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Arctic Directory: Alaska’s offshore is different One of the biggest differences is the Arctic has shallow, not deep water Tom Irwin Commissioner, Alaska Department of Natural Re
Oil and gas land owned by the State of Alaska—both onshore and offshore—is still open for development! With all the attention given to offshore drilling in the past year, it is important to realize the regional differences associated with offshore exploration and drilling. Alaska is, as so often the case, different. In some ways, the punishing Arctic climate is a challenge, but in other ways, it provides a distinct advantage to exploration and development compared to what is needed for deepwater offshore oil and gas plays.
There are a number of differences between drilling in Alaska’s Beaufort and Chukchi Seas from drilling in the Gulf of Mexico. Some are environmental and operational, while others are attributed to differences in climate. There are also differences in the oversight and regulatory processes, as well as fundamental contrasts in the geology of the regions, all of which merit consideration while making policy decisions.
Shallow water in Alaska’s Arctic Among the most important environmental factors are water depth, geology and the seasonality of drilling operations. Producing fields such as Endicott, Northstar and Oooguruk in the Beaufort Sea tap offshore reservoirs with extended-reach directional drilling from stable, man-made gravel islands; these are in many ways akin to onshore operations.
Beaufort Sea state waters and large parts of the federally managed Outer Continental Shelf, OCS, are very shallow, with water depths ranging approximately 0-65 feet (0-20 m). Nearly all the historically leased acreage in the Beaufort Sea OCS planning area lies in waters inboard of the 330 ft (100 m) depth contour and all current leases in the Chukchi Sea are in water on the order of 130-160 feet (40-50 m) deep. Contrast this with the deepwater setting of the Gulf of Mexico, where drilling regularly taps prospects beneath waters more than 5,000 feet (1500 m) deep.
The significance of this water depth difference cannot be overstated. Despite the cold ocean water temperatures, human dive teams are able to operate directly on the seafloor in many places in offshore Alaska, whereas highly specialized remotely operated vehicles are required to investigate and respond to incidents at the seabed in deepwater Gulf of Mexico operations.
Many Alaskan offshore operations are seasonal, whereas Gulf of Mexico operations continue year-round. Some Alaskan exploration prospects are better drilled in the winter from bottom-founded drilling caissons or man-made ice islands, both firmly anchored to the seabed throughout the drilling season. Other Alaskan prospects are drilled from floating drill ships or jack-up rigs in the open water of late summer. These drilling projects commonly include ice-breaker support vessels to manage floes of multi-year ice that may sometimes approach the drilling well and occasionally interrupt operations by forcing the rig to move off location. This is in some ways analogous to the brief storm delays that affect offshore rigs in the Gulf of Mexico every year.
Special stipulations are strictly enforced in winter and summer operations in the Alaskan Arctic to minimize hazardous activities during the broken ice season, when spill cleanup would be the most challenging.
Geology differs significantly Finally, the geology of Beaufort and Chukchi seas petroleum systems differs from those of the Gulf of Mexico in important ways. Much of the Gulf of Mexico is a region marked by rapid and recent deposition of alternating sands and muddy sediments that, with deep burial and compaction, lead to strongly over-pressured pore fluids. Deep drilling in such environments is especially difficult because the high drilling mud densities required to control overpressures can fracture the formation causing catastrophic losses of drilling fluids that can trigger a blowout. The geologic setting of the Alaskan offshore is very different, marked by less recent and less voluminous sedimentation, and dangerous overpressures are not believed to be widely present.
Although concerns regarding blowout prevention equipment are certainly justified, Alaska has a long and proud record of safe oil and gas drilling. In large part, this is because of a regulatory framework based on an extensive and specialized knowledge of the Alaska drilling environment and the proactive assistance provided by regulators to explorers and developers to manage risk.
Alaska’s Oil and Gas Conservation Commission, AOGCC, exercises regulatory oversight of wells drilled in Alaskan state waters, including regulation, permitting, and inspection of wells and equipment. Originally a part of the state’s Division of Oil and Gas, the AOGCC was separated out as its own independent quasi-judicial agency within the executive branch. This separation helped alleviate potential conflict between the state’s revenue interests in achieving total ultimate recovery on state leases, with the equally important conservation interest of ensuring the most prudent oil field practices are routinely performed. This division of responsibilities on the state level was recently mirrored in the reorganization of the federal Minerals Management Service into two agencies.
Blowout prevention equipment A substantial part of the state’s oversight efforts are created to ensure that the blowout prevention equipment is never needed. All other aspects of drilling have been planned appropriately and in a way that functions optimally in the specific drilling environment.
The first line of prevention is drilling fluid. AOGCC’s geologists review the state’s database of geologic information to identify any potential strata penetrated by a suggested well where a potential flow could occur. The drilling procedure is then reviewed by an AOGCC engineer to ensure the planned drilling fluids are appropriate for the anticipated pressure.
The second line of prevention is well design. The state mandates appropriate pipe sizes and setting depths, as well as cement formulas and volumes, to provide a barrier to flow from rock formations behind pipe.
Finally, AOGCC requires confirmation that good oil field practices will be followed throughout the operation before granting any drilling permit.
Rigs are inspected by an AOGCC inspector before being brought into service, and while in service, their blowout preventers and other safety equipment are tested every 14 days (every seven days for exploratory wells) to ensure proper performance. AOGCC inspectors personally witness about 25 percent of these tests. If a blowout preventer fails a test, drilling operations will be suspended until it passes.
Alaska holds tremendous resources. Our state is estimated to hold 18 percent of total U.S. oil reserves. At a production rate of 640,000 barrels per day, Alaska is currently responsible for 12.21 percent of U.S. oil production. Developing Alaska’s resources is good for the state and for the United States. Oil production from the aging fields on the North Slope, which have provided our country with a steady stream of oil since 1977, is declining.
The offshore resources in Alaska’s state waters are an important part of the country’s energy future and are needed to stem the decline of domestic oil and gas production. As Alaskans, we rest assured that the expertise our agencies possess, and the regulatory framework this expertise has created, and continues to create, will be appropriate and sufficient for us to invite prudent operators to produce our hydrocarbon resources while protecting our other natural resources.
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