BP Exploration (Alaska) has applied to restart the Badami field for a three-year period to test new recovery techniques. The company applied to the Alaska Department of Environmental Conservation for an air quality control construction permit earlier this year; DEC published a proposed permit for public comment May 27.
BP plans well drilling and workover activity from the existing pad as part of the restart and asked for a flexible permit to allow operation predominantly on gas-fired turbines, while in production, or on diesel-fired main generators while in warm shutdown.
BP spokesman Daren Beaudo told Petroleum News June 1 that the “best timeline estimate” for restarting the field is late summer, but if and when the field goes back online is “absolutely contingent,” he said, “upon receiving the permit approvals in a timely fashion.”
The Badami field, developed in the late 1990s, is on Mikkelsen Bay east of Prudhoe Bay and is the farthest east development on the North Slope. It was the first turbidite reservoir to be developed on the slope, and has been in warm shutdown because oil production from the field was at much lower levels than the company anticipated.
DEC said BP decided to restart Badami because of the current high price of oil and because of the availability of new reservoir oil recovery methods designed specifically for Badami. The permit covers three proposed operation modes because BP does not know “which oil recovery strategy will work best for the Badami reservoir specifics,” DEC said in a preliminary technical analysis report issued May 27. The field may go back into warm shutdown; it may be operated intermittently; or it may be operated continuously.
DEC said the restart project is “an evaluation project of limited duration to apply new drilling technology and to assess how the field will operate in the future.”
BP began producing from Badami in August 1998, and expected to be at rates of more than 10,000 barrels per day by that fall. In October 1998, however, production was only at 4,000-5,000 bpd from eight reservoir penetrations. Production dropped to 1,350 bpd in early 2003, and production was suspended and the field put into warm shutdown.
Production exploration program
BP told DEC the restart operations are part of a “production exploration program” of the Badami oil reservoir, and said it expects the operations will take a maximum of three years, “or even shorter if the oil reservoir production results are not satisfactory.” BP expects recovery from the reservoir “will benefit from the new oil recovery technologies, specific for the Badami reservoir, and there is a chance that it will become a good producer.”
BP told DEC it expects the reservoir could be a good “intermittent producer,” but said there is also a possibility the reservoir will become a good “continuous producer.” At this time it is not known if the restart will continue for the entire planned 36-month period, and it is not known if Badami production rates are sufficient to maintain Badami operations now or in the future, the agency said.
Changing oil economics will determine if short-term or long-term operations at Badami are possible.
Reservoir known to be challenging
Badami was recognized as a complex reservoir before production began.
In a 1997 interview, Ken Konrad, then BP developments manager, said “even on a global-BP basis, the reservoir aspects of Badami are considered within our corporation either one of the most challenging or the most challenging attempts to date. There’s just a high degree of complexity which we’re increasingly confident that we understand, but nevertheless it is an extraordinarily complex system.”
The oil at Badami has been described as occurring in channels or fingers, and Bill Bredar, Badami subsurface manager, said in that same 1997 interview that of the compartmentalized channels identified, about 10 would be targeted initially. He characterized the reservoir as “channelized areas. They’re multiple channels that are kind of stacked up. And we are targeting these … amalgamated channels.”
The depositional environment, Bredar said, was a turbidity current: sands, clays and muds piled up at the bottom of an underwater shelf following an event like an earthquake.
The sand holds oil, but unfortunately there’s a lot more mud than sand, Bredar said.
Another complexity at Badami is the range of oil gravity from 19 degrees to 29 degrees API.
Pipeline shutdown approved in 2003
The Regulatory Commission of Alaska approved BP Transportation (Alaska)’s request for a temporary shutdown of the Badami oil pipeline and the Badami gas and products pipeline in 2003. BP said it expected the shutdown to last for about two years while it evaluated “options for restart or reuse” of the Badami unit facilities, but the company also said the shutdown could be extended if restart or reuse of the facilities is not possible within two years.
The state approved BP’s application to suspend production from Badami and to mothball the unit’s facilities for a two-year period beginning Aug. 1, 2003, and ending June 30, 2005.
BP said in May 2003 that the field’s 1,350 bpd production rate “cannot offset field operating costs … making it uneconomical to continue operations.” The company said field production had been dropping each year, and was expected to continue to decline. BP spokesman Daren Beaudo told Petroleum News in June 2003 that BP would “continue to evaluate various options for Badami. The two-year suspension will give us time to do that.”
Options identified for Badami in paperwork filed with the state in 2003 included selling it to a third party, hosting BP’s proposed offshore Liberty development or use by the nearby Point Thomson project.
BP had drilled seven production wells, six of which were producing when the field was shutdown, two gas injection wells and a disposal well.
Production had been temporarily suspended in February 1999 due to low temperatures and concerns about the pipeline freezing since it was carrying much less oil than originally expected; the drilling program was suspended in May 1999 after the wells had significantly underperformed.
