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40 Years at Prudhoe Bay: Field discovery debate still rages Finding the subsurface ocean of oil known as Prudhoe Bay involved two Arctic exploration wells and spanned more than a year Rose Ragsdale For Petroleum News
Forty years after a team of explorers first drilled into North America’s largest oil field, the actual date of discovery remains a subject of debate, even among the geologists, engineers and others who participated in the world-changing event.
The problem is that Prudhoe Bay’s discovery, like most great endeavors, didn’t happen in a moment of brilliant inspiration. Instead, it took months of gritty toil, frustration and uncertainty to unleash the elephant locked beneath Alaska’s North Slope.
“It was about as exciting as watching a tree grow,” recalled John Sweet, then district explorationist for Atlantic-Richfield Co.
Pivotal event in question Sweet, who was an integral part of the Prudhoe Bay discovery team, said he is convinced the Prudhoe Bay oil field wasn’t actually discovered until the Sag River No.1 well was drilled in the summer of 1968.
“The first well provided the leadership, but if that had been all we’d found, it would not have been commercial,” Sweet told Petroleum News.
H.C. “Harry” Jamison, then ARCO’s Alaska exploration manager, disagrees. Jamison, who led the Prudhoe Bay discovery team, said the oil field’s date of discovery was the date the well was completed.
Alaska Oil and Gas Conservation Commission records show that date as June 24, 1968.
“I’ve worked all over the United States, and I’ve always heard that conventional wisdom is that the date of discovery is the date the well was completed,” Jamison said. “Otherwise, you’ll get dates all over the place. One guy will say, ‘It was when we got first oil shows,’ another one will say, ‘It’s when we first hit the Sadlerochit (formation), and another will say, ‘No, it’s when we drilled the Mississippian.’ You get the idea.”
People, in fact, can’t even agree on the year in which the oil field was discovered. Some still say it happened in 1967, though most people point to 1968.
Getting a decision to drill The discovery chronology was complicated by many factors, including the harsh working environment and the constraints on drilling during the Arctic summers.
In retrospect, the Prudhoe Bay well has been described as a last ditch effort as the entire oil industry, smarting from the expense and disappointment of 14 dry holes, seemed ready to abandon the North Slope as a frontier for petroleum exploration.
ARCO and Humble Oil Co. pooled resources to drill the Prudhoe Bay State No. 1 well in April 1967, after the daunting failure of the Susie No. 1 well to the south and an impassioned plea to try again from then Gov. Walter J. Hickel.
C.G. “Gil” Mull, who “sat on the well” as a geologist for Humble Oil during the Prudhoe Bay field’s discovery, said ARCO’s exploration department unanimously voted to drill in the Prudhoe Bay structure.
Number-crunchers in the Dallas headquarters, however, were skeptical.
They reportedly asked Louis Davis, ARCO’s vice president of exploration in North America, to commit to the well producing at least 500 barrels per day of crude before they would agree to the project.
Davis subsequently told colleagues that he had no idea what Prudhoe Bay State No. 1 would find, but he quickly assured the accountants that the well would produce at least 500 barrels per day.
E. M. “Mo” Benson Jr., who was Harry Jamison’s boss and the ARCO executive who reported to CEO Robert O. Anderson on the North Slope project, told author Gene Rutledge in the 1980s that a major factor in convincing skeptics in Dallas was a provision in the contract that the company had negotiated for a rig to drill the Susie No.1 well.
Benson said the rig’s owner, Loffland Bros., required ARCO to pay the cost of shipping it back to Fairbanks. He said ARCO President Thornton F. Bradshaw argued that since the rig was already on the North Slope, ARCO could essentially drill a second well for relatively little additional cost.
“According to Brad, he used that argument to support drilling the Prudhoe Bay State No. 1 since, in effect, he considered it a free well as we would have had to spend the same money to fly the rig out in lieu of drilling,” Benson said.
“Be that as it may, Bob Anderson’s support never wavered. My personal role in the decision to drill Prudhoe Bay was purely in support of the exploration people who were enthusiastic about the prospect,” he said.
Benson said the list of those who supported drilling at Prudhoe Bay included Rollin Eckis, former president and former exploration manager of Richfield, Mason Hill and the entire Alaska exploration staff of Richfield as well as the exploration staff of Atlantic Refining, including Julius Babisak, the exploration manager.
All of the persuasion apparently worked.
“The location of the Prudhoe Bay State No. 1 well and of the confirmation well, Sag River State No. 1 were picked by our explorationists, including Harry Jamison, a geologist and Alaska district manager of ARCO,” Benson told Rutledge.
Benson said others involved in selection of the well sites included former Richfield Chairman Charles S. Jones, Ben Ryan, Charlie Selman, Bill Bishop and Bob Specht from the Richfield side and ARCO Vice President of Exploration Louis F. Davis, James A. Savage, chief geologist and John A. Thomas, chief geophysicist as well as Marvin Mangus, John Sweet and Don Jessup on the Atlantic Refining side.
The opinions of all of these professionals came together when drillers spudded the Prudhoe Bay State No. 1 well April 22, 1967. After a couple of weeks, ARCO shut down the well for the summer due to breakup conditions.
The explorers re-entered the well in November 1967, and soon had small oil shows in drill cuttings from thin sandstones in the upper part of the well in late November and early December 1967.
Early oil shows encouraging “This, however, is not uncommon on the North Slope; almost all wells drilled there encounter some shows in the Cretaceous sandstones, thus seeing small oil shows in this part of the section was not particularly significant,” Mull said.
On Dec. 8, 1967, a drill stem test run on an interval of thinly inter-bedded Cretaceous age sandstones and shale from 6,876 feet to 6,998 feet deep flowed with some natural gas and recovery of a few barrels of oil from the drill pipe, though no oil flowed to the surface.
“This was an encouraging sign, but again not terribly significant, because other wells previously drilled on the North Slope also had recovered small amounts of oil from rocks of Cretaceous age — those deposited some 65 million to 140 million years ago,” Mull said.
On Dec. 27, 1967, the explorers encountered strong gas shows during drill stem test No. 2 in the Triassic Ivishak Formation of the Sadlerochit Group, and the well flowed with a high volume of gas, which marked a significant gas discovery.
Mull said this was the first significant production of hydrocarbons from what has become the main reservoir of the Prudhoe Bay field, but no oil was encountered in this part of the section.
Eyewitnesses recall that the gas rushed out of the well roaring like a jet engine with such force that it shot 50 feet into a 35-knot wind.
After drilling resumed Feb. 1, 1968, oil shows were seen in the drilling mud and in cores from the lower 40 feet of sandstones in the Sadlerochit Formation, but were not evaluated until logs were run on Feb. 8, 1968.
“Evaluation of these logs along with the core data indicated that the formation had sufficient porosity and contained enough oil that it could be considered a discovery,” Mull says.
Field discovery announced ARCO sent out a news release Feb. 16, 1968, announcing the discovery of oil, though no flow tests had been conducted.
Two days later, the explorers conducted drill stem test No. 3 in the top of the Lisburne limestone. It flowed with a large amount of gas and an estimated 100 barrels per day of oil, but at least part of this oil and gas flow probably came from the overlying Sadlerochit Formation rather than the Lisburne, according to Mull.
The first actual measured oil flow from the Prudhoe Bay well came in Drill Stem Test No. 5 in the Lisburne on March 12, 1968. It measured the flow at 1,152 barrels per day of oil and produced headlines March 13, 1968.
“However, this oil was produced from Lisburne limestone and dolomite that underlies the sandstone and conglomerate of the Sadlerochit Formation, and showed that there are multiple reservoirs in the Prudhoe Bay area,” Mull said. “This had the effect of increasing the likelihood that the Prudhoe Bay field could be economically viable.”
By May 1968, several drill stem tests had measured the flow of oil from several intervals in the Sadlerochit Formation.
About a month later — June 25, 1968 —explorers drilling the Sag River State No. 1 well encountered oil in the Sadlerochit Formation, seven miles away and 400 feet deeper than crude found by Prudhoe Bay State No. 1.
On July 18, 1968, ARCO and Humble announced that the Prudhoe Bay field probably contained 5 billion to 10 billion barrels of recoverable oil.
Support for winter discovery So when was the Prudhoe Bay oil field discovered?
“As you can see, there was a succession of events that built to the realization that the Prudhoe Bay State No. 1 well was a commercial discovery,” Mull said in a letter to author Gene Rutledge in 1998. “But, if I had to pick a date at which one could say that oil was discovered in the Prudhoe Bay field, I would pick Feb. 1, 1968, when the first oil saturated sandstone was encountered in what has become the main reservoir in the field.”
Not so, says Marvin Mangus, ARCO’s well geologist for Prudhoe Bay State No. 1.
“Oil was discovered at Prudhoe Bay in December 1967,” Mangus told Petroleum News. “We decided not to make it known until we drilled the confirmation well. So, the top brass decided to hold off making the announcement until February 1968. But all of us on the well had decided that we had something. It should have been right around Christmas 1967.
“You just don’t have oil shows that big unless it’s really good. We felt that it was a discovery,” Mangus said.
Frigid weather hampered progress Garnett “Gar” Pessel, a geologist who worked in ARCO’s geophysical department at the time on core samples coming in to Anchorage from Prudhoe Bay State No. 1, said one possible reason for the conflicting views on the discovery date was the huge amount of uncertainty that loomed over the operation that winter. Frigid temperatures caused equipment to malfunction and bogged down the pace of exploration.
“During the early testing, the engineers were unfamiliar with working in the cold. The equipment kept freezing up and giving bogus results, and the guys kept arguing about it,” Pessel said. “But Don Jessup, the district geologist for ARCO kept looking at the cores and getting excited.”
Sweet agrees that the cores looked promising. “I had never seen oil shows like that before in my whole career,” he told members of the Alaska Geological Society at its annual technical conference in April 2008. Still, those tantalizing glimpses of something big did not an economic discovery make, according to Sweet.
Geologists aimed for Lisburne Part of the problem was that the initial target for the Prudhoe Bay well was the Lisburne Formation. However, Richfield geologists had been eyeing the Sadlerochit Formation since doing field work in the Brooks Range in the early 1960s, Mull said.
In fact, when Susie No. 1 reached its projected total depth in the Jurassic Kingak at 13,500 feet and ARCO and Humble’s geologists flew to Barrow to telephone in their report, they made a pitch for “taking the Susie well on down another 2,000 feet or so to the Sadlerochit to see what it looked like,” Mull said.
A lack of casing at the well site prompted company executives to “wisely” nix the idea, he said.
Dramatic breakthrough At 8,700 feet, the drillers got 150 barrels per day of oil, but when they dipped below 9,500 feet, gas flowed for 3 minutes and oil at 1,152 barrels per day , Sweet said.
The period was frustrating because the oil shows were in shale with very little sandstone. After the drill bit penetrated other formations in the well, it reached the Sadlerochit formation at 8,200 feet.
“The drill had been progressing at a foot an hour,” Sweet recalled. “When it hit the Sadlerochit, the drill rate went … to about a foot a minute. We ran a test and we had gas to surface at 1,250 Mcf/d.
“On Feb. 4, 1968, we reached … part of the Sadlerochit and what came out was aggregate, loose sand and oil, some of which ran through the rig floor.
“I received a core analysis on Feb. 7, and it was one of the most dramatic things you’d ever want to see. With that we made the first reserve calculations,” he said.
Incredible signs, caution Sweet said those first calculations were based on reservoir characteristics such as porosity upward of 30 percent, permeability in Darcies up to 3 (when permeability in oil fields is usually expressed in millidarcies) and 65 percent oil saturation. Sweet’s figures yielded 223 barrels per acre foot with 20 sections of proven, 17 sections of probable and 33 sections of possible crude reserves for a total of 2.3 billion barrels of oil. “That’s the number we called in to Dallas,” he said.
“In March 1968 what we had was an unbelievable reservoir, a little oil value but with good flow of oil and lots of gas. It was exciting but with many questions,” he said. “Almost immediately, everybody’s minds turned to a confirmation well. We had to determine the oil column, if any, the water table and the continuity of the reservoir and an all-season location, which required tons and tons of gravel.”
Though the “Dallas people” pored over all the seismic maps, there was no drama and little politics involved in selecting the location of the confirmation well, Sweet said.
“It had to be a long step-out and near a source of gravel. That put the location near the Sag River where geologists determined there was lots of gravel,” he explained.
The explorers spudded Sag River State No. 1 May 3, 1968 and by July, ARCO and Humble geologists had tested the Sadlerochit Formation and confirmed the presence of the Prudhoe Bay oil field.
Mull said an interesting aspect of the Sag River well was the reservoir quality that the geologists saw in the cores. “Normally, a core that comes out of a core barrel consists of solid rock that you hope will have oil or gas in the pore spaces. But in one of the cores from the Sadlerochit in the Sag River No. 1 well, what came out was just a pile of loose sand, gravel and oil — which immediately ran down through the derrick floor into the cellar below.
In an effort to keep findings confidential, ARCO had erected a sheet on the rig to screen off the area where the geologists examined core samples from the drilling crew.
“What we were seeing in the samples was supposed to be a secret from the drilling crews, but they generally had a pretty good idea of what we were finding, and particularly so, after seeing that oil running through the derrick floor,” Mull said.
On June 25, 1968, Atlantic Richfield Co. said in perhaps the most understated new release in oil company history: “The Sag River State No. 1 — a joint venture with Humble Oil & Refining Co. — has encountered oil in the same Triassic formation as the initial well.”
Anderson, ARCO’s CEO, said, “We believe this is a significant oil and gas discovery, the extent of which must await further testing and exploratory drilling.”
Significant isn’t even close to describing the find that would change the company’s — and Alaska’s — history forever. Just a month later, Anderson announced that the find was potentially “one of the largest petroleum accumulations known to the world today.”
Says Sweet: “The statistical chance that the Sadlerochit (formation) would occur in conjunction with the Prudhoe Bay structure boggles the mind.”
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