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TG World drops interest in Sak River Calgary independent cites poor test results from Sak River No. 1-A sidetrack, retaining interest in other joint venture properties Eric Lidji For Petroleum News
The Canadian independent TG World Energy Corp. is giving up its stake in a North Slope exploration well after judging initial production test results unsatisfactory.
A production test of the Kuparuk C-1 sandstone at the Sak River No. 1-A exploration well on March 5 and 6 “recovered water and a minor amount of oil,” according to a March 8 press release from the Calgary company. “The fluid composition was measured as 97 percent water on average with minor oil and gas content,” the company said.
As a result of what it called an “unsuccessful” well, TG World gave up “certain working interests in the Beechey Point Unit leases in Alaska to AVCG,” or the Alaska Venture Capital Group, the Kansas-based parent of Brooks Range Petroleum Corp., the independent operating a multiyear exploration program on behalf of several partners.
BRPC declined to offer further details on the results of Sak River No. 1-A testing.
BRPC spud Sak River No. 1-A in Gwydyr Bay on Jan. 26. The well is a sidetrack of Sak River No. 1, a suspended well BRPC drilled in early 2007 to a total depth of 11,348 feet and a measured depth of 13,110 feet. Sak River No. 1 did not encounter hydrocarbons.
On Feb. 17, BRPC said it drilled Sak River No. 1-A to a measured depth of 12,726 feet and a total depth of 9,350 feet, “stopping within the Miluveach formation.” The company said, “Porous sandstones with hydrocarbon shows were encountered in sandstones of the Kuparuk formation at a depth of approximately 8,900 feet subsea (total vertical depth).”
TG keeping other acreage TG World paid 45.7 percent of the drilling, completion and testing costs of Sak River No. 1-A in return for a 35 percent interest in the well. Although dropping the well, TG World is keeping a “net profit interest after payout” in the 2007 North Shore No. 1 discovery, as well as an interest in acreage at the Beechey Point unit “outside of the drilling blocks of Sak River, North Shore and Pete’s Wicked acreage.” TG World is also keeping its 25 percent stake in leases outside of the Beechey Point, and its 20 percent stake in the North Tarn farm-in.
BRPC confirmed that TG World is retaining its interest in the Tofkat prospect southwest of the Kuparuk River field and the South Thomson prospect south of Point Thomson. The company also confirmed that it plans to move ahead on exploration work this winter.
TG World also said North Tarn exploration, originally considered for this winter, was being pushed to early 2011 because of timing constraints as the end of winter approaches. BRPC confirmed that it intends to begin drilling a North Tarn No. 1 well in 2011, saying the target spud date for the well is “less than 10 months away.”
Move allowed by contract TG World backed off from joint venture drilling and development in Alaska in late 2008, when oil prices tanked and credit markets collapsed. In response, BRPC filed a lawsuit against TG World, forcing the joint venture to miss the 2009 exploration season. The companies eventually reached a settlement in time to prepare for the current season.
BRPC confirmed that under the terms of the current joint venture agreement, TG World is allowed to relinquish acreage in the manner it did at the Sak River well.
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