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Revisiting ANWR debate
Big structures in eastern deformed 1002 area continue to raise questions, interest Kay Cashman Petroleum News
Although only those oil companies that co-own 2D seismic data of the ANWR 1002 area shot in the mid-1980s will have subsurface data prior to a lease sale later this year, there is other valuable geologic information coming from Interior’s U.S. Geological Survey that will help bidders understand the oil potential of the region. (The lucky consortium of companies that have access to the vintage 2D data include Anadarko, BP, Chevron, ConocoPhillips, ExxonMobil, Hess, Marathon, Murphy, Oxy, Shell and Total.)
The effort to provide bidders with more info on the 1002 area is led by USGS senior research geologist Dave Houseknecht, a long-time expert on northern Alaska petroleum geology, who talked to Petroleum News July 10 (see July 14 story in PN) and then again on July 12, which yielded the information for this sequence of articles.
In conjunction with field work over the last two summers in and near the 1002 area, the agency has completed a grounds-up reprocessing of 1,451-line miles of the 2D seismic collected from the area in 1984 and 1985, the purpose of which was to tease out more detail than was initially apparent.
Houseknecht had hoped the reprocessed data would be available to consortium companies, but the U.S. Department of Interior’s Office of the Solicitor ruled against releasing it.
Nonetheless, with the aim of reducing geological uncertainties the reprocessed 2D data gave Houseknecht’s team a better understanding of the area: “We are not permitted to show or publish images of the reprocessed ANWR data, so our public presentations use analogs from offshore and state lands west of the Canning River. In both areas, we are permitted to show images of seismic data that we have licensed from certain seismic companies,” he said.
Houseknecht presentations Houseknecht has already released some of his team’s updated 1002 area information, starting with the Arctic Technology Conference in October in Houston.
He has been using the title “Current and future exploration frontiers in Arctic Alaska,” covering his perspective of the entire region, divided into six areas, one of which is the ANWR 1002 area and the adjacent offshore.
He next spoke at the Arctic Oil and Gas Symposium in Calgary, using the same title and format, but adding even more new information.
Both Houseknecht and Kate Whidden presented at the AAPG Annual meeting in San Antonio in May: “Dave Houseknecht: Geological and petroleum systems framework of the ANWR coastal plain,” a talk, and the other a poster, which he said came from “Whidden and others,” titled, “Stratigraphy and facies of the Hue Shale in northern Alaska: Evidence for a viable continuous resource play in an emerging basin.”
Although the poster title does not specify the ANWR 1002 area, it will include it and state lands.
How soon will all the new information be released?
“My slides and Kate Whidden’s poster must go through USGS internal peer review before we can release them, even on the AAPG Search and Discovery site. Our field season (which just started on the North Slope) is delaying that process, but we hope to complete the process by end of summer,” Houseknecht said.
Big structures to east “Before we did our 1999 reassessment there was a lot of consensus that big reservoir potential was in the eastern part of the 1002 area. The big structures that everyone always coveted are there,” Houseknecht said July 12.
Not having access to information from the only well drilled in the 1002 area, the KIC No. 1 in the deformed, or structural, area, the USGS’s 1999 reassessment allocated more oil to the undeformed, or stratigraphic, section to the west - specifically to the younger Brookian reservoirs versus the deeper Ellesmerian reservoirs in structural traps on the eastern side.
USGS’s evaluation increased the mean (50% probability) estimate of in-place total 1002 reserves from the 13.8 billion in its 1987 assessment to 20.7 billion barrels of oil in 1999. And even though the agency used a conservative oil recovery rate, which was (at the time) approximately 33% lower than that at Prudhoe Bay, and assumed it would take a 512 million barrel field to be commercial, the 1999 recoverable oil estimates were still impressive, set between 5.7 billion and 16 billion barrels, with a mean value of 10.4 billion barrels.
The increased numbers for the western part of the 1002 area, which came in part as a result of several new discoveries on the North Slope since 1987, were not disputed by industry or the state of Alaska.
Eastern decrease disputed But the 1999 reassessment’s reduction of recoverable reserves for the eastern part of the area was questioned.
Even though they were forbidden by a Supreme Court order from directly talking about it publicly, the organizations that questioned the 1999 assessment were the agencies and companies who had access to the most important geological data from the ANWR 1002 area - the results of the KIC No. 1 well.
In the eastern deformed area north and a little west of the Niguanak High, a geologic structure that the 1987 assessment credited with something like 75% of the 1002 area’s estimated reserves, was drilled to a depth of 15,193 feet at a cost of more than $40 million. Drilled over two seasons by operator Chevron and BP, the 50/50 partners leased 92,000 acres of Native land within the 1002 area. (The Native regional corporation for northern Alaska, Arctic Slope Regional Corp., owns the subsurface oil and gas mineral rights and the village corporation in the area, Kaktovik Inupiat Corp., owns the surface, hence the well name KIC.)
Chevron, BP and ASRC unsuccessfully sued the state in 1988 to keep the KIC well results completely confidential, claiming among other things that “three-fourths of the land located within three miles” of the well was unleased.
The court ruled that a limited release of the information was permissible, so in addition to BP, Chevron and ASRC, a handful of state of Alaska geoscientists have also been able to see KIC well data.
The strongest public statement came in a carefully worded statement from then-BP spokesman Paul Laird to Petroleum News following release of the 1999 reassessment. He said USGS “did not have sufficient data to substantiate the conclusion, or to justify the conclusion, that most of the potential is in the western 1002 area” and he re-stated BP’s “belief in the prospectivity of the eastern 1002 area, as well as our belief in the western 1002 area.”
Neil Ritson, then-exploration vice president for BP in Alaska, was quoted in the same time period in a press release about BP and Chevron’s renewal of the 92,000-acre Native lease as saying, “ANWR offers the greatest potential for a world-class oil discovery on the North Slope.”
Quoted in the same press release Dave Birsa, Chevron exploration manager for Alaska, said what state geoscientists have continued to echo: “The ANWR coastal plain … is on trend with the prolific oil fields of the central North Slope and has significant geological potential.”
Myers favored test well near KIC In 2003, when Mark Myers, then the director of the division and privy to the KIC well results, put together a plan for drilling a stratigraphic test well on state lands offshore the 1002 area, his preferred location for a test well was in the eastern deformed area, southeast of the KIC well and just north of the Niguanak High.
Common in frontier areas, a strat well was designed to provide geologic data about an area, such as defining the nature of petroleum systems, identifying source rock potential and assessing reservoir quality, etc. In this case the well would have been funded by an industry consortium, although for several reasons it never became a reality.
In the 1999 assessment Houseknecht said USGS recognized the big structures in the east but assigned a “large uncertainty” there, “so even though the mean value was relatively low, there is good upside potential.”
He said at the time (and partly repeated in the July 12 interview), “it’s important to distinguish between the results of our assessment and what may or may not happen at a lease sale. … The oil industry has demonstrated worldwide time and time again that it will assume a lot of risk in testing big structures - like those in the eastern 1002 area. And, those structures are so large that they are well defined, even with the relatively poor quality two-dimensional seismic data that exists in the 1002 area.”
“The regional truncation of the older and older rocks going north is what the concern is in ANWR,” Houseknecht said in his latest PN interview.
Prudhoe Bay-type reservoirs? The open file report done by USGS’ ANWR team in 1999 (98-34) is still basically representative of what is publicly known to those who do not have access to the vintage 2D seismic or the drilling results from the KIC well, Houseknecht said. Information on the bedrock geology of the area comes mainly from surface exposures in the mountains immediately south of the 1002 area and from wells to the west and offshore.
The area to the south and east of the Marsh Creek anticline is part of the Brooks Range thrust and fold belt. In this part of the 1002 area deformation occurred episodically throughout the Cenozoic time
The answer to the question of whether the Shublik source rock and Ellesmerian strata (including the Ivishak) with Prudhoe Bay-type reservoirs are present in the eastern part of the 1002 area - and specifically in the area’s two large structures (the Niguanak High and the Aurora Dome) - is important to the region’s oil and gas potential, per the open file report and PN’s July 12 interview with Houseknecht.
It’s mainly the presence of the Beaufortian rocks (Kingak shale) on the surface in the Niguanak area and in the lowermost 1,200 feet of the offshore Aurora well that offers the possibility of a big oil discovery.
The KIC well and the Aurora well are drilled on the same big structure; the adjacent map also shows the general location of the other big structure, which is at a higher elevation and to the south and east in the Native land.
“In many ways the two structures are look-alikes,” Houseknecht said. “They look like they formed in the same way and have very similar characteristics.”
There are a few blocks on either side of the higher structure to the south outside the Native-owned land (see adjacent map) that will likely be offered in the upcoming Interior lease sale.
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