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$500 million West Sak heavy oil project approved
Kristen Nelson Petroleum News Editor-in-Chief
Commercial development of the heavy oil resource at West Sak on Alaska’s North Slope is finally becoming a reality.
ConocoPhillips, operator of the field within the Kuparuk River unit, and BP Exploration, the other major owner, said Aug. 10 that the first large-scale West Sak development has been approved: a $500 million two-pad, 44-well program which will increase West Sak oil field production to approximately 45,000 barrels of oil per day by 2007. Construction jobs for the project will peak next year at more than 850, the companies said.
Expansion of Drill Site 1E is expected to add about 10,000 barrels per day, with first production expected this summer, the companies said.
Darren Jones, vice president of ConocoPhillips’ Greater Kuparuk Business Unit, told Petroleum News that the fourth West Sak well is being drilled now at Drill Site 1E, an existing Kuparuk drill site. There are already some skids on site at 1E, Jones said, where work involves adding production headers for the West Sak wells and adding crude oil processing and water handling facilities, plus electrical and instrumentation modules.
The work at 1E, he said, just involves bringing in additional modules and the bulk of the West Sak development facilities work will be at that pad this year. West Sak pilot pad The other pad, 1J, where the majority of the wells, 31 out of 44, will be drilled, is the West Sak pilot pad, Jones said. The pad was built in 1984 and West Sak pilot vertical wells were drilled there.
“So the gravel is there,” Jones said, “but nothing else we could use.”
A pipeline and power line will be built to Drill Site 1J this winter, a distance of some three to four miles from Kuparuk Central Processing Facility 1, and modules will be installed this time next year.
Now that the project has been approved, Jones said, they can start ordering some of the longer-lead items and start letting contracts for construction.
Jones said they aren’t releasing an estimate of original oil in place for the Drill Site 1E and Drill Site 1J areas, but the known accumulation of West Sak oil at Kuparuk is 7 billion barrels of oil in place.
Development of Drill Site 1J will add about 30,000 bpd, with first production expected in late 2005 and peak production in 2007, the companies said. Production will more than quadruple The companies said production of West Sak oil is now at about 10,000 barrels per day, and with the Drill Site 1E and 1J project, production is expected to reach approximately 45,000 bpd by 2007.
The West Sak heavy oil accumulation overlies conventional oil over much of the Kuparuk River field, and the accumulation, variously called heavy or viscous, has been known for decades, since wells to conventional oil drill through the West Sak formation.
Producing it has been a challenge, but recently both ConocoPhillips and BP, which produces heavy oil at Milne Point and at western Prudhoe Bay satellite fields, have signaled success with multi-lateral wells: two, three or even four horizontal penetrations into the West Sak from a single well bore.
Greg Leveille, ConocoPhillips’ manager of Kuparuk satellites, said in February that ConocoPhillips began to employ new techniques to recover heavy oil in the 2000-2002 timeframe, including lateral wells through producing zones, but results were still “marginally economic.”
But, he said, 2003 was “a big transition year for us” in heavy oil, with “extremely long” lateral sections through the reservoir combined with a less expensive completion technique using slotted liners, a combination which made developing heavy oil an economic proposition. Forty-four West Sak wells Plans call for the drilling of 13 West Sak wells at Drill Site 1E and 31 wells at Drill Site 1J, the companies said. Jones said the 1E wells include seven injectors and six producers and the 1J wells include 14 injectors and 17 producers.
First-year average production rates from a typical West Sak well have climbed from a few hundred barrels of oil per day in 1997 to more than 1,500 bpd today, the companies said. The increase in production rates is a result of advanced drilling technologies such as multilateral wells, which have multiple producing well bores, and the use of enhanced oil recovery technologies that make it possible to extract more oil from the reservoir.
“Extensive technical cooperation by ConocoPhillips and BP also has contributed to the recent advance in the production and development of heavy oil resources at West Sak and the BP-operated Orion and Milne Point fields,” the companies said. Engineering under way Detailed engineering contracts for the West Sak development program have been awarded to VECO Alaska and NANA/Colt Engineering LLC. Additional contracts for drilling, facility module construction, pipelines and power lines will be awarded once detailed engineering is completed for Drill Site 1J. Companies that have already been awarded contracts for support of development at Drill Site 1E include ASRC Energy Services and Doyon Drilling.
ConocoPhillips Alaska operates the West Sak field, which will be owned by ConocoPhillips (52 percent), BP (37 percent), ExxonMobil (5.8 percent), Unocal (5.0 percent) and ChevronTexaco (0.1 percent).
ConocoPhillips Alaska spokeswoman Dawn Patience told Petroleum News that there have been some changes in ownership that are pending approval from the state of Alaska. Current ownership is ConocoPhillips 55.9 percent; BP 39.7 percent; Unocal 3.96 percent; ExxonMobil 0.36 percent; ChevronTexaco 0.1 percent.
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