The Nikaitchuq unit will only put out about 28,000 barrels of oil per day at its peak and the Resource Development Council of Alaska says it's the last oil development that will be coming online for at least five years.
ENI-owned Nikaitchuq went online this morning. Its estimated daily throughput will only be a drop in the bucket compared to the 650,000 barrels coming through the pipeline right now. The RDC says throughput is dropping each year by 48,000 barrels per day.
The state doesn't dispute that statistic, but says Alaska is not resigned to having an empty pipeline in the next decade.
Department of Natural Resources Commissioner Dan Sullivan said the state is working to attract new producers, while at the same time working with the companies already on the Slope to expand their production.
RDC says even with other producers considering new projects, it takes years to get a drill in the ground.
So if we're not adding two to three new Nikaitchuqs every year we're going to be in serious trouble,” said RDC Executive Director Jason Brune. “And seven to 10 years from now that pipeline may not be operational.”
“The prediction of a TAPS shutdown in seven years is not an inevitable conclusion that we are accepting,” Sullivan said. “To the contrary. We're very focused on setting the conditions working in partnership with industry to try to ensure that that does not happen.”
RDC says well-known development projects like BP's Liberty would only put out around 30,000 barrels per day at its peak, when it eventually comes on line. That project has also been pushed back several years.