Today’s Key Takeaways: Bullish on Alaska’s North Slope – Willow wins! LNG drives Santos takeover bid. Kicking the critical minerals can down the road with China. Israel & Iran target energy infrastructure – oil prices respond.
OIL:
One of the North Slope’s most successful oil explorers is bullish on a new discovery
Alex DeMarban, Anchorage Daily News, June 15, 2025
The oil explorer whose last major discovery in Alaska opened a new frontier for North Slope development believes he’s sitting on another promising find in a remote area.
Geologists familiar with Bill Armstrong’s work and North Slope geology say he and his team are likely on to something.
Armstrong, who is based in Colorado, discovered the huge Pikka field on the western edge of the North Slope oil patch in 2013.
That led to additional nearby discoveries, including ConocoPhillips’ Willow field. It sparked what the oil industry in Alaska describes as a renaissance in new activity. It led to forecasts for a big turnaround in the oil flow that’s vital to state revenues. After Pikka and Willow are completed, North Slope production should rise to about 650,000 barrels of oil daily in 2033, up from about 480,000 barrels today.
Armstrong says his latest discovery, Sockeye-2, could once again attract more oil companies to a little-explored area on state land, leading to a “second renaissance.”
“If you’re a betting man, it’s happening,” he said in an interview. “It was speculative before this past drilling season. But not anymore.”
Appeals court upholds approval of Willow project on Alaska’s North Slope
Yereth Rosen, Alaska Beacon, June 13, 2025
In a split decision, the court says a flaw in the review was too minor to warrant overturning the 2023 approval for the huge oil field already under development
A federal appeals court on Friday upheld the Biden administration’s approval of a major oil development on Alaska’s North Slope, even though it identified one flaw with the action.
The 9th U.S. Circuit Court of Appeals, in a divided decision, said the U.S. Bureau of Land Management largely abided by federal laws when it granted approval to ConocoPhillips to develop the huge Willow project.
Despite one problem that the ruling characterized as “minor,” the approval shall stand, said the majority opinion, written by Judge Ryan D. Nelson.
The ruling allows ConocoPhillips to keep developing Willow, which holds about 600 million barrels of reserves and is slated to produce up to 180,000 barrels per day and be the westernmost operating oil field on the North Slope. And it rejects arguments from environmental and Native plaintiffs who said the BLM approval violated requirements for considering the cumulative and climate impacts of the huge development, impacts to endangered species and other issues.
The identified flaw stems from the BLM’s decision to approve a Willow development plan with three drill pads rather than the five ConocoPhillips had proposed. The scaled-back plan approved in 2023 also required ConocoPhillips to give up leases on about 68,000 acres, almost all of that in the ecologically sensitive Teshekpuk Lake area.
During the environmental study process that led to the approval decision, the BLM had expressed the position that it needed to consider full field development rather than piecemeal development, the ruling said. “And then when it came time to issue the final approval, it never explained whether its adopted alternative satisfied the full field development standard,” the ruling said.
But that was a “at heart, a procedural, not a substantive violation,” the ruling said. The development approval is to remain in place, the decision said. Overturning the approval is “unwarranted because the procedural error was minor and the on-the-ground consequences (of vacating it) would be severe,” the decision said.
GAS:
Abu Dhabi sets up test for Labor with $36b Santos takeover bid
Angela MacDonald-Smith, Australian Financial Review, June 16, 2025(subscription required)
Abu Dhabi’s national oil company has made a big bet on the future of gas with its bid for Santos, setting up a test for the Australian government over the ownership of assets critical for the country’s energy security. The deal would hand shareholders in Australia’s second-largest oil and gas producer almost A$30 billion in cash, but it has been met with a lukewarm reception from investors and the South Australian government, where Santos was founded 71 years ago.
Australia’s treasurer said the deal was “potentially a very large transaction” and he would listen to the advice of the Foreign Investment Review Board before deciding whether to poised to start production in the Timor Sea.
But investors are divided on the offer — even as Santos’ stock spiked as much as 15% higher. That remains well below XRG’s proposed takeover price, reflecting significant uncertainty about whether the deal will secure foreign investment clearance. “It’s fair, it’s not exceptional,” Wilson Asset Management’s Matt Haupt said of the price. Regulatory hurdles are expected to be significant, with several approvals needed from government agencies in Australia and Papua New Guinea government. Approve the sale to the consortium led by XRG, the Abu Dhabi government’s investment arm.
MINING:
US-China trade truce leaves military-use rare earth issue unresolved
Reuters, Jume 15, 2025
The renewed US-China trade truce struck in London left a key area of export restrictions tied to national security untouched, an unresolved conflict that threatens a more comprehensive deal, two people briefed on detailed outcomes of the talks told Reuters.
Beijing has not committed to grant export clearance for some specialized rare earth magnets that US military suppliers need for fighter jets and missile systems, the people said. The United States maintains export curbs on China’s purchases of advanced artificial intelligence chips out of concern that they also have military applications.
At talks in London last week, China’s negotiators appeared to link progress in lifting export controls on military-use rare earth magnets with the longstanding US curbs on exports of the most advanced AI chips to China. That marked a new twist in trade talks that began with opioid trafficking, tariff rates and China’s trade surplus, but have since shifted to focus on export controls.
In addition, US officials also signal led they are looking to extend existing tariffs on China for a further 90 days beyond the August 10 deadline agreed in Geneva last month, both sources said, suggesting a more permanent trade deal between the world’s two largest economies is unlikely before then.
The two people who spoke to Reuters about the London talks requested not to be named because both sides have tightly controlled disclosure. The White House, State Department and Department of Commerce did not immediately respond to requests for comment. China’s Foreign and Commerce ministries did not respond to faxed requests for comment.
President Donald Trump said on Wednesday the handshake deal reached in London between American and Chinese negotiators was a “great deal,” adding, “we have everything we need, and we’re going to do very well with it. And hopefully they are too.”
And US Treasury Secretary Scott Bessent said there would be no “quid pro quo” on easing curbs on exports of AI chips to China in exchange for access to rare earths.
POLITICS:
Oil Prices Surge as Israel and Iran Target Each Other’s Energy Infrastructure
Tom Kool, OilPrice.Com, June 15, 2025
Brent crude futures opened more than 4% higher on Sunday evening, trading above $77 per barrel, as tensions between Iran and Israel erupted into open military conflict targeting critical energy infrastructure. The spike follows an 8% jump on Friday, marking one of the sharpest two-day increases in oil prices in recent years.
Over the weekend, Israel launched a wave of coordinated airstrikes on Iran, hitting key energy facilities in and around Tehran. The Shahran fuel depot in northern Tehran, a vital distribution point supplying around 8 million liters of gasoline daily, was set ablaze in a series of explosions. The city’s Shahr Rey oil refinery—one of the country’s largest—was also struck, sparking massive fires and raising fears of fuel shortages in the capital.
Iran’s oil ministry confirmed the attacks and reported that at least 11 storage tanks were destroyed. The escalation represents the most destructive phase yet in the ongoing conflict and could further disrupt Iran’s already sanction-constrained oil and gas sector.
In retaliation, Iran launched drones and missiles at multiple Israeli targets, including the Haifa oil refinery. While Israeli officials claimed their military focused on “military assets,” Iran has accused Israel of deliberately targeting civilian infrastructure. The reciprocal strikes have amplified fears of a broader regional conflict, with implications for both global oil supply and pricing stability.