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Vol. 18, No. 3 Week of January 20, 2013
Providing coverage of Alaska and northern Canada's oil and gas industry

Point Thomson gets going

New field construction on Alaska’s eastern North Slope cheers state officials

Wesley Loy

For Petroleum News

Work to establish a new oil field at Point Thomson on Alaska’s North Slope is starting to roll.

ExxonMobil, operator of the Point Thomson unit, has a variety of activities under way to take advantage of the winter construction season.

The work includes building an access road to the remote eastern North Slope field, and assembling hundreds of “vertical support members” on which a planned Point Thomson pipeline will be mounted.

ExxonMobil has secured all the major permits for the long-awaited Point Thomson project.

“Depending on weather conditions, our winter construction season will likely run until late April or early May,” Kim Jordan, an ExxonMobil spokeswoman in Houston, told Petroleum News in a recent email. “Our work this winter will focus on infrastructure development. Planned on-site activities include constructing gravel roads, an expanded site pad, construction camps, and an airstrip. Pipeline support members also will be installed along the pipeline right of way. We will also construct an ice road from Badami to our Point Thomson site — approximately 22 miles long. All construction activities will be conducted with mitigation measures in place to minimize impact on tundra, wildlife, aquatic resources and subsistence activities.”

Long time coming

Seeing construction at Point Thomson will be a delight for Alaska officials, who have pushed ExxonMobil and its partners for decades to develop the Point Thomson field.

Major stakeholders in the Point Thomson unit include BP and ConocoPhillips.

Although rich in natural gas and petroleum liquids, the field hasn’t seen any production since its discovery in the 1970s. The lack of a multibillion-dollar North Slope gas pipeline has been the main impediment to development.

Under a legal settlement with the state, ExxonMobil is moving ahead with a modest, though expensive, initial development. The project involves “cycling” natural gas to collect condensate, a light hydrocarbon.

The condensate is a liquid that can flow like oil through pipelines. ExxonMobil aims to produce 10,000 barrels per day initially, and has pledged field startup by May 2016.

The Point Thomson development is a big enough deal that it merited prominent mention in Alaska Gov. Sean Parnell’s Jan. 16 State of the State address.

“For the first time, development of Alaska’s eastern North Slope is under way,” Parnell said. “It means billions in new investments. It means 600 to 700 new sustained jobs, and it means progress toward a gas line project.”

Point Thomson is about 60 miles east of Prudhoe Bay, along the Beaufort Sea coast next to the Arctic National Wildlife Refuge. State officials hope that extending oil and gas infrastructure including the Point Thomson pipeline to the eastern Slope will encourage other developments in the area.

Point Thomson holds an estimated 8 trillion cubic feet of gas, or about a quarter of the known gas reserves on the North Slope.

Numerous contractors

ExxonMobil has dozens of contractors at work on aspects of the Point Thomson development.

Australian firm WorleyParsons in January 2012 announced ExxonMobil had awarded it a contract for engineering, procurement and construction.

“WorleyParsons, working with Fluor, will provide overall project management and EPC services,” WorleyParsons said.

The Point Thomson development will consist of three well pads, a barge dock and the 22-mile “export pipeline” to carry Point Thomson production west, linking with BP’s Badami pipeline.

Brawny gas processing, compression, utilities and power generation modules will be needed. ExxonMobil’s Jordan could not say who will build the modules, or where.

Ultimately, the modules will be moved via sealift to the Point Thomson field.

At the Alaska Support Industry Alliance’s Meet Alaska conference on Jan. 11 in Anchorage, Steve Butt, a senior project manager with ExxonMobil Development Co., showed photos of ice road construction, vertical support members being hoisted off a ship in Seward, and camp modules being staged at Deadhorse.

“It’s ready to move forward,” Butt said of Point Thomson.

The company plans to use proven “plug and play technology” to mate up the modules once delivered to Point Thomson, Butt said.

ExxonMobil already has drilled a pair of wells at Point Thomson. Originally, one was planned as a gas producer and the other an injector working in tandem to cycle the gas.

That plan has changed, however, due to the discovery of higher levels of potentially damaging sour gas than expected. ExxonMobil has told the state the wells weren’t designed for “sour service.”

With liners installed, the wells can function as injectors, but a third well will need to be drilled as the initial Point Thomson producer, the company said.

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