NEWS BULLETIN

February 04, 1999 --- Vol. 5, No. 6February 1999

BP suspends production at Badami

BP Exploration (Alaska) Inc. said today that it is temporarily suspending production from the Badami field to perform well work and to collect and analyze additional reservoir data.

BP said that timing of the suspension was dictated by extreme low temperatures on the North Slope and that it plans to resume production in several months on completion of the evaluation program.

Octavio Pastrana, head of BP's eastern North Slope business unit, said in a statement that: "This 'time out' will give us an opportunity to enhance our understanding of the reservoir."

"Badami has a very complex reservoir. We still believe in Badami's potential, but we need a much better understanding of reservoir characteristics in order to realize that potential," Pastrana said.

BP said that operators will remain on site during the suspension to maintain equipment, perform well work and gather additional reservoir data from the wells.

BP spokesman Paul Laird told PNA that the pipeline and facilities will be purged with natural gas after oil production is suspended. The wells, he said Thursday morning, are scheduled to be shut in this afternoon. Purging with gas will occur over the next few days.

Eight wells have been drilled at Badami, Laird said, and a ninth was in the process of being drilled when the rig had to be moved out to BP's Red Dog exploration well. Once work at Red Dog is completed, he said, the rig will be moved back to Badami and the ninth well will be completed. The exploration well at Red Dog has been spud, Laird said (see page 2 item on winter exploration wells).

Badami is about 35 miles east of the Prudhoe Bay oil field. It started producing in late August and has produced less than 500,000 barrels of oil, Laird said. BP has a 70 percent interest in Badami and is field operator. Petrofina Delaware holds a 30 percent interest.

Corps releases FEIS for Northstar

The U.S. Army Corps of Engineers said Feb. 3 that it will release the final environmental impact statement for the Northstar oil and gas project on Friday Feb. 5.

An executive summary, or a complete set of eight volumes of the final EIS may be requested by calling 907 753-2712 in Anchorage. The Corps said that libraries and public agencies throughout the state will have the final EIS eight-volume set for public use.

Comments on the eight-volume document will be accepted for 30 days. All public comments must be received in the Corps' Anchorage office no later than March 8.

The Corps will prepare a record of decision after the comment period closes to determine whether the permit should be issued, denied or issued with conditions. The decision will consider public and resource agency comments and a wide range of public interest factors.

The Corps said that no specific date can be given for completion of the record of decision as it cannot forecast the quantity or detail of resource agency and public comments or the time required to consider those comments. The Corps said a generalized estimate of a minimum of 30 days is normal in many circumstances.

The Northstar project is a proposal of BP Exploration (Alaska) Inc., which funded the preparation of the EIS by a third-party contractor, Dames and Moore Inc. The Corps of Engineers is the lead agency for the EIS. Cooperating agencies include the Environmental Protection Agency, National Marine Fisheries Service, U.S. Fish and Wildlife Service, Minerals Management Service and the North Slope Borough.

Northstar would be the first offshore production facility in the Alaska Beaufort Sea connected to shore by a subsea pipeline. BP has estimated the development could produce approximately 150 million barrels of oil.

Exploration wells in permitting process

Drilling permits have been issued for two North Slope winter exploration wells, Red Dog and Meltwater South, and applications for three more are in the works.

The lone east side exploration well, Red Dog, was permitted by BP Exploration (Alaska) Inc. in early January. The well will be drilled from a surface location between the Badami and Point Thomson units on the eastern side of the North Slope to a bottomhole location offshore under the Beaufort Sea.

On the western side of the North Slope, ARCO Alaska Inc. received a drilling permit for its Meltwater South well in late January, and has drilling permits for three other wells in the works.

The Meltwater North well is proposed for a location north of the Meltwater South - the wells are south of ARCO's new Tarn development on the western edge of the Kuparuk River field.

Two Fiord wells, no. 4 and no. 5, are proposed northeast of the Alpine field. ARCO said earlier in other permit applications that the wells would be reached from a sea ice road being built to move a rig to the Alpine field.

Drilling permits have not yet been issued for the Fiord and Meltwater North wells.


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