Pieces continue to be shuffled and moved into place in a long process leading to the possible resumption of oil and natural gas exploration in the Canadian section of the Beaufort Sea, but actual drilling will likely have to wait until late this decade.
The most eagerly awaited announcement will come from a joint venture by operator Imperial Oil, ExxonMobil and BP, which expects to file a project description and environmental impact statement, EIS, with regulators later this year to drill one or more wells.
Imperial said a “decision to proceed with an exploration drilling operation in the Beaufort Sea would require a significant financial commitment” by the partners.
“Many factors would have to be considered in making a decision, including regulatory approvals and resolution of issues such as (the National Energy Board’s) equivalency to same-season relief well capability.
“Timely regulatory outcomes that are satisfactory to many stakeholders would be necessary to enable the joint venture” the company said.
At least three years
The project description and EIS are usually at least three years ahead of drilling, depending on how long public hearings last, according to an information package Imperial has distributed to regulators and local communities.
Imperial estimates the regulatory process could be completed as early as 2015 and would be followed by an economic feasibility study which would include identifying the most appropriate drilling system.
If the partners decide to embark on an exploration program, Imperial would expect to file an application with the NEB for permission to drill about four to six years before it would spud a well, allowing time to arrange a drilling system.
The drilling plan for each target would vary depending on location, water depth, the geologic zone and the predicted reservoir pressure.
On Exploration Licenses 476 (Ajurak) and 477 (Pokak) locations would be in water depths ranging from about 1,300 feet to 2,300 feet and have geological targets with total vertical depths subsea ranging from 12,500 feet to 22,300 feet.
Records indicate that manageable ice conditions average about 120 days from May to November, but the scope and length of drilling activities would vary. Imperial expects the program would cover three or more seasons, with the results determining whether further drilling would be needed.
Meanwhile, the partners are continuing to review results from the NEB’s Arctic offshore drilling review whole evaluating findings from 3-D seismic data gathered from their two large exploration blocks in 2007 and 2008 before the partnership was formed in mid-2010.
Of the two licenses, BP acquired one in 2008 for a work commitment of C$1.18 billion, while Imperial and ExxonMobil obtained their lease for a spending pledge of C$585 million.
Because of delays in the Arctic offshore review, the Canadian government issued fresh exploration licenses, effectively giving the companies until 2019 and 2020 to start drilling and qualify for extended rights if they can establish a significant discovery.
Chevron Canada is continuing to analyze results from last year’s 3-D marine seismic program covering 1,412 square miles, 145 miles northwest of Tuktoyaktuk on the shores of the Beaufort.
Norway’s Statoil has farmed-in on the 508,000-acre parcel in the deepwater Beaufort, which Chevron acquired in 2010 for a work commitment of C$103.3 million. It is west of the Imperial joint-venture blocks.
—Gary Park
