Vol. 26, No.3 Week of January 17, 2021
Providing coverage of Alaska and northern Canada's oil and gas industry

Oil patch insider: Talitha well spud; ANWR outsider; All not dire for oil under Biden

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Kay Cashman

Petroleum News

Pantheon Resources plc, the AIM-quoted oil and gas exploration company with working interests of 89.2% to 100% in Great Bear North Slope projects, said it spud the Talitha A well ahead of schedule on Jan. 13. The well, which the company describes as an appraisal well and the state labels an exploration well, is some 8 miles west of the trans-Alaska oil pipeline and Dalton Highway Milepost 386.7.

Drilling is planned to a total vertical depth of approximately 10,000 feet and will “target the shallowest Shelf Margin Deltaic horizon as the primary objective and will also drill through a number of secondary objectives including: (i) the ‘Slope Fan System’, (ii) the ‘Basin Floor Fan’, and (iii) the ‘Kuparuk’ horizons,” Pantheon said.

Given the number of targeted formations, and subject to positive results, Pantheon intends to make full use of the available winter drilling window, “undertaking drilling and testing operations as long as weather permits.”

The Talitha A well is four miles from the Pipeline State 1 well, drilled in 1988 by ARCO, and which confirmed the presence of movable hydrocarbons in the objective horizons.

“The close proximity to pipeline and transportation infrastructure offers Pantheon a number of material advantages over other Alaska North Slope projects, including lower capex costs and shorter project development timelines.,” the company said.

Pantheon estimates the Talitha well will target approximately 1 billion barrels of recoverable oil across the multiple stacked (primary and secondary) objectives. An independent expert’s report was completed on the updip section of the Shelf Margin Deltaic, the primary target, and confirmed a prospective resource of 302 million barrels of recoverable oil, the company said.

The Talitha A well “has been positioned to intercept our primary and shallowest objective, the Shelf Margin Deltaic, in the optimum location, structurally higher (updip) from the Pipeline State 1 discovery well where oil shows, logged pay and free oil in the mud pits were encountered in this and other zones. Our modelling predicts better reservoir qualities for the SMD in Talitha A’s updip location and our other target zones,” said Bob Rosenthal, Pantheon’s technical director.


An outsider in ANWR

Mark Graber’s Knik Arm Services LLC took tract 25 in the Jan. 6 lease sale in the 1002 area of the Arctic National Wildlife Refuge.

Graber, an Alaska resident, describes himself as a real estate investor rather than an oil man.

“I’m just kind of an outsider, really,” he said. “I had a little experience in a couple of oil and gas investments.”

Graber drew on his experience for the ANWR sale.

“Being in real estate, you look at this thing as being in the sticks of the rights of real estate ownership - basically the mineral rights - and my group looked at it as a glorified real estate play,” he said.

Graber said he was gratified to see that AIDEA bid on “all the blocks that everybody probably recognized as the highest potential,” west of the Marsh Creek anticline.

But Graber was disappointed that only one other oil company bid in the sale. He said he rationalized that oil companies had lived through a near-death experience in 2020; oil prices were markedly lower when the sale was announced in December; the timing was bad; the sale was rushed; there was political risk.

Also, he thought, with AIDEA bidding, the companies had an option to wait until timing was better to acquire the leases.

Graber said he did not hire a geologist to choose his tract due to lack of data.

“We studied everything we could on what’s available out there, which is not a lot … all I got is that old 2D seismic and whatnot,” he said. “Nobody has real information, that means we’re all on a level playing field; everybody’s blind.”

Graber said he focused on five or six tracts to the west of and within a 15-mile radius of the Marsh Creek anticline.

“Tract 25 has as much prospects in it percentagewise as any of the tracts,” he said, adding that there was another tract the group liked better, but they were intimidated to bid on it, thinking they didn’t have a chance.

Graber said his investors are risk takers that want to be a part of something big, and ANWR has super potential - a 6-to-7 billion-barrel mean estimate.

“It’s just blows your mind big, and it’s right there near infrastructure,” Graber said.

“I’ve got a lot of my own money in this,” he said. “I’m not just the front man.”


All not dire for oil under Biden

While a Democrat controlled White House and Congress will be busy working to undo many of the Trump administration’s policies, political experts say a Biden administration and lawmakers will be hard-pressed to reverse several of President Trump’s policies, including those on the environment, structural changes to the government itself and oil drilling on federal land.

A Jan. 13 Newsmax analysis said experts agree an instantaneous reversal of all Trump policies is highly unlikely, especially because Democrats hold such a narrow majority in the Senate: “Democrats can’t lose any support from lawmakers in their own party and will have to win over some Republicans in order to overturn certain policies implemented by the Trump administration. What’s more, any legal challenges filed over their changes will be met with a conservative-leaning Supreme Court.”

“Many moderates are scared of doing anything to change the structure of the U.S. government fundamentally,” Los Angeles-based GOP political strategist Anthony Angelini told Newsmax, noting he thinks any attempts to pack the Supreme Court or eliminate the Senate filibuster will likely be “dead on arrival.”

Democrat Sen. Joe Manchin of West Virginia has announced his opposition to court packing and ending the filibuster.

Houston-based GOP political strategist Vlad Davidiuk said even with control of Congress, any overhaul to Trump’s environmental regulation and oversight policies by a Biden administration will likely be difficult.

“According to Davidiuk,” Newsmax wrote, “changes made to personnel at both the federal and state levels will make change hard to implement. Trump vowed to cut back on a swath of environmental regulations by loosening rules. Any changes that might require a full review process complete with public comment could take a considerable amount of time.”

Over the last few months, Trump issued thousands of drilling permits, which would “sideline Biden and the Democrats’ plan to curb the amount of new oil drilling that takes place on federal, public land,” Newsmax wrote.

The media outlet quoted data from the U.S. Bureau of Land Management showing that “more than 3,000 drilling permit applications were submitted in a three-month period that included November’s presidential election. Of the permits requested, 1,400 were approved (as of the end of December). The approvals mean drilling will take place for years unless Biden wants to undergo the costly process of forcing companies to relinquish their drilling rights.”

Newsmax noted that Biden’s pick for interior secretary, New Mexico Rep. Deb Haaland, has “vocally opposed fracking and drilling on public land.”


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