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Anadarko, Phillips hope to declare NPR-A prospect commercial in 2002 Anadarko’s Pease expects company to spend $100 million in Alaska this year; applauds state’s royalty gas sale; says pipeline access critical to gas explorers By Kay Cashman PNA Publisher
Mark Pease, Anadarko Petroleum Corp.’s new vice president of international and Alaska operations, said his company expects to spend $100 million in Alaska this year. That compares to a total of $430 million spent over the last 10 years in the state, a signal that Anadarko’s “capital commitment to Alaska is growing,” he told Meet Alaska attendees Jan. 25.
It was especially significant since earlier this month Anadarko said it expected to cut its worldwide capital spending in half.
Pease had more good news.
He said Anadarko and its partner, Phillips Alaska Inc., hope to declare their Moose’s Tooth prospect in the National Petroleum Reserve-Alaska commercial this year.
The Moose’s Tooth discovery was announced May 21 by Phillips Alaska President Kevin Meyers and is approximately 20 miles southwest of the new 430 million barrel Alpine oil field.
Ownership in Moose’s Tooth and Alpine is split between Phillips at 78 percent and Anadarko at 22 percent. Phillips is the operator of both.
In the next few days, Anadarko expects to spud the Altamura No. 1 exploratory well just south of Moose’s Tooth. Anadarko owns 100 percent of the Altamura well lease.
“With the information from this well and some additional delineation wells we’ll drill with Phillips, we hope to be able to declare Moose’s Tooth commercial this year,” Pease said. If that happens it will be the first commercial discovery in NPR-A. Anadarko an Alaska operator for first time Anadarko is the operator at Altamura — the first time the company has operated on the North Slope, despite the fact it has the second-largest acreage position in Alaska, with access to nearly 2 million net acres of state and federal leases, as well as exploration rights on land in the Brooks Range foothills that is owned by Arctic Slope Regional Corp.
Phillips is Anadarko’s partner and the operator “in a little less than half” of Anadarko’s acreage in NPR-A and in the central Arctic, Pease said.
But Anadarko is the operating partner for the rest of its properties, which are mainly in the Brooks Range foothills. Alberta Energy Corp. and BP Exploration (Alaska) Inc. are equal partners with Anadarko in most of the foothills area, he said. Expects to drill in foothills next winter “We’ll be conducting company-operated seismic work this winter for the second year in a row in the foothills — both 2-D and 3-D seismic,” Pease said. Anadarko hopes to drill its first prospects in the foothills next winter. (See related PNA story in the August issue.)
“Exploring new plays in the foothills will be a big departure from the location and direction of most of the activity Alaska has seen historically — which has traditionally been for oil in the coastal plain,” Pease said, noting that most of the foothills is believed to be gas-prone versus oil prone.
A pipeline to take the slope’s natural gas to market would result in gas exploration and field development, he said, which would create jobs, contracts for materials and services, and taxes and royalties to the state.
“If we make a commercial discovery, we’ll invest an estimated $1.8 billion or so to develop the field. A field development project could create roughly 75,000 jobs and generate as much as $10 billion in total economic impact for the state. That’s for a single field development,” Pease said.
“There’s the potential for additional development resulting from a large oil discovery or additional gas discoveries — as long as space is available in a gas pipeline. We’ve identified four separate prospects that we believe are good, solid candidates for drilling in the next few years, plus we have seven other leads that are in various stages of study,” he said. Must have access to gasline But Anadarko is not going to invest millions in gas exploration if it isn’t assured that it has space on a natural gas pipeline that ships North Slope gas to market.
“We have to ensure there’s space available on the pipeline for new gas discoveries — not just for the blow down at Prudhoe Bay,” Pease said. “This is critical to explorers like Anadarko, and other companies who may join the hunt for new Arctic gas in the future.”
The resource potential for new Alaska gas discoveries is “more than twice as large as the existing gas cap at Prudhoe,” he said. “But there won’t be any new gas exploration and development without assured access to a pipeline.
“To put it simply, if we can’t transport it to market, we’re not going to invest hundreds of millions of dollars looking for it,” Pease said.
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