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Talitha unit formation OK’d; Great Bear plans exploration wells
Kristen Nelson Petroleum News
The Alaska Department of Natural Resources’ Division of Oil and Gas has approved formation of the Talitha unit on the North Slope. Working interest owners are Great Bear Petroleum, the operator, and Borealis Alaska. The 44,463-acre unit is adjacent to the southern border of the recently approved Alkaid unit (see story in Nov. 8 issue of Petroleum News) where Great Bear Petroleum is the working interest owner.
The division said in its Nov. 12 unit approval that the area of the potential hydrocarbon accumulations at Talitha, “although meeting the regulatory requirement for inclusion in a unit, will require extensive drilling, testing, and additional delineation work to determine its commercial viability.”
Due to the lack of exploration within the proposed unit, Great Bear is to post a $3.3 million performance bond by Sept. 15, 2021, and drill one well within the initial two years of the unit, or two wells within the initial four years.
If the bond is not posted by the deadline, the unit “automatically terminates,” the division said. Failure to meet the drilling requirements within the first four years of the unit would result in performance bond forfeiture and automatic unit termination five years from the unit’s effective date of Nov. 12.
Without unit formation, leases totaling 28,682 acres, 65% of the total, would expire April 30, 2021. Another 10,080 acres, 23% of the unit, expires Nov. 30, 2022. The remaining acreage expires Jan. 31, 2025.
Previous exploration The division said while there has been scattered exploration in the Talitha area since the 1960s, the unit area is lightly explored with just a single well, ARCO’s Pipeline State No. 1, drilled in 1988.
Great Bear acquired five new proprietary 3D surveys from 2012 through 2016, covering some 1,000 square miles near the proposed Talitha unit, using “these seismic surveys to map depth of structure, fault patterns, and amplitude anomalies associated with potential reservoirs,” the division said.
Pipeline State 1 targeted the Kingak and Kuparuk formations, with mud logs showing oil and gas shows in the Brookian and Kuparuk, the division said.
Kuparuk potential The Kuparuk C sandstone is one of the major reservoirs on the North Slope, most notably producing from the Kuparuk River unit.
Because of its depositional setting, there are “dramatically variable sand thicknesses and aerial extent of individual sand bodies,” the division said, with Kuparuk C sandstone “distributed irregularly” outside the Kuparuk River unit.
The division said Great Bear integrated available well data with seismic to predict Kuparuk C sandstone within Talitha.
“Siderite cementation and glauconite content are the primary controls on reservoir quality in the KRU, causing great variability in porosity and permeability,” the division said. Where there is little cementation, Kuparuk C can produce at high rates from relatively thin sandstones.
Outside the KRU smaller accumulations of Kuparuk C have been discovered and developed, including at the Oooguruk unit, the Aurora, Borealis and Midnight Sun accumulations in the Prudhoe Bay unit and the Fiord-Kuparuk and Nanuq-Kuparuk participating areas in the Colville River unit.
Kuparuk C is also the main target at Mustang in the Southern Miluveach unit and was the key objective for formation of the Placer unit. The division said Kuparuk C is also prospective at Pikka.
“Within the proposed TAU (Talitha unit), the Pipeline State 1 well encountered the Kuparuk C sandstone,” the division said, with 30 feet of core recovered from the Kuparuk and mud logs recording an oil show in the Kuparuk interval.
“Even given the vagaries of exploring for Kuparuk C sandstone, it is possible Kuparuk oil may eventually be produced within the proposed unit area,” the division said.
Brookian potential The division said the Brookian sequence has drawn much recent North Slope exploration activity, particularly the Nanushuk and Torok.
“The hydrocarbon potential of the Brookian interval across the North Slope Basin cannot be ignored,” the division said, noting the Qannik sandstone, a zone of the Nanushuk group, within the Colville River unit, which is currently being developed. At Pikka, Oil Search Alaska “believes that several Nanushuk sandstones are prospective” and the Nanuq-Nanuq participation area at the CRU and the Torok PA at Oooguruk “represent the only long-term Torok Formation production to date.” The Moraine program at ConocoPhillips Alaska’s Kuparuk River unit “also produces from the Torok Formation, but it is still early in development.”
Great Bear has flow tested the Brookian in the Alkaid well nearby, and given those results and mud logs from the Pipeline State 1 which record hydrocarbon shows in the Brookian interval, “the Brookian section could potentially be productive in the TAU as well,” the division said.
Exploration plan The division has approved the initial unit plan of exploration for Talitha, effective Nov. 12 through Nov. 11, 2022, with a second POE due Aug. 13, 2022.
Great Bear said in the POE that it plans both non-drilling and drilling activities over the next three years.
Non-drilling activities include reprocessing some 50 square miles of merged 2012-16 3D datasets; an expanded review of Campanian reservoir characterization within Talitha; update the gas to oil ratio model for Talitha and develop a gas handling strategy for future development; and engage an outside engineering firm to produce an engineering study on a conceptual “hot tap” of the trans-Alaska oil pipeline within or near the Alkaid and Talitha units, working in consultation with Alyeska Pipeline Service Co.
Drilling activities included in the plan are for two exploration wells, Talitha A and Talitha B, to be drilled as winter ice road and ice pad supported operations.
“They will be vertical wells drilled to the base of the Kuparuk sand,” Great Bear said in the POE. The company said the well locations have “been selected to penetrate an attractive portion of both the Shelf Margin Deltaic play and the Kuparuk play, with an emphasis on the Shelf Margin Deltaic play potential.”
Small laterals may be drilled as well.
Talitha A would be drilled on ADL 391658, with operations scheduled for the winter of 2021, spudding approximately Feb. 1, 2021, “pending fundraising,” using an ice pad some 8 miles west of the Dalton Highway, Great Bear said. A vertical well is planned to a depth of some 10,200 feet.
Talitha B would be on ADL 391972 on the border of ADL 391971, with operations scheduled for the winter of 2022, spudding approximately Feb. 1, 2022, “pending fundraising,” from an ice pad some 7 miles west of the Dalton Highway. A vertical well so a depth of some 9,920 feet is planned.
Great Bear said its work commitment includes a performance bond of $3.3 million posted no later than one year from the effective date of the unit agreement or Sept. 15, 2021, whichever is earlier, with the unit to terminate automatically if the bond is not posted by the deadline.
The other part of the work commitment is drilling, with one well to be drilled within two years, or two wells within four years “to maintain the unit.”
“If one well is not drilled within two years, then the bottom holes of the two wells must be no less than two miles from each other,” and each well must be a new grassroots well, Great Bear said.
If the drilling schedule is not met, the bond will be surrendered in full and the unit terminated five years from the effective date.
“Each well must be drilled and logged to the base of the Kuparuk Formation or its equivalent” as seen in the Pipeline State 1 well, and must be logged with a typical log suite, the company said.
“For any interval where logging suggests the potential for significant oil production, rotary sidewall or full core samples must be acquired and fluid samples acquired in a flow test or by downhole sampling tool at reservoir conditions.”
- KRISTEN NELSON
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