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Providing coverage of Alaska and northern Canada's oil and gas industry
August 2019

Vol. 24, No.34 Week of August 25, 2019

Pikka moving closer

Oil Search files development plan for the Pikka portion of giant Nanushuk Project

Kay Cashman

Petroleum News

Oil Search Ltd. has taken one more step toward production of its big Nanushuk oil discovery, scheduling its 120,000 barrel per day development for April 2023.

On July 15, Oil Search (Alaska) LLC submitted a plan of operations application to the Alaska Department of Natural Resources’ Division of Oil and Gas to authorize the development phase of a portion of its Nanushuk Project within the Pikka unit. The Nanushuk oil reservoir west of the central North Slope is thought to rival that of multibillion-barrel Kuparuk River unit, the second largest oil field on Alaska’s North Slope.

In turn, on Aug. 19, the division posted a 30-day notice asking for public comments on the proposed Nanushuk Project’s Pikka development, which includes some infrastructure on leases outside the unit (see project overview map in pdf of this story).

In its plan, Oil Search said it intends to continue to operate Pikka, including the completed production facility and related infrastructure.

The company had previously said discussions for possible facilities sharing on the 120,000 barrel per day development were taking place with “current North Slope operators.” Negotiations were to be completed by the time a Pikka FEED, or front-end engineering and design, decision was made in the second half of this year. The timing has since been narrowed down to the fourth quarter (see article in this issue titled “Oil Search, Conoco team up in Alaska.”)

In addition to oil from the prolific Nanushuk formation, the Pikka development will target the Alpine C interval, another one of six stacked plays in the unit, per a 2016 statement by former operator head Bill Armstrong.

Three drill sites, 151 wells

The leases involved in the actual production of oil are held by Oil Search. All are state of Alaska leases, although in most cases the subsurface mineral estate is jointly managed by the state and Arctic Slope Regional Corp., the Native regional corporation for the area, with the surface land owned by Kuukpik Corp., the Native village corporation for the community of Nuiqsut.

Per the Pikka development plan, which was submitted by Oil Search’s permitting manager Julie Lina, the company has, or anticipates having, an access agreement in place.

The Pikka development will have three Nanushuk Project drill sites, A, B and C, with as many as 151 production and injection wells - 43 at ND A, 55 at ND B, and 53 at ND C (see chart titled Pikka Schedule of Operations in the pdf of this story).

Other significant infrastructure will include the Nanushuk processing facility, the Nanushuk operations pad, tie-in pad, infield pipelines, import and export pipelines, infield and access roads, a boat ramp and a potable water system. The Oliktok Dock will be used for offloading barges transporting sealift modules to the project.

But prior to these activities, screeding will be done in front of the existing Oliktok Dock.

Oil Search’s plan also said minor upgrades and maintenance to the existing road system may be required to facilitate transportation of sealift modules.

Gravel for project development will be from one or more existing gravel mine sites, which will be permitted and operated independently of the project.

Permanent and temporary structures

The Pikka development will include both permanent and temporary buildings.

The Nanushuk operations pad will support fieldwide operations and will have the following: a 200-bed operations camp; office, warehouse and maintenance buildings; warm and cold storage buildings; water/wastewater treatment plants; communications structures; backup generators and fuel storage; and a helicopter landing pad.

The Nanushuk processing facility will include processing and utilities modules; metering and pigging facilities; power generation facilities; a truck fill station; construction material and equipment staging areas; and a central control room. The processing facility will have either a single flare or dual flares to support both high and low pressure safety relief systems.

A number of additional temporary camps will be established to support construction and drilling activities

Offsite pioneer construction camps will be near the selected mine site on an ice pad or on an existing gravel pad, pending available space, Oil Search said in its plan. These camps will be used until the construction camps are installed and operational (up to two years) and house as many as 300 people each.

Construction camps capable of housing a total of 800 people will be on one or more of the project’s gravel pads. The camps will remain through the completion of the construction and startup phase (two to five years), after which they will be decommissioned and removed from the site.

Drilling support camps will be on each drill site. They will house 120 to 150 people per rig and be used for up to 19 years before being decommissioned and removed.

The design life of the Pikka project is “30 years or more,” Oil Search said.

Well sites

The locations of the three drill sites were dictated by the configuration of the oil reservoirs and defined by previous exploration efforts, with consideration for site accessibility requirements and operational constraints. Drill sites are also oriented with the long axis parallel to the prevailing northeast/southwest wind direction to minimize snow drifting, Oil Search said

The drill sites might have additional well slots to accommodate two Class 1 underground injection control disposal wells.

Grind and inject facilities will be built on ND B.

In addition to accommodating drilling equipment and support facilities, the drill sites will have space for well testing equipment, stimulation equipment, drilling mud and cement tanks, production gathering facilities, diesel fuel storage tanks, a communication tower, cold storage, emergency response equipment, process heaters, drilling laydown areas, temporary camps and offices.

No processing of multiphase product - a mixture of crude oil, natural gas and produced water - beyond routine well testing and process fluid heating, will occur at the drill sites.

Nanushuk processing facility

Multiphase product from the drill sites will be transported to the Nanushuk processing facility via multiphase pipelines.

Seawater and produced water separated from the oil at the processing facility will be treated and transported back to the drill sites via water injection pipelines to be reinjected into the subsurface formation to help with crude oil production.

Separated gas will be used for fuel at the facility, and the remainder will be transported back to the drill sites via pipelines for gas lift. Excess gas, if any, will be injected into dedicated injection wells at the drill sites.

Sales quality oil will be transported to the tie-in pad near the Kuparuk central processing facility 2 via the Nanushuk Pipeline, where it will tie into the Kuparuk sales pipeline for conveyance to the Trans Alaska Pipeline.

Equipment designed for fluid separation (gas, oil, water), heating and cooling, pumping, gas treatment and compression for gas lift and injection, and water treatment for injection will all be at the Nanushuk processing facility.

The processing facility will also include metering and pigging facilities; power generation facilities; a truck fill station; construction material and equipment staging areas; a central control room; an equipment receiving module; and a communication tower.

The facility will house a tank farm for diesel, crude oil, production chemicals, glycol, and methanol storage tanks.

All facilities will be fabricated off site and delivered to the project overland by truck or by barge during the summer. Modules delivered by barge will be offloaded at Oliktok Dock and moved to the site: “The project also includes delivery of large modules by barge to Oliktok Point during open water and transport using self-propelled module transporters over the existing and new road system. Minor upgrades and maintenance to the existing road system to facilitate transportation of sealift modules will occur if engineering and construction design determine it is required,” Oil Search said.

Nanushuk operations pad

The Nanushuk operations pad infrastructure includes:

* A 200-bed operations camp to house operations and maintenance personnel, including living quarters, housekeeping, a recreation area, food service facilities and a small medical clinic.

* Office, warehouse, and maintenance buildings.

* Warm and cold storage buildings.

* Water/wastewater treatment plants and temporary waste storage areas.

* Communication structures, including a tower.

* Diesel-fired standby power generators and fuel storage.

* A helicopter landing pad, although Oil Search said routine helicopter use is not planned under normal operating conditions.

* A tank farm for diesel and refined fuel.

The operations pad will also support construction camps, offices, laydown, storage and maintenance facilities during the construction phase. Once removed, the area will be repurposed for drilling and operations.

Utilities

Power generation facilities at the Nanushuk processing facility, will consist of gas-powered turbines. Power will be supplied to other project facilities, including drilling rigs, if power availability allows, via power cables installed on infield and Nanushuk Pipeline horizontal support members, or HSMs, using messenger cables.

Power generated at the processing facility will be supplied to each drill site through 34.5 kV power cables. A 13.8 kV cable will run from the facility to supply power at the Nanushuk operations pad and the tie-in pad.

When power from the processing facility is not available, diesel-fired engines used to power the drilling rigs will comply with EPA Tier 4 final emission standards, Oil Search said.

Communications between project facilities will be via fiber optic cables installed on infield and Nanushuk Pipeline HSMs using messenger cables.

Communication towers will be at the drill sites, the processing facility, the operations pad, and the tie-in pad. The towers will be approximately 30 feet at the drill sites and 120 feet at the processing facility and operations pad.

Gravel roads

The Pikka development plan includes 12.4 miles of gravel infield roads - a 3.5 mile ND A road, a 2.1 mile ND B road, a 5.2 mile ND C road, a 1.4 mile Nanushuk boat ramp access road and a 0.2 mile water source access road - to provide all-season ground transport between the processing facility, drill sites, and other project facilities. The project also calls for a 9.5 mile gravel Nanushuk access road to provide all-season transport connecting the processing facility to other infrastructure.

Gravel roads will be built to be 24 feet (up to 44 feet at the base) to 32 feet (up to 52 feet at the base) wide at the surface, although roads could be wider at curves for larger modules, resulting in widths within a range based on North Slope industry construction and safety practices.

Six road turnouts (three along the Nanushuk access road, one along the ND A road, one on the ND B road and one on the ND C road) will be constructed to allow safe access to project facilities during movement of large equipment such as drilling rigs.

Three gravel tundra access ramps will be placed at road turnouts near the drill sites to provide access for off-road travelers.

Snow ramps will initially be built for “tundra access and the gravel tundra access ramps will be sited and constructed based on areas of highest use by local subsistence users,” Oil Search said.

Access and infield roads are designed to accommodate two-way traffic for use during “facility construction; drilling; and operations for mobilization of construction materials, drill rigs and drilling materials, supplies, personnel, and, if necessary, emergency spill response equipment.”

The Nanushuk access road will follow the existing Mustang access road for 4.7 miles, although the exact length could vary slightly due to wider curves and other topographical features, Oil Search said.

Use of the Mustang access road will need upgrades to bring it up to minimum design standards and improve road surface condition, possibly involving expansion of the road base width and the addition of higher quality material to improve load capacity.

Gravel roads will parallel the proposed pipelines to facilitate year-round access for maintenance, repair, monitoring, and, if necessary, emergency response.

Bridges and culverts

The Nanushuk access road will cross the Miluveach River and the ND C infield road will cross the Kachemach River on 170 and 245 foot bridges, respectively. Both bridges will be multi span structures and will include pipe pile foundations at sheet pile abutments and several sets of intermediate pier piles between abutments, Oil Search said.

The bridges will consist of steel girders with precast concrete decks.

At the Kachemach River crossing, the bridge is designed to accommodate boat traffic.

The access road will include drainage structures to pass the expected flow along the road. Prior to construction, an engineer will walk and slope-stake the roads to determine precise locations of drainage structures and determine on-site conditions for final layout.

Typical drainage culverts will be structural steel pipe

Fish passage culverts will be designed at stream crossings where the Alaska Department of Fish and Game determines that fish are present, and design will be in accordance with the department’s Title 16 fish passage standards.

Flow velocities at culvert outlets will be analyzed, and outlet erosion control measures will be designed as necessary to prevent channel degradation.

Downstream scour protection, where required, generally consists of articulated concrete block mats or other appropriate material in Oil Search’s plan.

Typically, steel pipe culverts will be built during winter.

Multiplate culverts will be installed during the summer months to allow proper compaction of gravel around the culverts; however, temporary passage structures can be installed during winter, Oil Search said, allowing continued flow during construction of the permanent multi-plate structure.

Cross-drainage culverts will be installed within the infield and access roads to reduce impoundment and allow conveyance of surface water flow that intersects the road in order to maintain natural drainage patterns.

Ice roads and pads

Ice roads will be used during construction of the pipelines, gravel roads and bridges.

Approximately 190 to 280 miles of ice roads are planned during the construction phase.

Standard duty ice roads on the North Slope are a minimum of 6 inches thick and an average of 12 inches thick due to terrain features, Oil Search said.

Ice roads for construction, materials and personnel transportation will be built to support expected loads and protect the vegetation and organic soil beneath.

The roads will be wide enough to safely accommodate two-way vehicular traffic (minimum of 20 feet), drill rigs (minimum of 35 feet) and other traffic, as required.

The ice road season each year varies depending on weather conditions and ice road completion times.

Seasonal ice pads will be used to support construction activities, including gravel placement, and pipeline and bridge installation. Ice pads will likely be adjacent to bridges, at each major gravel pad, and every 3 to 4 miles along access/infield roads and Nanushuk/infield pipelines.

Construction support ice pads will house field offices, break shacks, enviro-vacs and field shops, and will stage construction equipment, vehicles, materials and supplies until gravel pads become available.

Each construction support ice pad will be a minimum of 6 inches thick and one acre or less in size. If space on an existing gravel pad is not available, an ice pad may be used to house the offsite pioneer construction camp during winter seasons of construction. Water for ice roads and ice pads will be obtained from permitted surface water sources.

Pipelines

The Pikka development includes two types of pipelines: infield pipelines, which connect the drill sites to the processing facility, and the Nanushuk Pipeline that connects the processing facility to existing infrastructure on the North Slope via the tie-in pad.

All pipelines will rest on HSMs supported by one or two (such as at anchor supports) 8 to 24 inch-diameter pipe pile VSMs spaced approximately 55 to 60 feet.

Pipelines diameters will vary from as small as 6-inch for gas lift and gas injection lines and 24-inch for multiphase lines.

Where feasible, pipelines will be parallel to gravel roads at a distance of between 500 and 1,000 feet to minimize caribou disturbance and excessive snow drift.

All pipelines will be externally coated with 20 mils of fusion-bonded epoxy, covered with 3 inches of polyurethane foam insulation, and wrapped in a 24-gauge sheet-metal jacket. Pipelines will have a non-reflective finish to reduce reflectivity and potential impacts to wildlife.

Where pipelines cross road embankments, coated and insulated pipelines will be encased in structural steel pipe casings buried in the roadway. Casings for pipeline road crossings will extend at least 2 feet beyond the road embankment toe.

Power and fiber optic cables will cross under the road prism via a trench located parallel to each pipeline-road crossing.

Trenching will take place during the winter. Trenched materials will be temporarily sidecast onto an ice pad adjacent to the trench. Trenched materials will be taken off the ice pad and backfilled into the excavation once trenching is complete.

All other facilities, equipment

No new airstrip is proposed for Pikka. During construction, drilling and operations the commercial airport in Deadhorse, approximately 52 miles away, will support air transport of project personnel and small materials and supplies to the North Slope.

Personnel and materials flown into Deadhorse will be driven to the project area via the existing road system and ice roads until the gravel access road is completed.

The tie-in pad will include a pig launcher and receiver, a metering skid, transformer skid, a pipe rack, pumping infrastructure, a shutdown valve, a laydown area, a communications tower and the remote electrical and instrumentation module.

A boat ramp will be constructed in the vicinity of ND B. Located on the lower Kachemach River, the ramp was requested by the community of Nuiqsut in 2014.

The boat ramp’s slope could be as much as 15% and will integrate erosion protection such as armor rock and/or concrete erosion protection mats to stabilize the side slopes.

The ramp will be 20 feet wide at surface and include a small staging and turnaround area with enough space for short term parking of vehicles with trailers.

The ramp will also include an access road (a minimum of 24 feet wide at the surface) to provide access from the ND B infield road.

An alternative boat ramp location was identified by Nuiqsut whaling captains and search and rescue in 2019, Oil Search said.

Leases involved

The project components and their affected leases are as follows:

Nanushuk processing facility, ADL 392983, 392964;

Nanushuk drill site A, ADL 393012;

Nanushuk drill site B, ADL 392984;

Nanushuk drill site C, ADL 393029,392989;

Nanushuk operations center, ADL 392964;

Tie-in pad, ADL 25654;

Pump house pad, ADL 392964;

Nanushuk boat ramp, ADL 391445;

Nanushuk access road, ADL 390680, 390681, 392964, 390692, 390691;

Mustang road upgrades, ADL 390680, 25590, 25585, 25586;

Infield roads, ADL 391022, 393029, 392982, 392984, 391445, 392985, 392986, 392983, 392964, 392987, 392966, 392967, 392988, 392989, 393012, 393013, 393014;

Miluveach River bridge, ADL 390692, 390691;

Kachemach River bridge, ADL 392966, 392967

Nanushuk Pipeline, ADL 390680, 25590, 392964, 390692, 390691, 25570, 25587, 25586, 25585, 25654, 25655, 25657, 25656;

Infield pipelines, ADL 392962, 392982, 392963, 392984, 392986, 392983, 392964, 392987, 392966, 392967, 392988, 392989 391553, 393012, 393014;

Potable water system, ADL 392964;

Oliktok Dock barge offload area, ADL 355024.

Comment deadline Sept. 20

On Aug. 19 the division also posted two other notices, these for private easements Oil Search had requested.

One was for the Nanushuk processing facility and the Nanushuk operations pad, requesting authorization to construct and operate both on state land outside the Pikka unit.

The other was for the Nanushuk access road, again on state land outside the Pikka unit.

Comments to the division, which must be written, on the Pikka development and the two easements are due by 4:30 p.m., Alaska Standard Time, on Sept. 20.






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