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Vol. 15, No. 46 Week of November 14, 2010
Providing coverage of Alaska and northern Canada's oil and gas industry

The Explorers 2010: Exxon: Point Thomson wells successful

Kay cashman

Petroleum News

On Oct. 27 ExxonMobil announced that it had successfully drilled and tested the PTU-15 and PTU-16 development wells for the Point Thomson project on Alaska’s eastern North Slope, “ahead of the year-end 2010 target.”

Exxon has previously said it expected to begin production of 10,000 barrels a day of gas condensate from the project by the end of 2014. (See company profile on page 92.)

Exxon’s Alaska Production Manager Dale Pittman was quoted in the late October press release as saying, “The successful drilling and testing of these wells represents a significant accomplishment and demonstrates we are delivering on our commitments. Many Alaskans contributed to this milestone, completing work ahead of schedule in a safe and environmentally responsible manner.”

Point Thomson is a remote natural gas and condensate field approximately 60 miles east of Prudhoe Bay. It is farther east than any development to date by about 40 miles. PTU-15 and PTU-16 were the first wells drilled in the field since 1983.

It is estimated to hold about 25 percent of the North Slope’s discovered gas resources. “Concurrent with the drilling of these two development wells, activities are also focused on engineering and environmental permitting which are critical for project development,” Exxon’s release said.

To date about $1.5 billion, including more than $730 million in the last two years, has been invested in Point Thomson, Exxon said.

The Point Thomson project includes gas cycling facilities designed to recover hydrocarbon liquids and re-inject natural gas back into the reservoir, making Point Thomson “the highest-pressure gas cycling operation in the world,” Exxon said.

Working out legal issues

“The project is providing jobs and investment in Alaska,” said Pittman. “We are continuing to work with the State of Alaska to resolve outstanding issues in order to maintain the pace and momentum of Point Thomson development,” referring to legal battles with the state, which are partly on hold while the parties try to work out a mutually acceptable settlement.

The state has been legally seeking to reclaim the state-owned acreage at Point Thomson on grounds that the leaseholders neglected to develop the field after its 1977 discovery.

Point Thomson natural gas, Pittman said, is “critical to the success of an Alaska gas pipeline project.”

The two recent wells were drilled to a measured depth of more than 16,000 feet, Exxon said. The shore-based Nabors 27-E rig drilled directionally under the Beaufort Sea to the targeted gas reservoir more than 1.5 miles offshore.

The Point Thomson reservoir is “abnormally pressured in excess of 10,000 psi,” Exxon said, noting that more than “150 companies have been working to safely advance development of the field in an environmentally responsible manner.”

Preparation of the Environmental Impact Statement and design work on the facilities (known as Front End Engineering Design or “FEED”) are now “well advanced,” Exxon said in its release.

The U.S. Army Corps of Engineers is in charge of preparing the EIS for the project, and an Exxon affiliate has applied for a state right of way to build a 22-mile pipeline to carry Point Thomson liquids west to Badami to hook into the existing North Slope pipeline network.

The Corps originally estimated it would sign a “record of decision” on the project in July 2011 and publish it in August 2011. The need for an EIS was triggered by Exxon’s application for a Corps wetlands permit.

Now the target date is Jan. 19, 2012, the Corps says.



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