Providing coverage of Alaska and northern Canada's oil and gas industry
September 2023

Vol. 28, No.38 Week of September 17, 2023

Nuna work progresses

ConocoPhillips Alaska takes another step, applies for Torok PA in Kuparuk unit

Kay Cashman

Petroleum News

On Aug. 31, ConocoPhillips Alaska Inc. applied for a Torok participating area in the Kuparuk River unit, a move that followed its June 1 announcement that funding had been approved for developing the Nuna project from Drillsite 3T, or DS 3T, on the northwestern edge of the unit.

(See map in the online issue PDF)

Development of Nuna through existing Kuparuk River unit facilities will minimize environmental impacts because "the tract owners will not have to build stand-alone processing facilities solely for the benefit of these areas," the company said.

Nuna drilling is scheduled to start in late 2024. First oil is anticipated by early 2025, with an expected peak oil rate of some 20,000 barrels per day, per CPAI.

In the company's Torok PA application CPAI asked Alaska's Division of Oil and Gas to make the new participating area effective as of Dec. 1, 2022. It appears the proposed PA extends beyond in Nuna prospect.

Two years earlier, on Aug. 14, 2019, the division approved the 12th expansion of the Kuparuk River unit, incorporating 19,177.50 acres in Torok PA leases, effective June 1, 2019. Those leases had just been acquired via a purchase and sale agreement between CPAI and Caelus Natural Resources Alaska LLC.

The Nuna prospect was originally associated with the Oooguruk unit but could be accessed from existing facilities at Oliktok Point, located within the Kuparuk River unit.

Based on an initial exploration program at Nuna in 2012, then-leaseholder Pioneer Natural Resources estimated ultimate oil recovery between 75 million and 100 million barrels of oil from the Torok formation of the Brookian sequence at Nuna. Caelus later estimated that Nuna could produce 25,000 barrels of oil per day over 20-30 years. (Pioneer discovered Nuna in 2012 and drilled two exploration wells before selling the prospect to Caelus in 2014. Caelus installed the pad.)

Caelus sanctioned a $1.4 billion Nuna development in 2015, underpinned by royalty modification from the state. But the company postponed the project because of economic concerns and ultimately sold the Oooguruk unit to minority partner Eni and the Nuna satellite to CPAI.

In mid-2021, ConocoPhillips announced the Coyote discovery east of Nuna. At the time, ConocoPhillips Alaska President Erec Isaacson said Coyote was in the Brookian topset above the Nuna Torok discovery, describing Coyote as shallow, i.e. a Nanushuk play.

The Torok PA will be the first participating area within the Kuparuk River unit to target the Torok formation, also dubbed the Torok (Moraine) by CPAI.

"The Torok (Moraine) formation within the Torok PA are owned by Kuparuk River unit owners in the following percentages," paperwork attached to the application said:

CPAI/CPAI II participating interest 94.6846% and capital interest 95.67472%

Chevon participating interest 4.95060% and capital interest 3.96048%

ExxonMobil participating interest 0.36480% and capital interest 0.36480%"

Attachment A

DNR regulations at 11 AAC 83.351 say that a participating area may include only the land reasonably known to be underlain by hydrocarbons and known or reasonably estimated through the use of geological, geophysical, or engineering data to be capable of producing or contributing to the production of hydrocarbons in paying quantities.

In its Torok PA application, CPAI provided proof of this from two wells: the 1992 ARCO Kalubik No. 1 exploration well and a 2022 Moraine well located in Sec. 12, T12N, R7E, UM, Alaska. The Kalubik well logs put the upper Torok interval at approximately 8,400 feet.

Attachment A in the application describes CPAI's development plans for the Torok PA, but the company requested that the attachment be held confidential by the division "in accordance with AS 38.05.035(a)(8)(C), AS 38.05.180(x), 11AAC 82.810, and Section 11.4 of the Kuparuk River Unit Agreement, and other applicable law."

ConocoPhillips officials have been including Coyote, Nuna and Northeast West Sak in a slate of Greater Kuparuk Area projects. The company has said that Coyote and Nuna would be developed from Kuparuk River unit drill sites 3S and 3T. Drill site 3T is the new name for the expanded Nuna pad, which Pioneer built to support its Nuna work back in 2012 and 2013, when the project was still an Oooguruk satellite.

Development plan approval

On Feb. 6 the division approved CPAI's proposed development unit plan of operations for Kuparuk River unit DS-3T, including pad and road expansions.

The work, some of which has already begun, includes expansion of the southeast side of the existing gravel pad, expansion of the existing 2.9 mile access road to the pad and expansion of the access road intersection near DS 3S.

The division said the expansion is to allow transport and installation of the single production module and the larger drilling rig required for directional extended reach drilling of the 29 new wells proposed for the project.

There will also be some 3 miles of new pipelines from DS 3T to DS 3S, with power to be supplied by a messenger cable connected to the new pipeline.

The single production module, or SPM, "is an advanced self-contained unit that consolidated numerous other modules that would traditionally be found on a pad and controls the functionality of the drill site," the division said, with multiple modules in one unit which can be assembled and tested off site.

The access road had to be widened for transportation of the 140-foot by 40-foot SPM, as well as the larger drilling rig required for horizontal/directional drilling.

Work schedule

The existing suspended Nuna wells were plugged and abandoned in December.

Beginning in August, and continuing through May 2024, project work includes gravel mining, gravel pad expansion, access road widening, culvert extensions and intersection expansion.

Pipeline construction and ice pad/road construction is proposed to begin in October and continue through the end of May 2024.

Pipeline crossing (casing installation) is scheduled for October through the end of June 2024.

Construction of drill site facilities will be from January 2024 through the end of March 2025.

Single production module sealift and transport to DS 3T is scheduled for July through the end of September 2024.

Pipeline tie-ins are from July 2024 through the end of September 2024.

Pipeline hydrostatic testing is from July 2024 through the end of September 2024.

Drilling and completion activities are from October 2024 through the end of December 2027.

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