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State approves four PODs for Inlet, Slope
Kristen Nelson Petroleum News
The Alaska Division of Oil and Gas has recently approved four annual plans of development, one for the North Slope and three for Cook Inlet.
Badami On the North Slope, the division approved a POD from Savant Alaska LLC, a Glacier Oil and Gas company, for its Badami unit on the eastern side of the Slope. In its decision the division noted that Savant recently completed the B1-07 well to its Starfish prospect as a Killian Sands well. The company also completed well and facility maintenance to manage natural field production in decline, including replacement of one of its two power generation turbines and maintenance-workover operations on a disposal well, the B1-01.
Through the end of 2017, 8.06 million barrels have been produced from the Badami unit.
Savant has committed to putting the B1-07 well on pilot production prior to the end of the 14th plan period, and pending results, to apply for a new participating area for the Starfish prospect.
Under the new plan, the 15th for Badami, which covers July 16 through July 15, 2019, results of the B1-07 well will be analyzed and future drilling targets developed. If the well results are favorable and economic conditions warrant, the company plans to drill up to two additional wells at Badami during the winter of 2018-19.
This in addition to continuing well and facility maintenance and optimization.
Cannery Loop In Cook Inlet, the division approved Hilcorp Alaska’s 2018 POD for the Cannery Loop unit, the 39th POD for that unit, which was formed in June 1978 and began sustained gas production in April 1986. The CLU is producing from the Beluga undifferentiated sands participating area and the Upper Tyonek formation undifferentiated gas sands PA.
The former Sterling gas sands PA was terminated in 2011 and the PA area contracted from the unit to facilitate the reservoir’s transition to gas storage for Cook Inlet Natural Gas Storage Alaska.
Average gas production in 2017 was 10.1 million cubic feet per day, an increase from 9.36 million in 2016. Cumulative gas production at the end of 2017 was 201.24 billion cubic feet.
Hilcorp has no planned exploration or delineation activities for 2018, it anticipates continued production from existing wells to remain steady during the 2018 POD period.
Deep Creek The division approved Hilcorp’s 2018 POD for the Deep Creek unit, the 15th for that unit, which was formed in 2001. Sustained production from the Happy Valley PA began in late 2004 and the unit was acquired by Hilcorp from Union Oil Company of California on Jan. 1, 2012.
Gas production from the Happy Valley PA and the undefined Sterling formation declined in 2017 with average production of some 5 million cubic feet per day; cumulative production through 2017 was some 34.6 bcf.
Hilcorp drilled two stratigraphic test wells in October out of the four to six it committed to drill. “Based on those results, however, Hilcorp commits to new exploratory drilling plans during the 2018 POD period by drilling at least two and up to four more stratigraphic wells targeting the Sterling and Beluga formations,” the division said, and also plans on exploratory drilling targeting the Sterling and Beluga formations in 2019 based on results of the 2018 stratigraphic wells.
The division said Hilcorp has been granted a series of delays of a mandatory unit contraction, with an extension application due by May 31. Union Oil was told when it submitted its eighth POD in late 2010 that the ninth POD must provide for exploration of the unitized area and drilling necessary to determine areas capable of producing in paying quantities. As early as 2004 the division said in another decision that “Unocal’s initial interpretation indicated that the unit area may encompass several potential hydrocarbon accumulations and exploration to date has confirmed the presence of the Happy Valley reservoir in the northern unit area.” The potential areas were south of the Happy Valley reservoir.
Kenai gas field pool 6 storage The division has also approved a 2018 POD for the Kenai gas field pool 6 storage lease, the 14th POD for the gas storage lease.
Hilcorp has continued to conduct storage operations and optimize gas production wells throughout the field, the division said, with 14 wells on the gas storage lease, 10 gas producers, three gas injectors and a monitoring well.
Storage capacity in the gas storage formation is limited to 50 billion cubic feet at the end of any month. The division said all recoverable native gas in the reservoir, 32.51 bcf as of August 2005, has been produced.
Hilcorp injected 9.2 bcf of gas during 2017 and withdrew 5.072 bcf.
The division said no facility work was conducted in either 2016 or 2017 and none is planned for 2018, with no new wells or major well work planned.
Injection for 2018 is projected to be between 1 bcf and 9 bcf of gas with extraction in periods of high demand. The company has no plans for changes in long-term storage.
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