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AEX has Corps permit for Placer road, pad
Company working permit side of project under terms of second amended 4th plan of development; facility sharing access work on hold Kristen Nelson Petroleum News
Under terms of the January conditional approval of the second amended 4th plan of development for its Placer project, ASRC Exploration LLC has submitted a quarterly update to the Alaska Department of Natural Resources’ Division of Oil and Gas.
The update was submitted by Chait Borade, who has succeeded Teresa Imm as president of AEX (see Oil Patch Insider in this issue of Petroleum News).
The progress report for April 1 to June 30 lists proposed operations to which AEX committed: 404 permit; NSB rezone; facility sharing agreement; and civil feed.
In addition to quarterly reports and meetings with the division, requirements of the second amended 4th POD included a $1 million performance bond which will be released to AEX if production begins from Placer no later than Oct. 31, 2022; if that production date is not met, the bond will be paid to DNR.
Permitting status AEX received a 404 permit from the U.S. Army Corps of Engineers on May 28, authorizing discharge of fill for construction of a 7-mile, 37-acre road, leading to a 7-acre pad. Gravel required for the pad is estimated at 68,000 cubic yards; gravel for the access road is estimated at 325,000 cubic yards. The Corps said the project’s total footprint is 44 acres.
The company also received a certificate of reasonable assurance under Section 401 of the Federal Clean Water Act of 1977 and provisions of the Alaska Water Quality Standards from the Alaska Department of Environmental Conservation for placement of dredged and/or fill material in waters of the U.S. associated with development of a gravel pad, a gravel access road and a three-phase pipeline.
The road to the proposed Placer drill pad is from the existing Mustang Road at the Mustang gravel mine.
AEX said its current DEC oil discharge prevention and contingency plan expires in November and it has submitted a plan renewal application and will be working with DEC during the review process.
The company applied to the North Slope Borough in March for gravel purchase from Mine Site F and said it has received a material sale contract for review and is having follow up discussions with UMIAQ on contract details and execution timing.
AEX said it is in discussion the Gordon Brower, director of the NSB Planning Department on the rezoning process for the project, and has been told it should take about four months due to location, smaller project size and the fact that AEX has received the USACE 404 permit. The company has a pre-application meeting with the borough July 22 and will submit the rezone application in the first half of August “pending a facility sharing agreement with the to be determined SMU operator.” (See page 1 story on Mustang foreclosure.)
Contracting status AEX said it has engaged PND to perform a civil study on the Placer surface facility. PND’s role will be to develop cost estimates and associated construction schedules, manpower projections and fuel usage estimates with the study expected to be completed by mid-August.
AEX has engaged with Nanuq/AFC in discussions about material quality, gravel extraction, ice road and placement of the gravel road and pad and will be working to firm up additional details in the next 30-60 days.
Facility sharing agreement AEX said it had been working with the Southern Miluveach unit operators on facility access and was notified at the beginning of May that the SMU operators were party to a foreclosure (see story on page 1 of this issue).
“With the notification that the project was going into a foreclosure through AIDEA, all future FSA negotiations are postponed until the end of the foreclosure,” AEX said.
AEX does not plan to have its own processing facilities and had been looking to SMU, Mustang, for access to such facilities.
Other potential resources “AEX has identified Kuparuk C as the anchor productive interval within the Placer Unit,” the company said in its second amended 4th POD, with plans to develop the Kuparuk C reservoir with two horizontal multistage fracked producers and two injectors.
The company said in the POD that it “has also identified and evaluated the Nanushuk Topset and Alpine C sands and plans to include these prospects in its future Development Plan.”
In the quarterly update the company said it “has continued the analysis of the Nanushuk interval because it could be a potential satellite development from the Placer Unit,” and said it is conducting reservoir modeling studies for developing the Eastern Nanushuk.
The Eastern Nanushuk within the Placer unit could potentially be developed with five producers and five injectors, AEX said, noting that in the 404 permit it “designed the drill site to be large enough to accommodate additional wells.”
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