Close spacing approved for shale gas well north of Red Dog mine

The Alaska Oil and Gas Conservation Commission has approved a spacing exception for an exploratory gas well, NB 2, a mile and a half north of the Red Dog Mine.

Mine operator Teck Cominco would like to use natural gas to replace diesel at Red Dog and began gas exploration in conjunction with mineral exploration in the late 1990s. The resource in the Red Dog area is shale gas in the Kuna formation.

The commission said Dec. 12 that NB 2 “is a non-conventional gas exploration well” on NANA Regional Corp. land; Teck Cominco is the owner and operator of the leases. The area has been extensively drilled for mineral exploration and the proposed location of NB 2, in section 17, township 31 north, range 18 west, Kateel River Meridian, “is favorably positioned on the underlying geologic structure,” the commission said.

It also said the well is part of a multi-well program to test whether gas can be produced in commercial quantities from a non-conventional shale reservoir. “Production of gas from shale reservoirs requires de-watering to reduce pressure and increase gas flow,” the commission said, and wells in shale reservoirs typically need to be more closely spaced than in conventional gas reservoirs.

The commission said the productivity of this shale is unknown, but de-watering this section of the reservoir and testing gas production will require NB 2 to be closer than 3,000 feet (the standard distance required between natural gas wells) from NB 1.

—Petroleum News