October 01, 2001 --- Vol. 7, No. 126October 2001

Escopeta’s Cook Inlet gas announcement raises questions

Estimates of 12 trillion cubic feet of natural gas and 1.35 billion barrels of oil near the East Forelands area of Cook Inlet by Escopeta Oil and Gas Corp. are not likely to produce a gas rush in the area any time soon, local experts say.

“Exploration results” rivaling North Slope discoveries were announced last week by Escopeta, vaulting the Houston-based independent into national headlines. The results were based on new analysis of 2D seismic data that is almost 20 years old, Escopeta said.

“It’s worth a look, but I don’t think anybody should get too excited about this,” Ken Boyd, the former director of the Alaska Division of Oil and Gas, told PNA.

If Escopeta’s estimates are correct, the gas discovery is about one-third the size of proven North Slope natural gas reserves and exceeds the total amount of gas recovered in Alaska to date.

Escopeta President Danny Davis told PNA the seismic data was reprocessed using an energy absorption technique, a new technology that identifies the existence of hydrocarbons in the target structure.

“We ran the test on this and it lit up like a Christmas tree,” he said.

Michael Economedes, Ph.D., a professor of development engineering at the University of Houston is a consultant to Escopeta on the project. He told PNA the energy absorption technique has been successfully used to re-explore and find deep natural gas structures in the transition zone in Louisiana, Texas and on the Louisiana and Texas Gulf coast.

“Energy absorption is a technique that can actually easily detect gas at great depths, 25,000 feet or more. It has opened up a huge new tool of exploration to the point that those that demand drilling for proof today look pretty much completely outdated,” he said.

The gas is estimated to be 18,000 to 21,000 feet below the surface. At those levels in Cook Inlet, several experts questioned whether the gas, if it exists, could be produced at economic rates. Mike Wilson, a Golden, Colo. petrographer who has performed numerous studies in Cook Inlet and elsewhere in Alaska said he would expect low porosity and low permeability at deep levels in Cook Inlet.

Economedes said he expected the levels of porosity in Escopeta’s structure to be 12 to 15 percent.

Wilson said that might be possible if the structure was highly over-pressurized: “Even if you’ve got good indications you need a well to prove it up.”

Davis said drilling was the next step. “Until you get a bit to the bottom, you don’t know for sure what’s there,” he said.

The major portion of the prospect lies offshore, but Escopeta said that the initial wells can be drilled from onshore locations.

Davis said the company was looking for exploration partners and would apply for drilling permits in early 2002.

Boyd said drilling the prospect would likely be very expensive.

“I wish them well but I’m not going to be in the land rush,” Boyd said. “Everybody who worked in Cook Inlet for 40 years has missed it.”

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