Resource uncertainties
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Houseknecht reviews knowns, unknowns of new Nanushuk/Torok oil play
Alan Bailey Petroleum News
Recent major new oil discoveries in the Nanushuk and Torok formations on the North Slope have included the Pikka discovery being pursued by Oil Search and its partners; ConocoPhillips’ Willow discovery; and the oil discovery by Caelus Energy Alaska at Smith Bay. But what is the nature of these discoveries, and how much potential is there for further major finds in these exciting new plays?
On Nov. 14, during the Resource Development Council’s annual conference, Dave Houseknecht, a U.S. Geological Survey expert on northern Alaska petroleum geology, talked about what is known about the discoveries and what this may mean in terms of the potential for further major oil finds.
Houseknecht said that USGS has estimated that there may be more than 8 billion barrels of undiscovered, technically recoverable oil in the new Nanushuk and Torok plays, but that many unknowns remain at this stage in the exploration and development of the plays.
“The bottom line here is that we estimate that there’s a lot of oil in these plays,” Houseknecht said. “However, we have a large uncertainty range around that.”
An optimum location A north to south cross-section of the subsurface in the region of the plays shows, in general terms, how the plays work. Three major oil source rocks - the Shublik formation, the lower Kingak formation and the Pebble Shale/gamma ray zone - are all present in the subsurface, below the Nanushuk/Torok reservoir rocks. The subsurface zone in which temperatures have reached levels conducive to the generation of oil intersect those source rocks. And the Barrow Arch, a major geologic structure in the subsurface, provides a focus for oil to migrate upwards into reservoir rock formations.
At the same time, the Nanushuk and Torok occupy a huge fairway across the region, with rocks formed from detritus from an ancient region, now part of Russia, poured into an ancient marine basin under what is now the North Slope.
“So the fairway that the Nanushuk and Torok formations lie in, in this favorable position, is up to about 80 to 100 miles wide, north-south, and extends for at least that far, and probably much farther east-west,” Houseknecht said.
Intricate system Looked at in more detail, the Nanushuk and Torok form an intricate system, characterized by the west to east migration of an ancient marine shelf margin, with sediment from river deltas pouring onto the top of the shelf during periods of relatively high sea level, and spreading over the basin floor as relatively thin sand layers, or turbidites, at other times. Reflections in a west to east seismic section show “snapshots” of the shelf margin at various times during its migration, with the Nanushuk towards the top of the margin, and the Torok at the base.
Within this general picture, there are detailed complications. For example, seismic data indicate that the Pikka and Willow reservoirs, while both in the Nanushuk, were formed in different settings: While the Willow reservoir is a “high stand” sand body, laid down at the top of the shelf margin, the Pikka sands appear to have been deposited a bit lower on the shelf margin, during somewhat lower sea level, Houseknecht said. However, this interpretation is based on seismic data available to the USGS, and may be subject to different interpretations, based on other data, he cautioned.
Amplitude anomalies Seismic data can also provide other insights in the form of what are referred to as amplitude anomalies, zones of unusually high seismic amplitudes that can be indicators of the presence of hydrocarbons in the rocks. These anomalies become prime targets for exploration drilling. And there are quite a number of anomalies in the Nanushuk that have not yet been drilled but which have provided a basis for USGS scientists to make estimates of possible undiscovered resources.
Houseknecht described one undrilled anomaly, to the west of where drilling has taken place to date. This anomaly occupies an area of about 44 square miles and could hold something in the range of 200 million to 400 million barrels of recoverable oil.
But there is much uncertainty. There are many untested seismic anomalies, but no-one knows how many of these anomalies have the potential to yield economically viable discoveries. Even in the discoveries that have already been made, there will be significant uncertainty over recoverable volumes until horizontal wells are drilled through the reservoirs and production procedures are put in place, Houseknecht said.
Reservoir quality The impact of reservoir quality on oil recoverability is also an issue. Oil reservoirs in both the Nanushuk and the Torok are in the form of what are called stratigraphic traps, hydrocarbon traps formed as a consequence of the manner in which the sediments were deposited, rather than as a consequence of later folding and faulting of the rock strata. With the Torok being buried more deeply and slightly before the Nanushuk, the reservoir quality in the Torok is typically poorer than in the Nanushuk. And reservoir quality in the Nanushuk tends to deteriorate north to south, Houseknecht said.
Given the reservoir quality comparisons, and given the locations of Nanushuk and Torok discoveries, Nanushuk stratigraphic traps will probably be the main driver for further exploration, with exploration of the Torok being more limited to areas close to existing oil infrastructure - access to infrastructure can help mitigate reservoir quality risk, Houseknecht suggested.
Access to the prospects may also be an issue. The more westerly part of the National Petroleum Reserve-Alaska was open to oil and gas leasing a number of years ago but has since been withdrawn. Currently, it is difficult for a company to access the plays if that company is not already a leaseholder in areas that remain open, Houseknecht commented.
Upping the assessment However, the new discoveries in the Nanushuk and Torok have triggered a major change in the USGS assessment of undiscovered oil in the NPR-A. As recently as 2010 the agency published an assessment that particularly focused on the oil potential in Alpine sands, analogous to the reservoir sands in the nearby Alpine oil field. At that time, recent exploration drilling had indicated that moving west, within 20 to 25 miles of the Alpine field, hydrocarbon traps tended to contain a preponderance of gas and condensate, rather than oil. As a consequence, lease holdings in the region dropped substantially and the USGS downgraded its NPR-A oil expectations, Houseknecht said.
However, the recent Nanushuk and Torok discoveries have upended that gloomy view, causing the USGS to significantly increase its NPR-A undiscovered oil estimates. But major uncertainty remains over exactly how much oil is there, Houseknecht cautioned.
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