State gives Teck exception for gas well

State regulators on April 11 issued a spacing exception allowing a local mining company to start testing and producing exploration wells in the non-conventional gas resources of the Northwest Arctic.

The Alaska Oil and Gas Conservation Commission approved a request from Teck Cominco Alaska Inc. to use an exploration well near the Red Dog zinc mine for testing the properties of shale gas formations in the area.

The well, NB-04A, is part of a multiwell program aimed at proving whether these shale resources can be developed in commercial quantities.

The wells sit about 1.5 miles north of the Red Dog Mine, on lands owned by the NANA Regional Corp., which also owns the land under the mine.

State regulations prohibit anyone from drilling a gas well within 3,000 feet of an existing well capable of tapping the same pool, but Teck Cominco argued that the unique nature of shale gas required the company to drill its wells close together. To relieve the pressure in shale, producers must dewater the reservoir, a process aided by closely spaced wells.

Teck Cominco began exploring the possibility of shale gas production nearly a decade ago. Any sustainable gas production from the program would go toward replacing diesel as the primary fuel for powering mine operations.

Teck Cominco made its request for a spacing exception on June 18, 2007.

—Eric Lidji