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Providing coverage of Alaska and northern Canada's oil and gas industry
November 2005

Special Pub. Week of November 31, 2005

THE EXPLORERS 2005: ConocoPhillips Alaska: The march west

Logistics a challenge as North Slope exploration, production moves west to Alpine, then into NPR-A

Kristen Nelson

Petroleum News

ConocoPhillips Alaska is the largest oil and gas producer in Alaska, and the state’s most active explorer, drilling 51 exploration wells between 1999 and 2005, and acquiring some 3,900 square miles of three-dimensional seismic over the same period.

Alaska is one of eight exploration focus areas for ConocoPhillips. The others are: Canada, the Gulf of Mexico, Venezuela, the North Sea, West Africa, the Caspian Sea and Asia Pacific.

ConocoPhillips Alaska is the successor of companies which have been working in Alaska since the 1950s.

ARCO Alaska was acquired by Phillips Petroleum in 2000 and became Phillips Alaska, and then ConocoPhillips Alaska after Phillips merged with Conoco in 2001.

Richfield Oil, one of the Atlantic Richfield predecessor companies, discovered the Swanson River field on the Kenai Peninsula in the 1950s, Alaska’s first modern oil and gas discovery, which provided the financial basis Congress required to make Alaska a state.

On the North Slope ARCO and its partner Humble Oil (now ExxonMobil) discovered the Prudhoe Bay field with a well drilled in 1967-68. ConocoPhillips Alaska remains a major partner in the Prudhoe Bay field.

ARCO discovered and ConocoPhillips operates the Kuparuk River field. The company discovered a number of Kuparuk satellite fields — Tarn, West Sak, Tabasco and Meltwater — which are now in production.

Exploration moves west

ARCO Alaska and its partner Anadarko Petroleum discovered the Alpine field west of Kuparuk in the late 1990s. Production began from this roadless development in late 2000; production from Alpine satellites Fiord and Nanuq is expected to begin in 2006.

ConocoPhillips Alaska also holds extensive exploration acreage on both state and federal lands across the North Slope, nearly 1.8 million net acres at year-end 2004, with some 1.3 million of those acres in the National Petroleum Reserve-Alaska.

Drilling began in NPR-A in the winter of 2000, and in the spring of 2001 Phillips Alaska and Anadarko announced the first NPR-A discoveries since the area was reopened to exploration in 1999.

Six wells and a sidetrack were drilled in the 1999-2000 and 2000-01 winter seasons, the companies said, and five wells and a sidetrack targeting the Alpine producing horizon all encountered oil or gas and condensate: Spark 1 and 1-A; Moose’s Tooth C; Lookout 1; and Rendezvous A and 2. The discoveries are 15 to 25 miles southwest of the Alpine field.

NPR-A exploration drilling continues, and an environmental impact statement has been completed for two of the NPR-A discoveries, as well as Alpine West, Fiord and Nanuq.

ConocoPhillips’ exploration partners are Anadarko at the Colville River unit where Alpine is in production, at the Alpine satellites and in NPR-A, and Pioneer Natural Resources Alaska in the Storms prospect south of Kuparuk and in NPR-A.

ConocoPhillips and Pioneer acquired 278 square miles of 3-D seismic across the Storms area in the winter of 2004-05, as well as 219 square miles of 3-D seismic at Kuparuk “for development purposes,” ConocoPhillips spokeswoman Dawn Patience told Petroleum News in October.

Logistics add to exploration costs

While exploration activity continues on the central North Slope, relatively close to infrastructure, as in the Storms area, the big push has been into NPR-A, farther and farther from roads and other infrastructure.

Last winter ConocoPhillips also drilled at Iapetus, another potential Alpine satellite.

Rick Mott, ConocoPhillips Alaska’s vice president of exploration and land, told Petroleum News in early 2005 that Iapetus is “on state lands and Native lands … due west of the Fiord development…” An ice road and an ice pad were required for the well, which was drilled from the shore into a prospect which, Mott said, “straddles the onshore and offshore.”

Another exploration well, which Mott described as an exploration tail from an Alpine development well, was drilled from Alpine infrastructure.

ConocoPhillips is also the operator at the Cosmopolitan discovery offshore the Kenai Peninsula in Southcentral Alaska. It has drilled two wells and in October the company was shooting marine 3-D seismic over the prospect.

But the company’s most significant exploration drilling last winter took place at the Kokoda prospect in NPR-A, where it drilled two wells. As exploration expands farther west, logistics add to the cost of wells, Mott said. When the company drilled at Puviaq in NPR-A in 2003, even farther west, the well was so far out the company didn’t do an ice road: it used rolligons to move supplies barged in to Barrow.

That well was a two-year effort, Mott said. An ice pad was built one year and equipment stored over the summer for drilling the second winter. It took about 18 months of elapsed time to drill one well. It was “very, very expensive,” he said and “you just don’t get enough holes in the ground doing it that way.”

Rolligons vs. ice roads

The Kokoda wells “are farther out than anyone has ventured with an ice road before,” he said.

Mott said you can set up for exploration drilling two ways: “One is to do it with rolligons and build an isolated ice pad and a couple of years ago we did that at Puviaq.” The problem, he said, is that “prevents you from being able to test the wells, if you find something, because you can’t get the test equipment out there in a timely fashion.”

By building an ice road, however, “we can actually test these wells if they’re discoveries.” ConocoPhillips built about 70 miles of ice road from Kuparuk to Kokoda.

Just getting the ice roads built required placing a remote camp in NPR-A and building from two directions to get the work done, he said. In the past Trailblazer was as far into NPR-A as anyone had gone with an ice road: Kokoda is southwest of the Trailblazer wells.

Mott said ConocoPhillips is studying ways “to explore in remote areas less expensively.” This could include a lighter rig, tracked vehicles in lieu of rolligons and lighter weight camps.

Roadless logistics

Logistics aren’t just an issue for exploration.

Alpine is a road-less development and ice roads are used to bring in supplies during the winter, as well as to bring in supplies for current Alpine work: putting the field’s first two satellites, Fiord and Nanuq, on production. Work began last winter, will continue this winter and the satellites are expected to have first production in the fourth quarter of 2006, Mark Ireland, ConocoPhillips Alaska’s western North Slope development manager told Petroleum News in August.

“Logistics in general are a real challenge to the Alpine area” since there is no road connection back, Ireland said. Supplies are flown in eight or nine months of the year, and “In the few months of the year that we have the ice road, it’s just truckload after truckload. I believe we had 1,600 truckloads of materials that came out this past winter, and that’s not an unusual amount for us.”

In addition to rig access for exploration farther out, continuing Alpine drilling and satellite construction, ConocoPhillips has been expanding the Alpine processing facilities, which also requires moving equipment in over an ice road.

Ireland said the plan the company is working is to develop Alpine first and then the satellites, to “help maintain ConocoPhillips’ long-term production in Alaska.”

“It will be even busier than this past winter. I’ll go on record with that,” he said of Alpine activity.

And as for planning, “it’s really a year-round effort now — it’s complete one year and start working the next.”






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