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Pioneer submits Oooguruk development apps Project hasn’t yet been sanctioned, but in late July applications were delivered to agencies; first production could be in 2007 Kristen Nelson Petroleum News Editor-in-Chief
Pioneer Natural Resources and partner Armstrong haven’t sanctioned development of their Oooguruk discovery offshore Alaska’s North Slope, but they have submitted permit applications to state and federal agencies.
“I don’t think we’d be filing permits if we weren’t serious about the project,” Scott Sheffield, the company’s chairman and chief executive officer, told analysts in a conference call Aug. 2. Asked if the company might be making acquisitions in the Gulf of Mexico he said , “… longer term our primary focus we think … a lot of the activity will be more focused on West Africa and also the North Slope.” And in discussing planning for a 2006 budget he said the company expects capital spending to be about the same as in 2006, with some decrease in land and seismic, “and then we’ll be adding … Oooguruk and our South Coast gas projects to make up the difference.”
Paperwork filed with agencies in Anchorage in late July indicates that a unit expansion is in progress, and filings with the state by Anadarko Petroleum for lease ADL 379301, on which the Thetis Island exploration well was drilled by Exxon in the early 1990s, say Anadarko is farming out “its Oooguruk leases (including ADL 379301)” to Pioneer Natural Resources (70 percent) and Armstrong Alaska (30 percent) for inclusion in the Oooguruk unit. In addition to the Thetis Island lease, which juts into the Oooguruk unit on the east, Anadarko also holds leases adjacent to Oooguruk on the west. Offshore drill site The company’s applications indicate that Oooguruk, where Pioneer and Armstrong discovered oil in 2003, will be developed from a six-acre offshore production drill site, with flow lines bringing production into Kuparuk River unit facilities, with a production tie-in pad northwest and immediately adjacent to facilities at Kuparuk River drill site 3H. The offshore drill site will be in four to six feet of water approximately 2.5 miles north of the mouth of the Colville River Delta, 2.1 miles northwest of Kuparuk and 8.9 miles west of Oliktok Point. The subsea flow line will be buried in a trench and will carry produced fluids 5.7 miles from the offshore drill site to shore, then transition to aboveground flow lines on vertical support members for 2.4 miles and a tie-in at DS-3H.
Pioneer told agencies the targeted oil production zone is the Nuiqsut and Kuparuk reservoirs of the Kingak formation of the Beaufortian sequence. “Reservoirs within the Beaufortian sequences are younger, thinner, and typically laterally discontinuous as compared to the reservoir” at Prudhoe, the company said. Peak oil production is estimated to be some 18,000 to 20,000 barrels of oil per day.
Facilities at the offshore drill site would include: development drilling rig and support packages, wellhead modules and truckable production modules. Space for 48 wells Pioneer said there will be 48 wells on the drill site with the option to increase to 60; about half the wells will be producers and half injectors, with one Class I/II underground injection control disposal well.
Following the drilling phase a permanent camp facility will be installed on the offshore drill site with a capacity of approximately 15 workers doing facility maintenance and workover supervision during the production phase of the project.
During construction, a camp onshore will accommodate 200 to 250.
There will be a helipad at the island, and helicopters will be used for personnel and equipment transport during unstable ice periods in the spring and fall. A marine dock will support summer marine resupply operations and marine crew change options. The dock will be 150 feet long to accommodate unloading 200-foot barges.
Electrical power will be purchased from ConocoPhillips Alaska’s existing facilities, Pioneer said, or generated at the DS-3H pad, if the existing facilities cannot meet Oooguruk power demands. Mine site activities late this year Conceptual engineering and design for Oooguruk development began in the fourth quarter of 2004, and permit review and approval is scheduled for the third and fourth quarters of 2005. Mine site activities will begin in late 2005. Pioneer and Kerr-McGee are coordinating an expansion of Mine Site E as a gravel source as new joint operators. Some 500,000 cubic yards of gravel is the expected requirement for Oooguruk.
Ice road construction would begin in the first quarter of 2006, followed by production drill site construction. Flow line construction would follow in the first quarter of 2007, with rig mobilization and facilities construction in the second quarter of 2007 and development drilling beginning in the second quarter of 2007 and continuing through the second quarter of 2010.
First production is expected in the fourth quarter of 2007.
Winter access to the offshore drill site will be by ice road from DS-3H with conventional vehicles or possibly rolligon. Summer transportation would be by landing craft, hovercraft or shallow-draft crew boats, with marine barging possible for resupply during open-water seasons.
Produced fluids will be transported to DS-3H in a flow line inside a conductor pipe — a pipe-in-pipe design, with a water injection line, arctic heating fuel line and gas injection line bundled to the conductor pipe with spacers and straps. Burial depth will depend on required protection from strudel scour, ice gouging, permafrost thaw settlement, channel seabed erosion and upheaval buckling. Pioneer said its preliminary assessment is that four feet to six feet burial depth would be adequate for mechanical protection.
The company plans two test trenches during the 2006 winter season. Some development drilling seasonal Pioneer said the majority of Nuiqsut formation wells would be drilled year-round as they would have “little, if any, capability to flow without stimulation and/or artificial lift mechanisms.” With electrical submersible pumps these wells are expected to have a production rate of 1,000 bpd.
Since Kuparuk formation wells may flow unassisted at rates of 1,500 to 2,500 bpd, “Kuparuk wells would be subject to seasonal drilling restrictions below threshold depths,” the company said.
The production life of the drill site is estimated at 20 to 30 years.
Ice roads will be built for winter construction in 2005-06, 2006-07, and for development drilling through 2009-10. A parallel ice road will be built for flow line construction in 2006-07.
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