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Vol. 23, No.28 Week of July 15, 2018
Providing coverage of Alaska and northern Canada's oil and gas industry

Jack-up on site

Furie planning completion of two more Kitchen Lights gas production wells

Alan Bailey

Petroleum News

Furie Operating Alaska is planning to complete one well and drill another, to achieve a target of having a total of four production wells on line in its Kitchen Lights gas field in Cook Inlet by the end of this year’s drilling season, Scott Pinsonnault, the company’s chief operating officer, told Petroleum News July 9. The Spartan 151 jack-up rig is on site at the Julius R. production platform, being cantilevered over the platform.

“They’ve been rigging up ... for the last five or six days,” Pinsonnault said.

Development wells

The field is currently producing gas from the KLU Nos. 2 and 3 wells - in April Furie used a coiled tubing unit to conduct a workover of the No. 3 well.

“We’re currently producing around 17 million (cubic feet) a day out of two wells,” Pinsonnault said.

The plan now is to complete the KLU No. 1 well that was drilled but not completed in 2016, before proceeding to drill another development well, the KLU No. 4 well. And so, Furie’s expectation is to have four producing wells for the Kitchen Lights field by November, Pinsonnault said. This year’s development drilling will satisfy the contractual requirements associated with a gas supply agreement with Enstar Natural Gas Co.

As a development well, the KLU No. 4 well will target gas in the Sterling and Beluga formations. However, Furie also hopes to extend the drilling down into the Tyonek formation, as an exploration venture, Pinsonnault said.

Augmenting staff

The company has been augmenting its staff, adding a new vice president of operations and an HSE official, and has contracted with Petrotechnical Resources of Alaska to act as its technical arm, Pinsonnault said.

Petroleum News understands that Bruce Webb, who had been the company’s senior vice president, left the company at the end of May.

In its most recent drilling, in 2016, Furie had been using the Randolph Yost rig, which is currently moored at Nikiski, on the Kenai Peninsula. However, PRA issued a request for proposal for this year’s drilling: the result is the use of the Spartan 151, which had been moored in Seward. Pinsonnault expressed a view that, given the amount of potential offshore drilling in the Cook Inlet, there would be advantage in having a rig continuously available in the region.

“It’s my belief that the operators in the inlet should retain a rig for future activity,” Pinsonnault said.

Delivering on commitments

With outstanding commitments, both in terms of gas supplies and in terms of the Kitchen Lights plan of development, Furie’s current focus is to deliver on those commitments.

“It’s been a tremendous effort to get where we are in 90 days, to mobilize, permit, define the operational tempo for the summer,” Pinsonnault said. The company had acquired something of a reputation for promising more than it has delivered, he said.

“Our primary goal at the company now is to change that,” he said.

And the company has adequate funding for this year’s work, with Energy Capital Partners, the company’s lender, investing more money in the Kitchen Lights venture. Furie is also waiting to see what happens in relation to past tax credits due to the company, following the recent signing by Gov. Walker of the bill authorizing the use of bonds to reimburse for the credits.

There is continuing exploration potential in the Kitchen Lights unit, including the possibility of drilling deep for oil in the Jurassic strata that underlie the Tertiary rocks that host producing oil and gas fields in the Cook Inlet basin.

“We’re currently taking a holistic look at the Kitchen Lights unit to define what the art of the possible is and factor that into our communications with the state … and what we need to submit to them,” Pinsonnault said. “That’s work that’s underway. We’ve got to submit a new plan of development in October, and our goal is to define what we think is possible.”

Development history

The history of the Kitchen Lights gas field development dates back to November 2011, when Escopeta Oil Co. announced the discovery of a huge gas field during the drilling of the KLU No. 1 well from the Spartan 151 rig. The announced size of the find was later scaled back, although the field is clearly substantial.

In 2012 Escopeta spawned Furie and Cornucopia Oil and Gas Co., Furie’s owner company. And in the summer of that year, Furie re-entered the No. 1 well to continue drilling. Later during the drilling season, the company stopped drilling that well and started drilling the KLU No. 2 well, another exploration well. By the end of that year the company had started the permitting process for installing an offshore gas production platform in the Kitchen Lights unit, envisaging twin pipelines to shore and an onshore production facility.

In 2013 Furie drilled the KLU No. 3 well, not far from the No. 1 well, to further appraise the gas discovery. And in the summer of 2015 Furie installed the Julius R. production platform, together with a single subsea pipeline for delivering gas to an onshore gas processing facility. The company formed a gas supply agreement with Homer Electric Association and, in December 2015, the field went on line, producing from the No. 3 well.

Enstar agreement

In 2016 Furie signed a gas supply agreement with Enstar - that agreement was contingent on the drilling commitments that Furie is now focusing on completing. In the summer of that year Furie used the Randolph Yost rig to drill the KLU No. A-2 well, with that well going into production in the fall. Furie also drilled the KLU No. A-1 well that year but was unable to complete that well before the end of the drilling season.

In 2017 Furie said that the Randolph Yost rig would complete the A-1 well before drilling the KLU No. 6 well, an exploration well that would target a deep Jurassic prospect - the rig was large enough to conduct the required deep drilling. But that 2017 drilling never happened, with Furie blaming the state’s hiatus in the payment of tax credits for the suspension of the drilling activity.

The pause in the drilling has now clearly ended, with Furie intent on bringing its offshore gas field into full operation.



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