no pending applications in Alaska for wells to store carbon dioxide underground.  

Climate change is already reshaping the Alaskan Arctic. Thawing permafrost is softening the ground, causing shifting and cracks in buildings and making it more difficult for oil companies to maintain well pads, roads, pipelines and other equipment. Ironically, companies such as ConocoPhillips must use refrigeration devices called thermosyphons below pipelines and other infrastructure to keep the permafrost frozen, even as they produce fossil fuels responsible for thawing the permafrost.  

The region is also experiencing freezing rain in winter instead of snow. This icy crust prevents wildlife such as caribou from reaching food underneath the snowpack. The layer of ice also makes it difficult for people to travel via snowmobile or dogsled, some of the only ways to travel in an area with few roads.  

According to climate scientists, the Arctic has warmed nearly four times faster than the rest of the planet. This warming is causing sea ice to retreat and affecting all kinds of wildlife – seals, caribou, polar bears, and migratory birds, said Cooper Freeman, Alaska director for the Center for Biological Diversity.  

“Everything’s changing,” Freeman said. “The solution can’t be to drill more oil and pump more oil through the pipeline. It’s suicide.”

Lead photo: A drilling rig on Alaska's North Slope. Photo by iStockphoto.

This article has been updated to correct the details of the discovery of oil in Prudhoe Bay.