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Plan of operations submitted for Katalla southeast of Cordova
Kristen Nelson
Cassandra Energy Corp., as agent of Chugach Alaska Corp., has submitted a plan of operations to the Cordova Ranger District-Chugach National Forest for oil and gas exploration at Katalla.
The Forest Service said Aug. 27 Cassandra is requesting approval of a plan of operations and a special use permit to conduct exploratory drilling for oil and gas in the Katalla area of the East Copper River Delta and that an environmental analysis will be conducted.
The proposed drilling area is 56 miles southeast of Cordova. Drilling on private lands Drilling would be on private land, with lateral drilling extending into reserved oil and gas rights underlying public lands.
The proposal includes moving equipment, supplies and materials up the Katalla River with a shallow draft barge to a staging area of approximately two acres on National Forest lands.
Approximately one-quarter to one-half mile of new road construction would be required from the staging area to an existing 2.5 mile access road across National Forest lands.
The Forest Service said that one exploratory well would be drilled vertically to explore the subsurface of Katalla Claim 1. The other exploratory well would be drilled laterally from the drill site to explore Chugach Alaska’s rights under a 1982 agreement. 1982 agreement The Forest Service said that its agreement with Chugach Alaska Corp. requires approval of a plan of operations and completion of an environmental analysis. The Katalla oil and gas area is defined in the 1982 CNI, Chugach Natives Inc., settlement agreement, which gives CNI the exclusive right, conveyed through the Secretary of the Interior, to drill for, mine, extract, remove and dispose of all oil and gas deposits in a liquid or gaseous state, from the date of signing of the CNI agreement (Sept. 17, 1982) until midnight Dec. 31, 2004, “and so long thereafter as oil and gas are produced in paying quantities.”
The agreement covers approximately 10,134 acres. If a well capable of producing in paying quantities within the Katalla area has not been completed by midnight Dec. 31, 2004, all right, title and interest of CNI reverts back to the United States. Oil seeps discovered in 19th century Oil seeps were discovered in the Katalla area and on the north side of Controller Bay about 1896. In the Katalla area, the Forest Service said, the oil seeps are confined to a narrow eastward trending belt near the coast. Forty-four wells were drilled in this area between 1901 and 1932, of which approximately 18 wells produced oil.
The producing wells were within an area of approximately 60 acres and produced oil from fractured sandstone and siltstone of the Katalla formation at depths ranging from 360 to 1,750 feet. Most of the productive wells were on the Katalla Claim 1 patented under the placer mining law prior to the enactment of the oil and gas leasing law.
Recorded production in the Katalla area amounted to 153,922 barrels of oil over 30 years. During this period, the refinery near the Katalla field provided petroleum products for local use in Katalla. Oil production ceased in 1933 when the refinery was destroyed by fire. It was never rebuilt.
The Forest Service said that some additional exploratory work has been conducted in the Katalla area since 1950.
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