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Drilling stable over 2016, 2017, AOGCC’s data analysis shows
Kristen Nelson Petroleum News
The variety of oil and gas drilling activity in Alaska was illustrated March 5 when Alaska Oil and Gas Conservation Commission commissioners Hollis French, the AOGCC chair, and Cathy Foerster, shared analysis of the agency’s data on drilling activity with the House and Senate Resources committees.
The commissioners illustrated their presentation with charts and graphs drawn from the commission’s data. A suite of those is posted on its website at: http://doa.alaska.gov/ogc/reports/reports.html.
The majority of the drilling is at producing fields on the North Slope - which the commission categorizes as the Arctic Slope - and Cook Inlet.
Foerster told Senate Resources that drilling and well work continued at a fairly steady pace in 2017, work which includes both drilling and repair of broken wells. In 2018, she said, the agency expects development activities to continue at about the same pace.
A pie chart of drilled wells and well branches for 2017 - AOGCC counts each branch of a multilateral well as a well- shows the variety of drilling activity which the commission permits. The largest category of the 152 items on the pie chart is 97 Arctic Slope oil production wells drilled. The next largest categories, service wells on the Arctic Slope and stratigraphic tests in Cook Inlet: each had 16.
There were 11 oil production wells drilled in Cook Inlet, and eight gas producers.
On the Arctic Slope three exploration wells were drilled in 2017. And there was a single service-injector well drilled in Cook Inlet.
The overall activity level compares favorably with 2016, when 154 wells were drilled, but the distribution of what was drilled was very different in that year: 108 oil producers drilled on the Arctic Slope; 27 Arctic Slope service-injectors; six Arctic Slope exploration wells; four Cook Inlet oil producers; four Cook Inlet gas producers; and one each Cook Inlet exploration well, Cook Inlet service-injector, mid-Tanana exploratory gas well, Bering Sea exploratory geothermal well and Copper River exploratory gas well.
More exploration this year Forester noted that exploration activity is up this year, with ConocoPhillips planning six to eight exploration wells, Eni drilling a well at Spy Island and Glacier Oil and Gas drilling at Badami. In 2017, Armstrong drilled two exploration wells and Accumulate a single well. This year, with the activity planned, exploration wells will be above five, she said, probably closer to 10.
Foerster said several operators were also plugging wells with no future utility or with issues.
Asked about workovers, French told House Resources workovers are something short of drilling a well. He said the way to look at it is if you don’t do this work the production decline would be a lot worse. As for the 2017 uptick in production, he said that is due to a lot of factors, including work done in 2015 and 2016.
The commission characterizes workover wells as production enhancements, including such activities as perforating, stimulating and re-entering suspended wells; maintenance, including activities such as repairing casing, pump maintenance and freeze protection; and other, a category which includes activities such as well abandonment, annular disposal and operational shutdown.
Referring to production data which AOGCC collects, Foerster said there was no decline in 2017, with Prudhoe Bay essentially flat from 2016, up just a bit. The same was true at Kuparuk. Colville River was up a bit, as ConocoPhillips continues to expand, she said. Oooguruk, Nikaitchuq and Point Thomson, shown combined, were also up a bit.
Drilling activity The commission also tracks drilling and workover rig activity by quarter. A chart of 10 years of activity shows there have been more than 30 rigs working in the state during that period, compared to a high of 13 in 2017. Recent rig activity topped out at 34 rigs, 18 drilling and 16 workover, in the third quarter of 2013 when the ANS West Coast average spot price was $110.80 per barrel - not the highest in the 10 years on the commission’s rig activity chart, which was $123.85 in the second quarter of 2008, but significantly higher than the $61.40 per barrel average in the fourth quarter of 2017 when 12 rigs, seven drilling and five workover, were active in the state. A graph of rig activity and ANS spot prices for the same period illustrates rig activity against a background of oil prices.
The commission also charts development and service well drilling by operator, with ConocoPhillips the leading driller in 2017, followed by BP and Hilcorp. ConocoPhillips and BP drill exclusively on the North Slope while Hilcorp is active both on the North Slope and in Cook Inlet. By numbers, ConocoPhillips drilled 72 development wells and service wells (including well branches on multilateral wells) in 2017, BP drilled 31, Hilcorp 27, BlueCrest (the operator at the Cosmopolitan project in Cook Inlet) drilled two and Cook Inlet Energy, a Glacier Oil and Gas company operating in Cook Inlet, drilled one.
- KRISTEN NELSON
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