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Rig for Doyon’s Totchaket No. 1 being assembled north of Nenana
Alan Bailey Petroleum News
Assembly of the drilling rig is underway for Doyon Ltd.’s planned Totchaket No. 1 exploration well in the Nenana basin, at a location north of the town of Nenana in the Alaska Interior, James Mery, Doyon senior vice president for lands and natural resources, told Petroleum News in a May 25 email. Doyon anticipates drilling starting no later than June 10, Mery said. The corporation is using the Nabors 105 rig for the drilling project. The Alaska Oil and Gas Conservation Commission has issued a permit for the drilling of the well.
Cook Inlet Region Inc. is partnering with Doyon for the project. State tax credits also support Doyon’s exploration program.
Looking for oil Doyon’s primary objective for the well is the discovery of a viable oil resource in the basin. The corporation has previously indicated that, given the convenient location of the project site, relatively close to the transportation corridor to Fairbanks, a development could be viable at an oil price of around $50 per barrel, even with a relatively small discovery of perhaps 40 million to 60 million barrels. If a workable oil resource is discovered this summer, production could begin around 2023 to 2025, or perhaps earlier if oil were to be shipped by truck or rail to the oil refinery at North Pole, or to a trans-Alaska oil pipeline pump station.
The target of the drilling, the Totchaket East prospect, is also highly prospective for natural gas. Seismic data, in particular 3-D data gathered in 2017, exhibits amplitude anomalies that suggest the presence of natural gas or light oil at multiple horizons - gas could potentially be brought on line earlier than oil. But Doyon does not currently see any market for gas from the basin, especially given current plans to ramp up deliveries of liquefied natural gas to Fairbanks under the Alaska Industrial Development and Export Authority’s Interior Energy Project. Mery has previously said that, if a significant gas resource is found in the Nenana basin, the gas could be delivered to Fairbanks at a city-gate price significantly lower than that anticipated by the IEP.
However, the basin is located close to the proposed route of a gas export pipeline from the North Slope - delivery of Nenana gas to market through that line may be a future possibility.
Previous drilling Doyon has already drilled three wells, to the west of Nenana, in the central part of the Nenana basin. Those wells targeted prospects in a relatively shallow saddle in that central region. The concept was that oil or gas generated in a deeper section of the basin would flow upward into the saddle, where it would become trapped. In the event, the wells found tantalizing evidence for an active petroleum system, with oil shows and the presence of so-called wet gas that must have been generated thermally at some depth. Two of the wells found evidence of breached hydrocarbon reservoirs - the breaching may have occurred as a consequence of the uplift of the rock strata in the basin’s central section.
The drilling of the Totchaket well represents a change of exploration strategy, with Doyon now targeting prospects over the deep, northerly section of the basin. The depth of the basin in this region appears sufficient to raise the rocks to high enough temperatures for oil formation. Potential oil and gas source rocks consist of prolific coal seams and coaly shales. There are abundant sand units that could act as hydrocarbon reservoirs, while there are also impervious horizons that could act as reservoir seals.
Drill to 13,000 feet The plan is to drill to a depth of about 13,000 feet, to penetrate potential reservoirs above the possible oil and gas kitchen. Seismic data have shown hydrocarbon indicators between depths of around 4,500 and 9,500 feet.
During the past winter Doyon built the gravel pad for the Totchaket drilling, as well as a gravel access road to the pad from the nearby Tanana River. A fleet of barges and crew boats will service the drilling operation, with the main personnel camp being located in Nenana.
The corporation is starting the drilling relatively early in the summer season, to accommodate time for well testing, and for the drilling of a sidetrack or second well, should a discovery be made.
- ALAN BAILEY
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