Westward expansion proves challenging

Kristen Nelson

There are costs and challenges associated with expanding westward from existing North Slope oil and gas development, says Kris Fuhr, manager of Phillips Alaska Inc.’s project group.

There are “some significant technical challenges… to figure out ways to address all the environmental concerns including minimize footprints, including minimize impact to our neighbors out there” because development is now “in the neighborhood of Native surface owners,” he said Feb. 20 at the Pacific Rim Construction, Oil and Mining Expo. And satellite operations away from infrastructure, “are not cheap developments.” Taking western North Slope discoveries to commercial projects presents challenges, “and we saw this at Alpine, where you don’t have roads,” Fuhr said.

Alpine development “validated that … there are some costs associated with not having the logistics and the infrastructure that Prudhoe or Kuparuk does — and we’re finding out now what those real costs are.”

Even with Kuparuk satellites “the challenge is to try to develop these small satellite resources 15-20 miles away from the anchor fields,” he said.

“There are some costs associated with not having the logistics and the infrastructure that Prudhoe or Kuparuk does and we’re finding out now what those real costs are. And we will apply that on a going-forward basis to help us decision or make the right decisions commercially,” Fuhr said.

Part of that cost is the addition of ice roads to project costs and part of it is the planning. If you want to work around a pad outside of the winter season, he said, “you need to have the foresight to have that material on the pad before your ice road melted” or else you’re going to have to fly material in, “and depending on how big the materials is, some of these flights you’re looking at $200,000-$300,000.”