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Shooting seismic in Nenana this winter Andex Resources contracts with PGS Onshore to complete $3 million seismic program in Nenana Basin during winter of 2004-2005 Patricia Liles Petroleum News Contributing Writer
Andex Resources LLC plans to spend $3 million this winter on a two-dimensional seismic program in the Nenana basin, a relatively unexplored area in Interior Alaska believed to have natural gas potential.
The Denver and Houston-based company holds an exploration license for nearly 500,000 acres of land in the Nenana basin. Andex has contracted PGS Onshore to complete the seismic work, scheduled to begin in December as soon as weather conditions allow, according to Larry Watt, PGS’s Alaska manager.
“Start up depends on the weather — when we have enough snow cover and ice,” Watt said. “We’ll start everything after Dec. 1 and will be out of there by April 30.”
The actual seismic recording work will take about 60 days, he said, once the front-end work is completed. A temporary camp to house workers will be set up by Taiga Ventures of Fairbanks, roughly 15 miles west of Nenana in the Minto Flats. Temporary ice roads will be constructed to the camp, providing four-wheel drive vehicle access. Constructing a snow/ice bridge across the Nenana River to access the Minto Flats area will be the first access hurdle.
Watt expects a crew of 35 to 40 people to work on the seismic project, which includes camp and catering employees. Talks about efforts to hire locally have already begun, a topic included in a public meeting held in Nenana on May 25.
“We had about 40 or 50 people there. There was a lot of interest and questions,” Watt said. “A lot of the concerns involved local hire.”
Slots that could be filled locally include drivers, mechanics, recording helpers and camp catering staff, he said.
About two months prior to start-up, PGS will take applications from local residents and conduct a two-day induction, providing safety, environmental and job training. Spending details PGS Onshore’s client, Andex Resources, announced during the public meeting in Nenana their plans to spend $3 million on the seismic program this winter. That’s in addition to spending about $3 million to acquire old seismic data shot in the 1960s and 1980s, and reprocessing that information, Watt said.
An Andex spokesman declined to comment for this article.
“They said they have already spent $3 million, and they will spend another $3 million this winter. To drill wells, they plan to spend $10 to $12 million in ensuing years,” Watt said.
Andex has a work commitment with the state of Alaska, part of its exploration license issued in late 2002, according to Matt Rader, natural resource specialist in the Department of Natural Resources’ Division of Oil and Gas.
Andex’s license contains a seven-year term to convert to oil and gas leases, and contains a work commitment of $2,525,000, Rader said.
The division is taking comments on the seismic exploration program through June 11 and should issue the permit to PGS later in June, said Rader, who also attended the public meeting in Nenana.
“People at the meeting were interested in local employment opportunities, and how the work would be staged out of Nenana,” he said. “There were not really any other concerns that came up at the meeting.” Exploration plans PGS plans to collect approximately 200 line miles of 2-D seismic in the northeast/southwest trending basin. One initial reconnaissance line will stretch 40 miles, running nearly the entire length of the exploration area. A second line, parallel to that initial reconnaissance line, will cover about two-thirds of the distance, or about 25 miles.
Two small areas within the exploration license area will contain clusters of seismic lines, in a pattern “fairly concentrated,” Watt said. The center of the exploration area is about 10 miles west of Nenana, Watt said. “They will be working northeast and southwest of that point,” he said. “They will not go more than 25 miles from Nenana.”
Andex’s license is west of the Parks Highway, extending from Anderson north to approximately eight miles south of the village of Minto. There are also lands within the license area owned by Doyon Ltd., Seth de Ya-Ah Corp. (the Minto village corporation) and Toghottehle Corp. (the Nenana village corporation).
Andex and PGS met with the Native corporations in May, prior to the public meeting, Watt said. Past work According to the department’s final best interest finding for the Nenana basin, issued in August, the area is relatively unexplored. The northern basin is undrilled, and no seismic data has been gathered there, despite gravity surveys showing it hosting the deepest portion of fill in the sedimentary basin.
“The sedimentary basin fill consists of as much as 16,000 feet or more of non-marine Quaternary and Tertiary sediments lying above a Jurassic metamorphic basement,” the state report said. “The prospective sedimentary section, thought to be time-equivalent to the productive Kenai Group in the Cook Inlet, consists of sands, gravels, conglomerates, shales and coals ... structural, stratigraphic and combination traps are likely to occur throughout the basin.” Two shallow exploration wells were drilled in the central and the southern portion of the study area, where some seismic data has been previously acquired.
“Except for minor amounts of gas associated with coal beds, no hydrocarbon shows were observed in the wells,” the state said in its report. “Reports of oil seeps in the basin are unconfirmed.”
Unocal drilled the 3,062-foot Nenana No. 1 just west of Andex’s license area in 1962. ARCO drilled the 3,509-foot Totek Hills No. 1 south of the exploration license area in 1984.
“At that time, no one was looking for gas,” Watt said. “Hopefully this will prove out to be good for the community and our client.”
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