After a pair of disappointing wells in 2013, and maintenance work in 2014, Aurora Gas LLC expects to renew efforts at Nicolai Creek next year based on new seismic work.
The Alaska-based independent drilled the Nicolai Creek No. 13 and No. 14 wells in August and July 2013, respectively. Based on the success of previous wells, the company had expected those two wells to yield an average production bump of 3 million cubic feet per day, according to Aurora Gas President Ed Jones, but “neither of the development wells resulted in commercially viable accumulations of hydrocarbons and were plugged and abandoned,” according to a plan of development for the year ending in October 2014.
While Aurora did not drill any wells or perform any rigged well work in 2014, the company recently completed several coiled tubing cleanouts and might perform more before the end of the year, according to Jones. “We are awaiting a review of seismic to confirm and prioritize these several drilling possibilities - we are expecting to have a more active year in 2015,” Jones told Petroleum News by email in September 2014.
Among the possibilities is a Nicolai Creek No. 12 well, which the company had initially floated as a possibility for its current plan of development but ultimately deferred. The well would target deeper sands not accessible through Nicolai Creek No. 10 or No. 3.
Nicolai Creek acquired in 2000
Aurora acquired the Nicolai Creek unit in 2000 through a trade with Marathon Oil Co., giving up a working interest at Kenai and Cannery Loop in return for operatorship.
“We essentially traded a modest quantity of proved developed producing reserves at Kenai and Cannery Loop for a larger quantity of proved undeveloped reserves at Nicolai Creek,” Aurora Power President G. Scott Pfoff told Petroleum News in January 2000.
Between 1968 and 1977, Nicolai Creek produced fuel gas for offshore platforms. Later, a pipeline connected the field to the regional grid. But in the early 1990s a former operator killed the best producing well - Nicolai Creek Unit No. 3 - with drilling mud.
Aurora restarted production in late 2001, after cleaning out the well. In subsequent years, the company also restarted production from the Nicolai Creek No. 1B and No. 2 wells and drilled the Nicolai Creek No. 8 well, which is now known as Nicolai Creek No. 9.
After having to suspend production for parts of 2005, 2006 and 2007 because of commercial disputes involving marketing its product, Aurora brought the Nicolai Creek No. 11 well online in late 2009 and drilled the Nicolai Creek No. 10 well in 2011.
The results of those wells were what prompted optimism for No. 13 and No. 14.
Averaging monthly production, Nicolai Creek produced some 1.4 million cubic feet per day in July 2014, according to the Alaska Oil and Gas Conservation Commission.
Cumulatively, the unit produced some 8.5 billion cubic feet through July 2014.
Four smaller fields
The utility Aurora Power Resources Inc. created Aurora Gas in 2000 as an exploration and production arm, and Aurora Gas began acquiring properties soon thereafter.
Eventually, Aurora amassed a portfolio of shallow natural gas prospects - developed and undeveloped - located predominately on the west side of Cook Inlet.
Today, the local independent operates five gas fields on the west side of Cook Inlet: Nicolai Creek, Lone Creek, Moquawkie, Albert Kaloa and Three Mile Creek. Averaging cumulative production, Aurora Gas produced some 2.7 million cubic feet per day in July 2014.
Aurora gets about half of its total production from Nicolai Creek and about half from its other four fields - Lone Creek, Moquawkie, Albert Kaloa and Three Mile Creek.
The company acquired Lone Creek and Moquawkie from Anadarko in 2000. Anadarko and ARCO Alaska discovered Lone Creek in the late 1990s. Aurora brought the field online in summer 2003, producing 5 mmcf per day from the original discovery well.
In 2005, Aurora offset Lone Creek No. 1 with the Lone Creek No. 3 well, which tested at 16.4 mmcf per day. The following year, Aurora recompleted several wells, including Lone Creek No. 1, describing the venture as a moderate success. After its two-year hiatus, Aurora returned to the field in 2009, drilling the Lone Creek No. 4 well.
Averaging the monthly production rate, Lone Creek produced some 952 thousand cubic per day in July 2014 and some 10.3 billion cubic feet, cumulatively, through July 2014.
Concurrent with its efforts at Lone Creek, Aurora also developed the Moquawkie field, which is adjacent to Lone Creek along its southern border. The two prospects primarily consist of Cook Inlet Region Inc. acreage, and their management is intertwined. The Moquawkie field produced some 176 thousand cubic feet on average in July 2014 and nearly 5 billion cubic feet, cumulatively, through July 2014, according to the AOGCC.
Pan American Petroleum Co. discovered the Albert Kaloa natural gas field in 1967 while searching for oil. The company brought the Kaloa No. 1 discovery well online in 1970 but suspended operations the following year after sand and mud plugged the well.
In 2004, Aurora drilled Kaloa No. 2. The well was successful and Aurora and returned the field to production in October of that year. Buoyed by its success, Aurora drilled the Kaloa No. 4 in 2005 and the Kaloa No. 3 in 2009, but both wells were dry holes.
Albert Kaloa is located between the Nicolai Creek and Moquawkie units.
Averaging monthly production rates, the field was producing some 23.5 thousand cubic feet per day in January 2014 but appeared to be offline in July 2014. Cumulatively, the field produced some 3.6 billion cubic feet through July 2014, according to the AOGCC.
The Three Mile Creek field is a little ways to the north.
In 2004, the state approved the Three Miles Creek unit over some 9,200 acres of state of Alaska, Alaska Mental Health Trust and Cook Inlet Region Inc. leases. The unit agreement required Aurora and partner Forest Oil to drill two wells and shoot seismic.
Three Mile exploration well
Aurora drilled the Three Mile Creek No. 1 well in late 2004. It was the first exploration well for the company and tested at 5 mmcf per day from two Beluga intervals. Aurora brought the field online in August 2005 and drilled the Three Mile Creek No. 2 delineation well in November 2005. Aurora deferred a third Three Mile Creek well.
In 2006, Aurora performed an acid stimulation of the Three Mile Creek No. 2 as part of its recompletion activities. In 2008, after the hiatus, Aurora recompleted Three Mile Creek No. 2 to perforate some additional zones. Aurora hydraulically fractured the well in 2010 to improve production from the thin layers of productive sands in the Beluga.
The successful program led Aurora to consider using the technique at its other wells.
Forest sold its Alaska assets, including Three Mile Creek, to Pacific Energy Resources Ltd. in 2007, but Pacific Energy filed for bankruptcy protection in 2009. The Miller Energy Resources-subsidiary Cook Inlet Energy acquired the minority stake in late 2009.
Averaging monthly production, Three Mile Creek produced nearly 190 thousand cubic feet per day in July 2014. Cumulatively, it field produced some 2.4 billion cubic feet through July 2014.
