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Ugnu expansion to yield 1 billion barrels
Hilcorp’s proposed Milne Point unit S Pad project involving 10 new wells expected to increase crude output from viscous reservoir Kay Cashman Petroleum News
The U.S. Army Corps of Engineers issued a 30 day public notice March 9 soliciting comments on Hilcorp Alaska LLC’s proposed Milne Point unit S Pad expansion that will allow the independent to drill 10 new wells to increase production from the Ugnu reservoir.
There is an estimated 18 billion barrels of heavy oil known to exist in the shallow Ugnu formation above the reservoir rocks of major oil fields on Alaska’s North Slope. In a Feb. 26 presentation to a meeting of the House and Senate Resources committees David Wilkins, senior vice president of Hilcorp Alaska, said conventional Ugnu wells at Milne Point alone could produce a billion barrels of recoverable oil.
Hilcorp took over operatorship of the mature Milne Point oil field in November 2017 from BP Exploration (Alaska) and filed the 38th plan of development for the Milne unit with Alaska’s Division of Oil and Gas, which was effective Jan. 13 and runs through Jan. 12, 2021.
The Milne Point field has four oil pools; starting with the shallowest, they are Ugnu, Schrader Bluff. Kuparuk River and Sag River. Ugnu oil is the thickest, coldest and most difficult to extract, making it too viscous to flow unaided through a pipeline and expensive to develop, while also being the least valuable of all North Slope crudes.
The work proposed to expand S Pad, which is approximately 27.5 miles northwest of Deadhorse, is the discharge of 16,000 cubic yards of gravel fill into 2.04 acres (approximately a square shape of 328 feet by 319 feet with a cut out for an existing rectangular pad 179 feet by 96 feet toe-to-toe) of Palustrine emergent wetlands
Hilcorp’s schedule On Feb. 20 the Division of Oil and Gas posted a 30-day public notice for the same S Pad expansion project.
In its application to the division, Hilcorp’s schedule for the project was to place gravel for the pad extension starting March 20, finishing it by May 1.
Drilling of the 10 new wells was to begin next and be done on May 1, 2021.
June1 was the proposed start date for the installation of piping, tie-ins and associated infrastructure, with completion by July 1, 2021.
Hilcorp said half the new wells would be “Jet Pump producers and half injectors as currently planned.” But as drilling continued results might “necessitate adjustments to the pumping mechanism or ratio of producers to injectors.”
Additional infrastructure, “including a traditional test separator, heaters, polymer facilities, and pump drives, may be installed on pad, but these will be permitted separately once we have the design finalized,” the company told the division.
Minimizing impacts In its Corps application Hilcorp said it has minimized the amount of gravel by reducing the footprint necessary for additional development wells and associated infrastructure.
Although a much larger pad expansion was permitted at S Pad in 2008, Hilcorp has minimized the current expansion to include only the area required to position the rig on the wells and have safe emergency access around the rig. The company reduced the expansion by approximately 9 acres to 2.04 acres from the originally permitted project.
Gravel placement for the expansion is planned for winter to minimize impacts to migratory birds.
In Hilcorp’s plan road and pipeline crossings are aligned perpendicular or near perpendicular to watercourses and pipelines use existing transportation corridors where conditions permit.
In areas with above ground placement, pipelines are designed, sited and constructed to allow for the free movement of wildlife and to avoid significant alteration of caribou and other large mammal movement and migration patterns. At a minimum, the company said. aboveground pipelines will be elevated 7 feet, as measured from the ground to the bottom of the pipeline, except where the pipeline intersects a road, pad or a ramp installed for wildlife passage. (Hilcorp will allow for snow depth.)
Pipelines and gravel pads are designed to facilitate the containment and cleanup of spilled fluids.
Any water intake structures in fish bearing or non-fish bearing waters will be designed, operated and maintained to prevent fish entrapment, entrainment, or injury.
Hilcorp told the Corps that it will consult with the Alaska Department of Fish & Game and the U.S. Fish and Wildlife Service and conduct forward looking infrared or other bear den detection surveys in areas of high likelihood of bear dens before beginning winter activities to identify the locations of known brown bear and polar bear den sites occupied in the season of proposed activities.
The company said exploration and production activities will not be conducted within one-half mile of occupied brown bear dens and within one mile of occupied polar bear dens unless alternative mitigation measures are approved by the appropriate agency - ADF&G or USFWS
Hilcorp has prepared and implemented a human-bear interaction plan designed to minimize conflicts between bears and humans.
Permanent, staffed facilities will be sited to the extent practicable outside bird nesting and brood rearing areas.
Traditional and customary access to subsistence areas will be maintained unless reasonable alternative access is provided.
The complete list of mitigation measures can be found at http://www.poa.usace.army.mil/Missions/Regulatory/PublicNotices.aspx
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