Santos Reaches Continuous Production at Pikka, Adding 20,000 bpd to Alaska North Slope
Santos has hit continuous oil production at its Pikka project, ramping toward 80,000 bpd plateau output in the third quarter.
Santos Ltd said on Tuesday (2026-06-23) that the Pikka oil development on Alaska's North Slope has reached continuous production, with the first wells now delivering 20,000 barrels per day gross. The startup, which began earlier this year, marks the first crude flowing from a project the Australian producer has pushed as a cornerstone of its oil expansion strategy.6
The milestone matters because Pikka carries 80,000 bpd gross of planned plateau output, targeted for the third quarter of this year. For Santos, the ramp-up is central to a production outlook that has already been trimmed once, with the company narrowing 2026 guidance from 101-111 million barrels of oil equivalent to 99-105 MMboe even as Barossa and Pikka both work through their initial phases.8
Santos operates the Pikka Unit with a 51% stake. Spain's Repsol holds the remaining 49%. The partners expect the project to build from its current 20,000 bpd over the next few weeks before reaching the 80,000 bpd gross plateau, a target that will test the North Slope's infrastructure and the operator's ability to manage a cold-climate ramp.4
The Alaska push is part of a broader strategic pivot announced in late May (2026-05-26), when Santos told investors it would prioritise growth in crude oil and natural gas production both at home and abroad. The company's LNG strategy will focus on Alaska, Papua New Guinea and the Beetaloo and Bedout basins domestically, with management describing those tier-1 basins as providing scale and hub economics.4,5
That strategy comes with execution risk. Santos has described 2026 as "a transition year" with two major projects ramping simultaneously, and the revised output guidance reflects the operational friction of bringing both Barossa and Pikka online. The company reported a 1.8% drop in first-quarter sales revenue on Thursday (2026-05-14), hurt by a temporary outage at the Barossa offshore gas project and a severe tropical cyclone on Australia's west coast.8,1
Shareholders have so far looked through the operational noise. Santos stock traded around A$7.89 in early May 2026, up roughly 12.9% over the prior 90 days and about 28.3% year-to-date, according to market data compiled by Simply Wall St. The shares took a 3.3% hit on Thursday, May 7, 2026, but the longer-term trend reflects investor appetite for the LNG and oil growth story.3,2
Beyond Alaska, Santos is also advancing its Papua New Guinea position. The company said on Tuesday (2026-05-12) it will proceed with the Agogo tie-in project after approval from the PNG LNG joint venture, in which it holds a 39.9% stake. That brownfield project will link the Agogo Production Facility to the existing PNG LNG pipeline via a new 19-kilometer line, two wells and facility modifications, at a net cost of about $160 million.4,1
The Agogo work is expected to add around 135 million cu ft daily of production capacity, with Santos' net share at roughly 54 million cu ft. Gross capital expenditure is estimated at $400 million over three years.4
Australia's regulatory climate adds another layer of uncertainty. Santos' chief executive said on Tuesday (2026-05-12) that a proposal to impose a 25% gas-export tax has damaged the country's reputation as a stable destination for energy investment, a signal that could complicate future domestic project approvals even as Queensland pushes streamlining legislation.1,7
The Pikka ramp is now the nearest-term test. Reaching continuous production is one thing; sustaining an 80,000 bpd plateau through an Arctic winter is another. Traders and analysts will be watching the third-quarter numbers for evidence that the wells are holding up, and for any further adjustment to Santos' full-year guidance as Barossa and Pikka mature.6,8