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Unocal, Marathon announce gas discovery at Ninilchik
Unocal thinks ‘unrisked resource potential’ at Ninilchik and additional prospects total 100-600 bcf, enough to justify Kenai-Kachemak pipeline Kristen Nelson PNA Editor-in-Chief
Marathon Oil. Co. and Unocal Alaska said Jan. 22 that a new natural gas reservoir has been discovered on Alaska’s Kenai Peninsula.
Unocal said the Grassim Oskolkoff No. 1 well, 35 miles south of Kenai, is the first exploration well drilled under a joint operating agreement between the companies in the 25,000 acre Ninilchik exploration unit. Marathon is the operator is the operator and has a 60 percent working interest; Unocal holds the remaining 40 percent.
Marathon said it currently estimates 60 billion cubic feet of gross proven recoverable gas reserves in the structure.
The Grassim Oskolkoff No. 1 was drilled to a depth of 11,600 feet and encountered several gas-bearing sands, Marathon said. The Alaska Oil and Gas Conservation Commission shows the well as a directional hole, 11,600 feet measured depth and 8,510 feet true vertical depth, from an offshore surface location in section 23 of township 1 north, range 13 west, Seward Meridian, to an offshore bottomhole northwest of the surface location in section 15 of T1N R13W, SM.
Marathon said the test of one 39-foot interval at 9,822 feet flowed gas at 11.2 million cubic feet per day with a flowing tubing pressure of 1,565 psi. Unocal said the tested interval was in the Miocene formation and that several significant untested intervals exist in the well.
Marathon said three other wells are completed on the structure and await testing. Additional drilling is planned to delineate the structure’s upside potential.
Successful gas exploration “The Ninilchik discovery, together with our recent Wolf Lake production coming online, demonstrates Marathon’s continuing commitment to the Cook Inlet natural gas market,” John Barnes, manager of Marathon’s Alaska Business Unit, said in a statement. “In the last five years, Marathon has drilled six successful gas exploration wells in the Cook Inlet, and we remain committed to continued investment to establish the full potential of this gas-prone region,” he said.
“We are pleased with the initial results of our south Kenai gas exploration program and we look forward to working with Marathon Oil to fully appraise the potential of the Ninilchik structure,” Chuck Pierce, vice president of Unocal Alaska, said in a statement.
Pierce said Unocal has begun a separate three-well exploration program on the southern Kenai Peninsula which it expects to complete by May. Unocal has acquired a total position in excess of 80,000 net acres and believes the net unrisked resource potential of the Ninilchik unit and the additional prospects Unocal plans to test by mid-2002 could be between 100 and 600 billion feet. By the end of 2002, Unocal said, eight wells will have been completed and tested on the trend: five wells in the Marathon-operated Ninilchik unit and three wells on the other Unocal prospects.
Kenai-Kachemak pipeline “These wells have major implications for natural gas development of the southern Kenai Peninsula,” Pierce said. “Based on the results of the Marathon- and Unocal-operated programs, we expect to have sufficient gas resources to support construction of the proposed Kenai-Kachemak pipeline.”
Kenai Kachemak Pipeline LLC is a joint venture of Unocal and Marathon. The pipeline would connect the new producing area with the existing Southcentral Alaska pipeline system. Unocal said that upon completion of the pipeline, newly discovered resources would serve commercial and utility markets in Southcentral Alaska.
First production is expected to occur in late 2003.
Unocal said it has signed a contract to sell up to 450 billion cubic feet of natural gas to Enstar Natural Gas Co. beginning in January 2004.
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