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Vol. 23, No.41 Week of October 14, 2018
Providing coverage of Alaska and northern Canada's oil and gas industry

Early GMT-1 start

First oil begins to flow from ConocoPhillips’ NPR-A Alpine satellite pad

Alan Bailey

Petroleum News

ConocoPhillips has announced that oil production from its Greater Mooses Tooth 1 development started on Oct. 5, ahead of the anticipated schedule for the project - the company has previously said that it anticipated production beginning by the end of this year. ConocoPhillips has developed the GMT-1 well pad, located in the northeastern National Petroleum Reserve-Alaska, as a satellite of the Alpine oil field, connected to Alpine by a gravel road and pipeline via the CD-5 well pad.

Up to 30,000 barrels per day

Production from GMT-1 is expected to peak at 25,000 to 30,000 barrels of oil per day from the upper Jurassic Alpine C sandstone. The development involves a combination of BLM, Arctic Slope Regional Corp. and Kuukpik land rights. Permitting for GMT-1 began in 2013, with the Bureau of Land Management issuing a permit to drill in October 2015. ConocoPhillips approved funding for the project in that same year, and construction began in 2017.

“This is another milestone for development in the NPR-A,” said Joe Marushack, president of ConocoPhillips Alaska, when announcing the start of production. “The GMT-1 team successfully and safely executed this project in an environmentally responsible manner. We appreciate the collaboration with stakeholders from Kuukpik Corporation, the community of Nuiqsut, the North Slope Borough and ASRC that made it possible.”

“The onset of oil production at GMT-1 is good news for Alaskans who will benefit from new jobs and increased production in the trans-Alaska pipeline,” said Gov. Bill Walker. “The Department of Natural Resources played a key role in permitting this project and is working with industry, local communities, and federal agencies on other promising oil prospects in the NPR-A.”

The GMT-1 development involves an 11.8-acre drilling pad, with a 7.6-mile road to the CD-5 pad. The GMT-1 pad can support up to 33 wells, although initially it will only have nine wells. ConocoPhillips says that it anticipates the development having a total cost of about $725 million, including the cost of construction and drilling. Peak construction during the past two winters created about 700 jobs.

Chain of developments

The project constitutes one of a chain of developments that ConocoPhillips is undertaking, progressively stepping out west into the northeastern part of the NPR-A from the Colville River delta. The idea is that, by gradually extending the oil infrastructure west, each new project becomes economically viable. The process began with the CD-5 development, the first well pad inside the NPR-A - CD-5 went into production in late 2015. GMT-1 is the next project in the sequence, to be followed by GMT-2, about eight miles southwest of GMT-1. BLM has published a final EIS for GMT-2 - ConocoPhillips now waiting for a BLM record of decision for that project.

The company says that construction for GMT-2 could begin in early 2019. Because GMT-2 has more wells than GMT-1, ConocoPhillips thinks that GMT-2’s cost, estimated at more than $1 billion, will be higher than the cost of GMT-1. However, the GMT-2 anticipated peak production, at 35,000 to 40,000 barrels per day, will also be higher.

Willow

The behemoth at the western end of the current chain of ConocoPhillips NPR-A developments is Willow, in the Bear Tooth unit. With an estimated peak production rate of 100,000 bpd, ConocoPhillips plans to develop Willow as a standalone field, with its own production facilities, rather than as another Alpine satellite. Scoping for the environmental impact statement for Willow is underway, with first production anticipated around 2024-25, if the development goes ahead. Initial development would likely cost $2 billion to $3 billion, with a further $2 billion to $3 billion required for full field development, ConocoPhillips has indicated.



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