Glacier Oil sold
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Pontem and SEP team up to drive new Alaska oil and gas production
Kay Cashman Petroleum News
On Jan. 9, Glacier Oil & Gas, an independent oil and gas company focused on the exploration and production of Alaska resources from the North Slope to the Cook Inlet, announced that Pontem Energy and Sweat Equity Partners, or SEP, acquired 100% ownership in Glacier.
Glacier owns and operates upstream and midstream assets in Alaska that produce approximately 2,500 barrels of oil per day in the North Slope at the Badami unit, in the Cook Inlet basin at 1) the West McArthur River unit and 2) off the Osprey Platform at the Redoubt unit.
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Originally built at costs that exceeded $500 million, Glacier’s assets have produced more than 31 million barrels of oil over the past 25 years. Using recent third-party estimates, Glacier’s fields contain more than 9 million barrels of remaining proven reserves.
“We are excited by the opportunities that lie ahead for Glacier, its employees, and its new financial backers, Pontem and SEP,” Glacier President Stephen Ratcliff said.
“Over the last couple years, we have remained committed to building Glacier during the pandemic while working diligently on production enhancement operations, plans for drilling additional wells, evaluating capital enhancement options, and better alignment through vested ownership. We are excited that this acquisition aligns our vision of growth through development drilling and increased production, maintains our strong corporate culture and our team, and provides an avenue to develop the Glacier brand as a sustainable and long-term player in … Alaska,” Ratcliff said.
Pontem’s Managing Partner Jeff Bartlett said: “We are thankful for Glacier’s prior owners’ focus on safety, environmental stewardship and for positioning the company to capitalize on its remaining growth opportunities during today’s improved commodity price environment. Such investment will benefit Glacier’s employees, its operating partners and oilfield service providers while generating additional royalty income for the State of Alaska.”
SEP’s President Andrew White stated, “We invest in management teams who build culture to attract and retain the best employees and who understand how to profitably, and sustainably, grow their business. Stephen and his team at Glacier have proven their leadership in safety culture with no lost time accidents in eight years and in operating culture with consistently strong environmental and financial results.”
White said Ratcliff’s team has a “clear strategy: to build Glacier into the preeminent Alaskan oil and gas operator, and I look forward to working with them to achieve their goals.”
Bracewell provided legal representation to Glacier during the transaction while King & Spalding provided legal representation to Pontem and SEP.
For more information about Glacier go to: www.GlacierOil.com.
For more information about Pontem, which provides capital solutions for and consulting services to the upstream and midstream energy sectors, go to www.pontemec.com.
For more information about Sweat Equity Partners, which is an entrepreneur-led family of companies in domestic energy, CleanTech, PropTech & SaaS, go to www.SEPLP.com.
Savant looking to drill Petroleum News’ annual Producers magazine, released on Nov. 13, reported that Savant Alaska, a Glacier company, was looking to drill in its North Slope Badami unit, but the ability to do so was reliant on finding funding and economic conditions, including the price of oil.
BP Exploration (Alaska) Inc. brought the North Slope oil field, which lies between Prudhoe Bay and the Point Thomson unit, into production in 1998.
The reservoir at Badami was compartmentalized, making it difficult to develop in the usual manner. BP had to frequently suspend operations to let reservoir pressure recharge.
BP developed the unit with a processing facility capable of handling 38,500 barrels per day of oil. But by the mid-2000s, average production was down to 876 barrels per day.
Taking a different approach, BP partnered with the small independent Savant Alaska in 2008 and then sold the field. Savant then became a subsidiary of Glacier.
In its decade overseeing the unit, Savant has stabilized production with two successful development wells: B1-38 and the B1-07 Starfish well. With production averaging around 1,100 barrels per day, Badami production remains well below original estimates, but is much healthier than the stop and start days of the turn of the century.
Outside the boundaries In development plans filed with the State of Alaska, Glacier has often mentioned opportunities around its existing property - prospects just beyond the unit boundaries or just outside existing participating areas.
In its last development year, Savant completed several maintenance projects at Badami.
The company conducted gas lift optimization on the Starfish B1-07 well, which improved production by some 15%.
Savant also conducted production logging on the B1-36 well, which help identify and mitigate water intrusion into the well. In April 2022, it added 47 feet of perforations to the B1-36 well.
In its current plan of development, running through July 15, 2023, Glacier subsidiary Savant proposed a range of small development projects, all reliant on funding, oil price, etc.
Savant told the State it plans to log the B1-38 well and possibly add perforations in the Brookian section of the reservoir, in addition to the existing production from the Killian.
Badami East For several years, Savant has been evaluating prospects in the Badami and Killian sands at the unit. The company has identified several prospects in these two sands.
Of those prospects, three could be drilled from the existing Badami pad but the remainder would require construction of a new drilling pad, currently being called the Badami East pad.
The Badami East pad would be a satellite, connected back to the main Badami pad by an 8-inch three-phase production pipeline and a 2-inch gas supply pipeline.
Savant wanted to advance the project as part of a multi-well drilling program in the Lion and Rhino Killian prospects. But given the uncertainty of economic conditions in 2020 and 2021, the company deferred the drilling, as well as the pad.
In the current plan of development, approved by the State of Alaska in June, Savant was looking to drill at least one well into the Killian 28 reservoir this coming winter.
Savant also planned to conduct geologic evaluations to identify potential drilling targets on 1,280-acres of newly acquired property south of the existing Badami unit.
The current development plan also includes some facility work. Savant wants to relocate a newly installed wastewater treatment plant to improve access and operations at the Badami main pad, to upgrade a communications system, and to convert some of its propane-powered thermoelectric generators to run on natural gas.
But these plans from the November Producers magazine were not listed in Glacier’s Jan. 9 report to Petroleum News, so stay posted for further information from the company.
Cook Inlet basin The same is true for Glacier’s operating company in the Cook Inlet basin, Cook Inlet Energy, which has been analyzing options at the Redoubt unit and at the West McArthur River unit, per the Producers magazine.
The two offshore units are classic Cook Inlet properties: aging stalwarts in need of regular investment but also capable of significant growth.
In June 2020, with the delivered spot price of Alaska North Slope crude oil hovering around $30 to $40 per barrel, the state allowed the Glacier subsidiary to suspend operations at West McArthur River and Redoubt.
Cook Inlet Energy, or CIE, brought the two units back online in the fourth quarter of 2021 and is now working under its second full development plan for the units since that restart.
Stewart Petroleum Co. brought the West McArthur River unit online in the early 1990s. The offshore unit currently includes 6,970 acres, 11 wells and two participating areas. Operators came and went until CIE acquired the property in 2009.
West McArthur River’s current plan of development runs through April 2023.
The unit’s most interesting exploration prospect is Sabre in a corner of the unit.
Former Cook Inlet operator Forcenergy shot 3-D seismic over Sabre, describing it as a 50 million to 100 million barrel prospect.
The project has been delayed by the difficulty of drilling an extended reach well from onshore, but with the arrival of a jack-up rig in Cook Inlet, the cost of exploration has reportedly come down.
Redoubt discovered 1960s Pan American discovered the Redoubt Shoal field in the late 1960s. The Redoubt unit was formed in 1997 with production from the Hemlock participating area.
CIE acquired the unit in 2009.
The overall program at Redoubt is similar to West McArthur River: maintenance on existing wells, plans to address high water volumes and prospects for expansion.
As part of its previous plan of development, the company undertook a wide range of maintenance projects.
As with the Sabre prospect at West McArthur River, CIE deferred work on a proposed development at an expansion property called the Northern fault block. In its current plan, the company said it “plans to keep its options open” at both the Northern and Southern fault block by seeking partners to reduce the risk factors for development.
Associated with Redoubt are the Osprey platform and the onshore Kustatan Production Facility.
The company recently installed a new subsea pig launcher on the pipeline to the platform. In its current plan, CIE is planning inspections and upgrades at these two facilities.
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