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ConocoPhillips’ 2007 exploration program in Alaska to top ’06 effort Company President Jim Bowles tells RDC conference Conoco drilled smaller plays closer to infrastructure last year; in 2007 company going back into NPR-A, as far west as Barrow Kristen Nelson Petroleum News
ConocoPhillips Alaska focused its 2006 exploration close to existing infrastructure at Kuparuk and Alpine, the company’s president, Jim Bowles, told the Resource Development Council’s annual conference in Anchorage Nov. 15, operating five wells and participating in two others, including West Sak wells at Kuparuk and a shallower-horizon well, Qannik, at Alpine.
This year, however, the company plans a bigger exploration program.
There are still satellite-type wells, one West Sak and one Tarn, low-risk and lower reserves, “something that we can develop quickly should we be successful,” Bowles said.
“But probably the more exciting part of our program in 2007 will be moving back into NPR-A.”
He said ConocoPhillips is looking at three wells in the National Petroleum Reserve-Alaska.
The first, Noatak, south of Teshekpuk Lake, is one ConocoPhillips wanted to drill two years ago, Bowles said, “but this winter season we plan to lead off with Noatak.”
What the company is targeting at Noatak, he said, “probably will not be a large reserve potential,” but if the well is successful the resource could be tied back to Kuparuk or Alpine “or maybe even Greater Moose’s Tooth if that’s developed at some future date.” Moose’s Tooth is between Noatak and Alpine, in the area 15-25 miles southwest of Alpine where the company announced discoveries in 2001 at Spark 1 and 1A, Moose’s Tooth C, Lookout 1 and Rendezvous A and 2. All the wells targeted the Alpine producing zone.
The Noatak 1 well, permitted in 2005, is in section 22, township 12 north, range 5 west, Umiat Meridian. A Spark well was also listed on the 2007 planned exploration activity slide Bowles showed: The Spark 8 well was permitted in 2004, and never drilled, in section 6, T10N-R1E, UM.
The third well, Intrepid, south of Barrow, “is quite a ways from any infrastructure,” Bowles said. Because of the distance, more than 200 miles from Alpine, “it needs to have a fairly large reserve base behind it” for it to be developed, he said. Intrepid is south of the gas field which serves Barrow, but USGS told Petroleum News earlier this year that they believe this is an oil play (see story in Oct. 15 issue of Petroleum News).
Logistics an issue Logistics is an issue for this winter’s work because of the distance between Noatak and Intrepid, Bowles said.
Bowles said ConocoPhillips will be bringing in the Kuukpik 5 rig which has worked in Cook Inlet, “a modularized rig that can be moved with rolligons.” Because the rig can be moved on rolligons, he said, it allows ConocoPhillips to use snow-packed roads rather than ice roads. Constructing an ice road from Noatak to Intrepid in one season “would be something that would not be doable,” he said.
The Arctic Sounder reported in its Nov. 16 issue that the packed snow road across NPR-A is a concern to the North Slope Borough because it opens up a road route from the Dalton Highway almost clear to Barrow. Since it costs some $5,000 to transport a vehicle to Barrow, the Sounder said, people may try to drive the packed snow road, even though it is designed for rolligons, not for tired vehicles. The borough is concerned both about tundra damage from tired vehicles and about the possibility that travelers could become stranded on the snow road in bad weather.
The Bureau of Land Management is planning to set up an office in Barrow to be manned by Ben Nageak, and that office was suggested as a communication point, but no solution was found for the safety concerns at a Nov. 9 meeting in Barrow, the Sounder said, and travel would be at one’s own risk.
Kuukpik 5 is a 10,000-foot rig, and is set up for possible adoption of new drilling technologies such as cased drilling.
Bowles said using the modularized smaller rig is a step-out for ConocoPhillips this year, and said the company thinks using small rigs is the way exploration will be done in the future.
ConocoPhillips plans simultaneous construction of the ice pads at Intrepid and Noatak, and Bowles said that once the rig is through at Noatak, about half of the loads will probably be airlifted to Intrepid in order to get that drilling done this season.
Chukchi more exciting Bowles said the potential of the Chukchi Sea is more exciting even than NPR-A. The Minerals Management Service is proposing a sale for 2007, and the Chukchi Sea planning area is more than 34 million acres, compared to 23 million acres in NPR-A.
Even more exciting than the large size, he said, is the limited amount of exploration that has been done there: just five wells. Of the five (Popcorn, Crackerjack, Klondike, Burger and Diamond), the Burger is a discovery with MMS putting the resource there at some 14 trillion cubic feet of gas, “so we know there is at least one large potential play out there and probably much, much more in this basin.”
But this big play will have big dollar costs and big challenges, Bowles said.
Just getting seismic this year was a challenge, he said.
A 3-D survey ConocoPhillips did in the Chukchi required mobilization of a ship out of the Mediterranean. Then the window to shoot seismic is very limited because of the ice season, “even with this ice-hardened vessel,” he said, some three months. And the vessel “got chased off early by the ice” and couldn’t gather as much data as planned. “It’s a big challenge just even collecting up-front data,” Bowles said.
The area will have to be monitored for whales, and Bowles said ConocoPhillips has tested a drone (see story in Nov. 5 issue of Petroleum News). The area is far from shore and drones would be a safe way to monitor so that seismic surveys could be shut down if whales came through the area.
Bowles also said keys to success in an exploration program include fiscal certainty in Alaska, as well as the ability to work with non-governmental organizations which see Alaska as “an important part of their focus. For us to be successful as a company, he said, whether it’s in NPR-A or in the Chukchi Sea or the Beaufort,” the company will have “to figure out how to work with the NGOs and make sure that we can find solutions that work for everyone.”
Good environmental stewardship is also essential, he said, as is a gas pipeline. “When we’re out exploring, we may be looking for oil, but we’re not always as good as we think we are and we’ll find gas from time to time. And the ability to market that gas is going to be a huge plus for our exploration program as others.”
A gas pipeline, Bowles said, will also “spawn an entire new business in the state of Alaska with exploration activity.”
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