Kupcake on track for February drilling

Given their proximity, if Savant prospect is connected to Liberty reservoir it could become part of BP-operated Liberty unit

Kay Cashman

Petroleum News

Savant Alaska is on track to begin Kupcake drilling operations in February, Erik Opstad told Petroleum News June 30. The company has received approval of its oil discharge prevention and contingency plan from the U.S. Minerals Management Service for exploration of the Kupcake oil prospect, which is adjacent to BP’s Liberty prospect. Opstad is a consultant tasked with finding a drilling rig and putting together a group of contractors for the Denver-based independent, which first entered Alaska in March 2006 when it purchased seven Beaufort Sea leases from the State of Alaska.

The undrilled Kupcake prospect is adjacent to Liberty’s southwestern border and is expected to hold approximately 100 million barrels of recoverable oil. BP has pegged Liberty’s recoverable oil at between 120 million and 130 million barrels and is currently moving toward field development. First oil production is expected in 2011, although it will take three years to ramp up to full operation, BP says. The company’s development plan involves drilling ultra-extended-reach wells from the Endicott field’s drilling island, which is five to eight miles west of Liberty.

The Kupcake well site is about three miles offshore in Foggy Island Bay (Sec. 29, T. 11 N., R. 18 E., UM) on state lease 390837 in waters that are 14 feet deep. The site is approximately 8,000 feet west of the Liberty No. 1 discovery well. Access for Kupcake No. 1 will be via ice-snow roads from Endicott, Savant has told state and federal officials.

In a Sept. 27, pre-permit application overview of the Kupcake project Savant characterized the prospect as “a conventional exploration well targeting several hundred feet of Beaufortian-age sediments located at a depth of approximately -10,600 feet.”

“Based on interpretation of licensed 3-D seismic data, Savant suggests that Beaufortian sediments have filled an accommodation space between the NW-SE trending Mikkelsen Bay and Tigvariak faults adjacent to the discovery at Liberty,” Savant COO and Executive Vice President Greg Vigil said. An 8.4 percent working interest partner in the prospect, Houston-based True North Energy Corp., said Kupcake No. 1 would test the Kemik formation.

Vigil said this winter’s exploration drilling is intended to prove or disprove the prospect.

Given its proximity to Liberty, what happens if Kupcake is connected to the Liberty reservoir?

Here’s what MMS spokeswoman Robin Cacy said last fall: “Provided Savant drills a successful well, Savant would need to first seek voluntary unitization with BP. The burden is on Savant to demonstrate that their well is part of a reasonably delineated and productive part of the Liberty reservoir (such as geological and geophysical data showing the same geologic structure and/or well data showing the well is in pressure communication with Liberty). If BP agrees, the unit can be expanded to include the new area. If BP does not agree, MMS would need to make an assessment to proceed with compulsory unitization or not. As state lands would be involved, coordination with the state would also be necessary.”

Opstad and Vigil are two of three key people working for Savant who used to be with BP in Alaska. The third is F.X. O’Keefe, who is in charge of business development for Savant Alaska.

Savant executives have said Savant is targeting accumulations north of the Brooks Range that are close to existing infrastructure.