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Vol. 12, No. 18 Week of May 06, 2007
Providing coverage of Alaska and northern Canada's oil and gas industry

Pioneer Natural Resources drops Cronus unit

Disappointing results from 2005-06 exploration well behind decision to relinquish former ConocoPhillips North Slope prospect

Kay Cashman

Petroleum News

Pioneer Natural Resources is planning to terminate the North Slope Cronus unit where it drilled the Cronus 1 exploration well in the winter 2005-06 drilling season.

“While the well penetrated oil bearing sands, further analysis did not support economic viability of the prospect. The well was deemed unsuccessful as disclosed in the second quarter 2006,” Sam Hicks, manager of corporate communications and public affairs for Pioneer, told Petroleum News April 26.

Under the three-year plan of exploration the company has with the state’s Division of Oil and Gas, the working interest owners can voluntarily terminate the unit and surrender the leases before the end of the second year without further obligation to the state. The second year ends Oct. 28.

Cronus is southwest of the ConocoPhillips-operated Kuparuk River unit and west of the company’s Meltwater field.

Conoco was the operator of Cronus when the unit was approved in October 2005, but transferred its interest to Pioneer, which was in the process of farming into the unit. (The leases were originally part of the larger Southeast Delta exploration unit, dissolved in 2003 when ConocoPhillips elected not to drill the Cronus well.)

Too tight to produce

In May 2006, Pioneer announced the discovery of oil in Cronus 1.

“A thick, oil-bearing sand section in the Torok and a thin, oil-bearing sand in the Jurassic-aged Kuparuk C were penetrated by the well,” the company said. “Wireline and core data are currently being analyzed and integrated with 3-D seismic to determine if appraisal activities are warranted during the 2006-2007 winter drilling season.”

But in August the company said the hydrocarbon bearing zones were too tight to produce.

“After analyzing data from the well and 3-D seismic, it was determined that the hydrocarbon bearing zones were too tight to produce. Therefore, the well was declared a dry hole and expensed in Q2,” Susan Spratlen, Pioneer’s vice president, corporate communications and public affairs, told Petroleum News Aug. 15.

Currently, Pioneer has a 90 percent working interest in the two-lease 11,343-acre unit near Meltwater; Alaska Venture Capital Group has the remaining 10 percent.



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