HOME PAGE SUBSCRIPTIONS, Print Editions, Newsletter PRODUCTS READ THE PETROLEUM NEWS ARCHIVE! ADVERTISING INFORMATION EVENTS PETROLEUM NEWS BAKKEN MINING NEWS

Providing coverage of Alaska and northern Canada's oil and gas industry
June 2014

Vol. 19, No. 25 Week of June 22, 2014

Swanson River: an aging success story

Kenai Peninsula field that propelled Alaska toward statehood still delivers oil & gas more than 50 years after first production

Alan Bailey

Petroleum News

Explorers from Richfield Oil Co. were drawn to the Swanson River area of Alaska’s northern Kenai Peninsula by an unusual-looking, half-circle bend in the Swanson River, according to a paper by Kevin Eastam of Hilcorp Alaska, published recently by the American Association of Petroleum Geologists in a memoir on the oil and gas fields of the Cook Inlet basin. The bend in the river suggested the existence of a subsurface geologic structure, Eastam wrote.

That initial hunch proved correct when subsequent seismic surveying revealed a major fold in the subsurface rock strata, with the possibility of that structure trapping oil. On July 23, 1957, Richfield, having drilled the Swanson River no. 1 well, announced the discovery of Alaska’s first major, commercial oil field. The well, at the northern edge of the field, would have proved dry, had it been drilled just half-a-mile farther north, Eastam wrote.

But, as it turned out, the newly discovered Swanson River field demonstrated that Alaska could become economically self-sufficient, enabling the territory to move towards statehood. Oil production started in 1958, peaked in 1966 and has continued to the present day, albeit at a much reduced rate. The field has also proved to be a major source of natural gas.

North-south fold

The structure that initially attracted the explorers to the field proved to be a north-south trending anticline, a fold with an upwards apex, rather like an elongated dome. The axis of the fold slopes eastward, making the fold somewhat asymmetric.

As with subsequent fields discovered in the Cook Inlet basin, the oil and gas reservoirs at Swanson River are in a sequence of rocks of Tertiary age, the younger and shallower of the two major rock sequences in the basin. And oil production started from the Hemlock formation, a relatively old and deep Tertiary unit. The Hemlock remains the field’s main oil-producing reservoir. The height of the oil column in the Hemlock varies from 600 feet in the northern part of the field to around 250 feet in the south, Eastam wrote. Oil originated from the Tuxedni formation, Jurassic in age and lying below the Tertiary rocks.

The Hemlock at Swanson River consists of a sequence of interbedded fine-grained to coarse-grained sandstones, conglomerates and siltstones, with coal seams commonly present. Geologists think that the sediments that now form the rocks were laid down by a braided river system, analogous to the present-day Susitna River to the north. Veins containing calcium carbonate tend to block the flow of oil in places, and 13 distinct producing sand units have been identified within the formation. Eight of the sands are only productive in the more southern part of the field, Eastam wrote.

Initial development

Initial field development was completed in 1963 with the drilling of 55 wells in the Hemlock. Then, after encountering a rapid decline in reservoir pressure after oil production started, the field operator installed compressors to begin to inject produced gas back into the reservoir. But, with gas produced from the field proving insufficient for adequate pressure maintenance, in 1965 a pipeline was built to ship gas from the Kenai gas field to Swanson River. Full gas compression and injection facilities were installed in 1966, enabling the expansion of oil production beyond what had previously been possible and leading to the 1966 production peak of 38,000 barrels of oil per day, Eastam wrote.

The gas injection has likely contributed to an oil recovery factor that is better than might otherwise have been expected. Original oil in place in the Hemlock has been estimated at 435 million barrels - with a recovery to date of 228 million barrels of oil from this part of the field, the recovery efficiency has been 52 percent, Eastam wrote.

In 1969, with an increasing proportion of gas in the reservoir, oil production began to decline. The injected gas also had the secondary effect of causing asphalt-like material to precipitate from the oil, clogging the reservoir and damaging wells, thus requiring the use of solvents and well remediation.

Gas blowdown

In 1992 Union Oil Co. of California became field operator and soon began a blowdown of the gas that had accumulated in the field, using the gas to supply the company’s fertilizer plant at Nikiski, Eastam wrote. Gas delivery peaked at 90 million cubic feet per day by 1996 and has since declined to 2.5 million cubic feet per day. By the late 1990s pressure maintenance in the Hemlock had ceased, although blowdown of the Hemlock gas continues to the present day. Nowadays, artificial lift using down-hole pumps has become critical to maximizing oil and gas production both from the Hemlock and from the Tyonek formation, above the Hemlock, Eastam wrote. The only three-rod pump completions in Alaska were installed in 2001. Optimization of artificial lift well completions that began in 2009 has included the implementation of electric submersible pumps, he wrote.

The deepest section of the Tyonek formation, known as the Tyonek G-zone, forms a secondary oil reservoir with two oil-bearing intervals above the Hemlock. Broadly similar in nature to the Hemlock reservoir, the zone contains a wide variety of rock types, including coal, with sandstone units forming the main hydrocarbon-bearing reservoirs. An abundance of clay material in the rock can create issues with the reservoir quality. And a tendency of some of this material to swell when hydrated drives a need to avoid the use of fresh-water- and potassium- based well fluids, Eastam said.

A common practice in the past of comingling oil produced from both the Hemlock and the Tyonek creates uncertainty in evaluating production data for the Tyonek G-zone, Eastam wrote. And various factors have led to complications in trying to estimate the amount of original oil in place in the zone, he wrote. Data presented in Eastam’s paper indicate a cumulative oil production to date of 2.2 million barrels from the Tyonek, with peak production of 1,700 barrels per day.

Shallow gas

In addition to gas associated with the oil resource, the Swanson River field was found to hold substantial natural gas resources at relatively shallow depths, in the upper part of the Tyonek and in the younger and shallower Beluga and Sterling formations. But, unlike the thermally generated gas associated with oil, the shallower gas is “biogenic,” sourced from the multitude of coal seams in the rock sequence. There are more than 50 individual shallow gas sands at depths ranging from 2,500 feet to 8,000 feet, Eastam wrote. Gas sands in the Tyonek and the Beluga appear to have originated as meandering river channels - the resulting sand bodies in the Beluga, for example, tending to be thin and discontinuous. Sandstone units in the Sterling tend to be thick and laterally continuous, probably formed from a braided stream system.

Shallow gas production at Swanson River between 1960 and 1966 primarily provided fuel for field operations, while also supporting initial efforts at Hemlock reservoir pressure maintenance, Eastam said. Gas production then became unnecessary following the installation of full-field compression arrangements for the Hemlock in 1966, with low gas prices through to the early 1990s also discouraging gas development and production.

Shallow gas production picked up with the blowdown of gas from the Hemlock that started in the early 1990s - the vast majority of new wells drilled in the field since the early 1990s have been shallow gas wells. And in 2001 Union Oil contracted to supply gas from Swanson River to a local gas utility, Eastam said. Also in 2001, gas storage operations began in depleted gas reservoirs in the Tyonek, for winter gas delivery to the Nikiski fertilizer plant, he wrote.

Recent operations targeting oil production have focused on returning shut-in wells to production and the optimization of artificial lift, Eastam wrote.






Petroleum News - Phone: 1-907 522-9469 - Fax: 1-907 522-9583
[email protected] --- http://www.petroleumnews.com ---
S U B S C R I B E

Copyright Petroleum Newspapers of Alaska, LLC (Petroleum News)(PNA)©2013 All rights reserved. The content of this article and web site may not be copied, replaced, distributed, published, displayed or transferred in any form or by any means except with the prior written permission of Petroleum Newspapers of Alaska, LLC (Petroleum News)(PNA). Copyright infringement is a violation of federal law subject to criminal and civil penalties.