After a year of increased activity at the Kuparuk River unit, ConocoPhillips expects to take a small step back this year. While drilling at the main Kuparuk field is expected to increase over 2015 levels, programs at the four satellites could be slightly reduced.
The Alaska subsidiary of the international company plans to drill approximately 29 wells and sidetracks at the main Kuparuk field over the course of this year - eight new rotary wells and 21 coiled-tubing-drilling sidetracks. That would be a slight increase from the 28 penetrations drilled at the unit in 2015. And given that ConocoPhillips only planned to drill 23 penetrations last year, actual totals could potential surpass the proposed amounts.
But the company is deferring a major development at the West Sak satellite for the time being and pushing off any additional development at the Tarn satellite until mid-2017.
The Meltwater and Tabasco satellites have seen little drilling in recent years.
The reduced activity over the coming year might alter the overall production profile of the unit. While recent drilling activities have merely mitigated declines at Kuparuk, the declines have been much smaller at the satellites. Altogether, the Kuparuk River unit produced 104,600 barrels per day in 2015, down from 110,700 bpd in 2014.
Kuparuk
At the Kuparuk participating area covering the main field at the unit, the seven-well drilling program for 2015 focused primarily on Drill Site 2S, which ConocoPhillips brought into operation toward the end of the year. The company drilled one production well and five injection wells from the pad in the southwest corner of the unit. The remaining rotary well was drilled into the Kuparuk C sand from the nearby Drill Site 2F.
The sidetrack program was scattered throughout the unit area, although the company drilled six sidetracks from Drill Site 3O in the north of the unit and three from Drill Site 1G in the center of the unit.
ConocoPhillips credited the sidetrack program with generating a peak incremental production rate of 3,500 gross barrels of oil per day. A workover program added 6,500 bpd and non-rig well work added another 13,200 bpd, according to the company.
Even with the marginal increases, the Kuparuk participating area produced 78,200 bpd in 2015, down from 83,200 bpd in 2014 and 85,700 bpd in 2013, according to the company.
Through the end of 2015, ConocoPhillips was developing the main Kuparuk field from 850 active wells at 45 drill sites, including the new Drill Site 2S.
‘Infrastructure-led exploration’
Over the past decade, ConocoPhillips has been pursuing an “infrastructure-led exploration” strategy at Kuparuk by conducting exploration near existing wells.
This strategy led to development of Drill Site 2S and is currently being used to appraise the potential of the overlying Cretaceous Brookian Moraine interval in the vicinity of the former Palm satellite around Drill Site 3S near the northwestern corner of the unit.
ConocoPhillips drilled two wells into the Moraine interval in 2015. The company drilled the vertical Moraine 1 well from an ice pad “to acquire extensive logs with whole core for detailed reservoir and overburden characterization studies, including special core analysis.” The company plugged and abandoned the well after operations were complete.
In the first quarter of 2015, ConocoPhillips had drilled and completed the horizontal 3S-620 production well. The company returned in the second quarter of this year to drill the corresponding 3S-613 injection well, although actual injection is on hold, pending approval of an Area Injection Order. “Results from special core analyses and reservoir performance from the 3S-620 producer well and 3S-613 injector well will guide future development plans for the Moraine interval,” the company recently told state officials.
While ConocoPhillips believes “appraisal and exploration opportunities exist” within the Kuparuk River unit, the company made no specific plans for new ventures this year.
West Sak
The Kuparuk River unit includes four official satellites: West Sak, Tarn, Tabasco and Meltwater. The old Palm satellite is now developed in conjunction with the main field.
At the end of 2015, ConocoPhillips was developing West Sak from 109 active wells at six drill sites - up from 92 active wells in 2014 and 96 active wells in 2013. West Sak shares its drill sites - 1B, 1C, 1D, 1E, 1J and 3K - with the main Kuparuk field.
Even with the increase, production declined. West Sak produced some 13,865 bpd in 2015, down from 16,241 bpd in 2014 and 15,772 bpd in 2013.
ConocoPhillips drilled eight new West Sak wells at Drill Site 1D and Drill Site 1C in 2015, as proposed in a previous plan of development. The Drill Site 1D program included the single-lateral injector 1D-142, the quad-lateral producer 1D-143, the single-lateral producer 1D-145 and the single-lateral producer 1D-146. The company is currently considering additional wells from the pad, pending the results of the recent program.
The Drill Site 1 C program included the single-lateral injector 1C-152, the single-lateral producer 1C-153, the single-lateral injector 1C-154 and the single-lateral producer 1C-155. The company is considering three additional “lower value” targets from the pad.
While ConocoPhillips had originally intended to begin the major 1H NEWS program at Drill Site 1H this year, the company deferred the program “based on market conditions.” Prior to making the decision, the company completed “much of the surface work to expand the existing DS1H gravel pad and facilities to accommodate the 19 new wells.”
As the satellite approaches its 20th year, West Sak presents many opportunities for ConocoPhillips but is also beginning to show its age. All six of the drill sites at the satellite are currently developing both the West Sak and North East West Sak participating areas and any new development will likely require facility upgrades, according to the company. “These additional facility requirements add to the economic challenge of further West Sak/NEWS development in the current business environment.”
That said, ConocoPhillips is currently evaluating at least four additional developments at West Sak: a multi-well Eastern NEWS development that would require a new drill site, and NEWS developments at the existing Drill Site 3K, Drill Site 3N and Drill Site 3R.
While Drill Site 3K and Drill Site 3N could potentially be developed in phases from the existing pads, the Drill Site 3R project might require an expansion to the existing pad.
ConocoPhillips has been planning a two-well pilot program at Drill Site since 2013. This summer, the company expects to finish processing a 47-square-mile 3-D seismic survey acquired over the region in mid-2014. The survey included portions of the shallow waters off the coast of Oliktok Point and was “critical to further development drilling” in the vicinity of Drill Site 3R and the planning of “long horizontal wells,” according to the company. All those details suggest an attempt to reach offshore from Oliktok Point.
Tarn
After West Sak, the Tarn satellite is getting the most attention.
At the end of 2015, ConocoPhillips was developing the Tarn participating area from 63 active wells at Drill Site 2N and Drill Site 2L - down from 69 in 2014 and up from 61 in 2013. Even with the reduction in active wells, Tarn production increased to 9,300 bpd in 2015, up 7,700 bpd in 2014 and 5,600 bpd in 2013. Those increases are the result of a significant drilling campaign at the participating area in recent years, starting with a nine-well program in 2014 and continuing with a five well program in 2015.
ConocoPhillips brought the horizontal 2N-336 well into production in April 2015. The well targeted an undeveloped area south of the main 2N accumulation. The well produced 65,000 barrels through 2015 and averaged 330 bpd in December 2015.
The company brought the horizontal 2L-308 well into production in May 2015. The well targeted a region at the northeastern periphery of Drill Site 2L. The well produced 160,000 barrels through 2015 and averaged 160 bpd in December 2015.
The company brought the horizontal 2L-328 well online in June 2015. The well targeted a fairway south of 2L-321 “in the heart of the 2L accumulation.” The well produced 188,000 barrels through 2015 and averaged 190 bpd in December 2015.
The company brought the horizontal 2L-316 well into production in August 2015. The well targeted a fairway between 2L-311 to the north and 2L-320 to the south. The well produced 64,000 through 2015 and averaged 370 bpd in December 2015.
The final well, 2N-312, was a slanted injector brought online in September 2015 to “support and sweep resources in the southwestern area of the 2L accumulation and the fringe area between the 2N and 2L accumulations.” The well injected 223,000 barrels of water through 2015 and averaged 1,400 barrels of water per day in December 2015.
Even with the recent success at Tarn, ConocoPhillips is planning no development drilling at the participating area under the current development plan, which expires at the end of July 2017. The company is evaluating recent drilling results to identify future projects.
The drilling programs at Tarn in 2014 and 2015 only delineated the Bermuda interval at Tarn, and two other intervals could provide opportunities: the older Purple interval, which has seen “encouraging” results from other wells, and the younger Cairn interval. In previous plans of development, the company has also mentioned the Esker interval.
Tabasco and Meltwater
The Tabasco satellite remains unchanged over the past year, although production increased. ConocoPhillips is developing the satellite from five active production wells and two active injection wells at Drills Site 2T. The satellite produced 1,619 bpd in 2015, up from 1,549 bpd in 2014 and down from 1,711 bpd in 2013. The company is planning no development or exploration drilling this year.
At the end of 2015, ConocoPhillips was developing the Meltwater satellite from 16 active wells at Drill Site 2P, down from 17 active wells in 2014 and up from 15 active wells in 2013 and 2012. Meltwater produced 1,569 bpd in 2015, up from 1,439 bpd in 2014 and down from 1,971 bpd in 2013. Although the company has been analyzing opportunities at the satellite, it is not proposing any drilling activities this year.
