March 04, 2008 --- Vol. 14, No. 29March 2008

DNR presses oil companies on Point Thomson commitment

During the first day of the Alaska Department of Natural Resources Point Thomson hearing, state officials pressed ExxonMobil, Chevron and BP on their commitment to carrying out the proposed 23nd plan of development for Point Thomson. The hearing is being held in response to a directive by the Alaska Superior Court.

In their hearing testimony, executives from ExxonMobil, Chevron and BP said the plan contained a clear timeline of activities that would lead to Point Thomson production by 2014. That plan is different from earlier plans in that it commits the companies to put Point Thomson into production, the executives said.

But DNR Commissioner Tom Irwin and Nan Thompson, petroleum manager for Alaska’s Division of Oil and Gas, asked the executives for evidence of that commitment to act on the plan.

“Given the history of this unit, DNR is skeptical about whether ExxonMobil will follow through on the plan. …Why can DNR rely on ExxonMobil’s commitment now?” Irwin asked ExxonMobil Production Manager Craig Haymes.

Haymes said that the state would be able to monitor progress against a plan that all of the oil companies involved fully supported.

“This timeline is collectively supported and committed to by all of the owners. … The plan of development lays out a very detailed, descriptive foundation to monitor progress,” Haymes said. ”… This allows us to monitor progress collectively … and allows us to very easily see a number of different milestones very early in the program.”

ExxonMobil has already secured a drilling rig for the Point Thomson project and plans to commence Point Thomson drilling in the winter of 2008-09 Haymes said.

The oil company executives also said that they have modified the unit and area operating agreements for Point Thomson so that decisions require approval only by a simple majority — that would prevent a single owner from vetoing a decision. The revised agreements also contain language that protects the project schedule, Kevin Brown, BP’s manager of gas business development, told the hearing.

BRPC plans to sidetrack Tofkat

Brooks Range Petroleum Corp. plans to sidetrack the Tofkat No. 1 well based on initial drilling results, according to the joint venture running the drilling program.

As operator of the program, BRPC reached a total vertical depth of 7,703 feet on Tofkat No. 1, located along the eastern shore of the Colville River near the village of Nuiqsut. During the drilling, BRPC came across several zones with “indicated hydrocarbon potential.”

The sidetrack will begin after initial logging and testing of the well.

The company plans to release further information by the end of the month.

BRPC, a wholly owned subsidiary of the Alaska Venture Capital Group, is running its winter exploration program on behalf of a joint venture with TG World Energy Corp., the Nabors subsidiary Ramshorn Investments Inc. and Bow Valley Alaska Corp.

“While various test must be undertaken and the results of those tests analyzed before we are able to draw any conclusions concerning commerciality, we are encouraged with the indications of hydrocarbons noted during the drilling process,” said Clifford M. James, president and CEO of TG World Energy Corp., in a prepared statement.

January to February ANS production steady

Alaska North Slope production for February averaged 730,727 barrels per day, basically level with January’s 730,337 bpd, up just 0.05 percent.

Three fields had slightly increased production, February over January: Production was up 3.5 percent at Endicott, averaging 47,295 bpd; Prudhoe Bay averaged 327,444 bpd, up 1.8 percent; and Kuparuk River averaged 150,618 bpd, up 0.8.

Production dropped at other North Slope fields. At an average of 33,410 bpd in February, Northstar was down 0.1 percent; Alpine averaged 105,165 bpd, down 4 percent; Lisburne averaged 34,101 bpd, down 4.2 percent; and Milne Point averaged 32,694 bpd, down 6.5 percent.

Editor’s note: See complete stories in March 9 issue of Petroleum News, available to subscribers online at noon Friday, March 7, at

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