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Cook Inlet’s largest operator looks at more potential with high prices Unocal Alaska Resources sets inlet record for length of horizontal section as it develops smaller, tighter zones Kristen Nelson PNA News Editor
Technology and oil prices are both helping Unocal Alaska Resources produce Cook Inlet’s considerable remaining reserves.
Unocal, the largest operator in Cook Inlet, is building on its international expertise in horizontal drilling to reach untapped oil zones — especially at the McArthur River field (the Trading Bay unit), where more than 600 million barrels have been produced and another 700 million barrels remain.
The easy oil zones have been produced, Martin Morell, Unocal’s Alaska oil and gas operations manager told PNA July 25. What remains is more difficult and more costly to reach — and reaching that oil will depend on the price of oil as much as the company’s expertise, Morell said. Horizontal sections in Cook Inlet On the expertise side, Unocal has been drilling horizontal wells in Cook Inlet since 1992, he said, building on the company’s pioneering work with horizontal drilling in the North Sea in the mid-1980s. Unocal has been pushing that envelope in different parts of the world, Morell said, progressing and polishing the techniques.
The geology of the Cook Inlet fields is pretty well known, he said: “Geology always gets better and better, but there’s not been a major step change the way there has been in drilling and completion” at the company’s Alaska fields. “Our directional control is better than it has been before and our ability to drill through some of the difficult zones in the Cook Inlet is improving a lot.”
The inlet work requires “directional equipment that’s fairly state of the art” and “different mud systems because of the friction, the torque and the drag friction that develop,” he said.
At the McArthur River field — the Trading Bay unit — Morell said, “we’ve been very successful in development in the last two years, mostly in applying horizontal drilling completions. As a matter of fact we’ve just completed a well that was a record setter for the Cook Inlet … with a horizontal section of 3,745 feet.”
This horizontal section was through several coals, targeting areas of the field that haven’t been depleted through conventional development, Morell said: “typically, they’re tighter, lower permeability, or fringe area.” Oil price an important factor “There’s a large amount of oil still to be potentially recovered. There’s something like 700 million barrels of oil still in place in the Trading Bay unit alone. So it’s a matter of being able to put projects together to go after that economically, to be able to commercialize it. So it’s not a lack of resource, it’s the ability to make projects commercial,” he said.
“There are 15 different oil reservoirs or oil zones, benches we call them. And the most prolific ones have been swept, have been flooded, water flooded.
“But it’s the tighter zones and the areas of the field furthest off the fringes and the flanks, the nooks and crannies, if you will.” To reach remaining oil in Cook Inlet, Morell said, the company is “going out farther, or opening longer completion sections tot he well bore” and drilling more challenging directional wells.
“It’s places like the Cook Inlet, that have a lot of oil in place, that in recent years have been marginal, could really thrive in a high oil price environment,” Morell said. That 700 million barrels remaining, he said, is in one field: “And then the further exploration potential and development potential in the area. It could be a real revitalization if the oil price were to firm up. That’s exactly the kind of place that would be focused on domestically — it’s a significant resource. Infrastructure’s in place.”
Morell said the lack of a jack-up rig for Cook Inlet has been a real handicap for exploration. Anything Unocal can reach from existing platforms, or from shore, could be drilled with available rigs, but not other offshore prospects.
“Forcenergy’s approach, you know, was to put a very small, a relatively small platform, fixed structure, in place for that. We’re very curious, we’re very anxious to see how well that works out. We have other similar ideas and will be very interested to see how that approach works for them,” he said. Good price, good development results At the beginning of the year, Morell said, Unocal Alaska drilled its best well in 17 years — with initial production of 2,000 barrels a day and still producing at 1,500 barrels a day, Unocal’s best current producer in Alaska.
“The combination of development results and high oil prices is something that bodes very well for us here,” he said.
It’s very different than it was a couple of years ago, when “there was a fair amount of uncertainty” as Unocal looked at either restructuring or divesting its Cook Inlet properties. “So there has been a resurgence since then in development activity and a lot of success.”
Unocal did sell its Nikiski fertilizer business, but kept the Cook Inlet oil and gas asset. One rig working offshore, one onshore Morell said Unocal typically has one rig working onshore and one offshore. Most of the 10 Unocal-operated platforms have rigs on them, and the company will try do several projects on a single platform because its more efficient that mobilizing and demobilizing, starting and stopping, different rigs.
This year Unocal started on the Steelhead platform, worked on the Dolly Varden and is currently working on the Grayling. “We’ll be back on Steelhead and depending on what time of year that is we may get to King Salmon platform either late this year or early next year.
“And typically there’s three or four projects undertaken on a platform.”
The projects include workovers of existing wells and drilling new wells.
“Probably roughly equal numbers. Most of our drilling projects are reentry and sidetrack, redrills. We’re running low on well slots,” Morell said. Well slots are run through the support legs of the Cook Inlet platforms, “so when you run out of room in a let there’s no way to add to it.”
When a well begins to produce a very high proportion of water to oil, it becomes a candidate for a redrill — the well bore will be used and a well drilled to a new bottom hole location.
Morell said it seems there’s “an endless list of places to put wells. At today’s oil price the potential for activity in the inlet is very strong. Two years ago it was a much different picture.”
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