BRPC seeks North Shore project permits
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Company executive doesn’t see legal tussle with partner TG World getting in way of small oil development near Prudhoe Bay field
By Wesley Loy For Petroleum News
Brooks Range Petroleum Corp. is seeking a raft of permits for its small North Shore oil development on Alaska’s North Slope.
The Anchorage-based company is pursuing the permits as state officials review the project under the Alaska Coastal Management Program. The 50-day review began with a letter Brooks Range received Aug. 11 from the state Department of Natural Resources.
Jim Winegarner, vice president of land and external affairs for Brooks Range, told Petroleum News on Aug. 20 the company will continue toward development of North Shore regardless of a legal dispute with one of the company’s partners, Calgary-based TG World Energy Inc.
“We are proceeding with obtaining development permits,” Winegarner said. The company wants to be in a position, he said, to conduct more drilling at North Shore.
The project Brooks Range is planning to build a 12.6-acre gravel drilling and production pad about 3.5 miles northeast of Prudhoe Bay’s S Pad and about a mile west of the Kuparuk River. The company also wants to build a five-mile gravel access road to connect the production pad to existing roads.
The North Shore pad would be used to tap several small oil accumulations. A project description on the company’s Web site says Brooks Range expects to recover 5 to 10 million barrels of oil.
North Shore would be within the proposed Beechey Point unit, for which Brooks Range applied on April 27.
Brooks Range is seeking, among others, a permit from the U.S. Army Corps of Engineers, which regulates the filling in of wetlands. The company also is seeking transportation and other easements from the state, fish habitat permits, a land-use permit for an ice road, and a contract for mining gravel from the Kuparuk Deadarm site.
Brooks Range also is asking the state Division of Oil and Gas for approval of its North Shore lease plan of operations, and it has an Oil Discharge Prevention and Contingency Plan application out for public review.
Permitting cost tops $1 million The permitting budget overall has exceeded $1 million, Winegarner said.
Brooks Range thus far has drilled only the North Shore No. 1 well, in 2007, and could begin an oil development based on that one well provided the price of oil is high enough, he said.
But the company hopes to drill another well this coming winter, and more once the gravel pad is in place. Realistically, first oil could come in mid-2012, Winegarner said.
Because the small oil accumulations in the North Shore area don’t justify the cost of a pipeline, the company is proposing to haul the oil eight miles by tank truck to a tie-in with the Kuparuk pipeline.
Producing oil by truck is commonplace in oil fields elsewhere in the country, but not on the North Slope.
“The trucking allows you to pay as you go, basically. People are joking I’ll need to get my CDL,” or commercial driver’s license, Winegarner said.
Partner conflict Through its partnership with operator Brooks Range, TG World can take up to a 35 percent interest in the North Shore development, Winegarner said.
But relations are strained between the two companies, which have sued one another in Alaska Superior Court alleging contract breaches. TG World has raised objections to the proposed formation of the Beechey Point unit.
Winegarner told Petroleum News he believes the problems can be worked out between the two companies. Regardless, work toward the North Shore development can proceed, he said.
An attorney for TG World could not be reached for comment.
According to the court calendar, the case between Brooks Range and TG World is tracking toward trial in January.
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