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NEWS BULLETIN

August 19, 2010 --- Vol. 16, No. 76August 2010

Exxon seeks Point Thomson pipeline right of way

PTE Pipeline LLC, an affiliate of ExxonMobil Pipeline Co., has applied for a right-of-way lease to build a pipeline to carry production from the Point Thomson field on Alaska’s eastern North Slope.

The 22-mile pipeline will link the ExxonMobil-operated Point Thomson field, now under limited development, to the existing Badami pipeline to the west.

The right-of-way application says the 12.75-inch Point Thomson pipeline will cost about $80 million to build, with annual operating and maintenance costs of $12 million. Construction is to begin in late 2011 with completion projected for 2014.

The pipeline will be cross state land along the Beaufort Sea coast, and will be elevated above ground on vertical support members. The line will be designed for a throughput of 70,000 barrels per day.

The pipeline will feature increased wall thickness in areas where a high potential exists for accident bullet strikes from North Slope hunters.

“The estimated commercial life of the pipeline is 30 years,” the application says.

ExxonMobil has drilled, but not completed, two wells at Point Thomson, and has said it intends to begin production of 10,000 barrels a day of natural gas condensate by year-end 2014.

Ultimate control of the Point Thomson field remains the subject of a legal struggle between ExxonMobil and other major lease holders and the state of Alaska.

Editor’s note: See full story in the Aug. 29 issue of Petroleum News, which will be available online to PN subscribers by noon Friday, Aug. 27, at www.petroleumnews.com.

BP to restart Badami, expects 3,000 bpd

BP plans to resume service on its eastern North Slope Badami Oil Pipeline “on or about Sept. 1,” it said in an Aug. 18 filing with the Regulatory Commission of Alaska, or RCA.

In the filing the company said “on or about” Sept. 1 it will “begin providing line-fill” to the pipeline “via a slipstream from the Endicott Pipeline,” which connects the Badami line that carries Badami unit production to central North Slope facilities for processing and transport down the 800-mile trans-Alaska oil pipeline.

“Upon completion of filling the Badami Pipeline it will begin shipping oil produced at the Badami unit on or about Sept. 5”. The total daily amount of oil to be shipped “is expected to be approximately 3,000 barrels per day,” BP said in its RCA filing.

BP shut down Badami in August 2007, the most recent attempt to recharge reservoir pressure and subsequently improve production rates by leaving the field fallow a while. Nearly two years ago, independent Savant Alaska began partnering with BP to bring the field back online and has since drilled at Badami in the past two winters.

In February, Savant said it planned to restart the Badami plant by September, as well as resume production from some existing wells in the unit, and test the two wells it drilled itself: the B1-38 (Red Wolf) exploration well and the B1-18 sidetrack well.

Upon restart, BP has said it anticipated some five or six producing wells at Badami, which sits along the coast of Mikkelsen Bay, east of the Prudhoe Bay unit.

Editor’s note: See full story in the Aug. 29 issue of Petroleum News, which will be available online to PN subscribers by noon Friday, Aug. 27, at www.petroleumnews.com.

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