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Vol. 23, No.21 Week of May 27, 2018
Providing coverage of Alaska and northern Canada's oil and gas industry

Master plan filed

ConocoPhillips indicates Willow standalone processing facilities needed

Alan Bailey

Petroleum News

In what the company refers to as a proposed master development plan for its major Willow oil discovery in the northeastern National Petroleum Reserve-Alaska, ConocoPhillips has indicated that it will need to construct standalone production facilities, rather than hook Willow production into the production facilities for the Alpine field. The company has filed the plan with the Bureau of Land Management and has asked the agency to start the process for an environmental impact statement for a Willow development. The company has yet to prepare a full-scale plan of development for the field but presumably wants to start the EIS process, given the length of time typically required for this type of environmental review. Being located in federal land in the NPR-A, any permitting for a Willow development would inevitably trigger an EIS.

Scale of discovery

ConocoPhillips has made little information publicly available about the scale of its Willow find in the Bear Tooth unit, beyond saying that the prospect holds at least 300 million barrels of recoverable oil. The company has previously said that it could tie the field into the Alpine field processing facilities in a manner analogous to the Greater Mooses Tooth 1 and 2 developments, also in the northeastern NPR-A. Alternatively, if the field is large enough, standalone Willow production facilities could be justified. Standalone facilities, while much more expensive than the Alpine tie-in option, would enable much higher oil production rates - peak production from standalone facilities could reach as much as 100,000 barrels per day, the company has indicated.

The Willow discovery involves reservoir sands in the Nanushuk formation, in a near identical geologic setting to the huge Pikka/Horseshoe field that Oil Search plans to develop, east of the Colville River.

Successful appraisal

Following a successful appraisal drilling project this winter, ConocoPhillips has sounded increasingly optimistic about its Willow find. In April, during a ConocoPhillips earnings call, Al Hirschberg, the company’s executive vice president of production, drilling and projects, indicated that the company was leaning towards a standalone development. Statements in the new master development plan appear to indicate that the standalone option has now been chosen, a decision that suggests that the find is towards the larger end of the size estimates.

“The existing processing facility at Alpine is not feasibility for a tie-in of the Willow development due to geographic and technical constraints,” the plan says. “The Willow master development plan would require construction of a new processing facility, the Willow Central Facility.”

Infrastructure construction

ConocoPhillips’ Willow plan envisages the construction of an infrastructure pad with a camp, located separately from the processing facility. A road and pipeline corridor would connect to existing infrastructure in the Greater Mooses Tooth unit. The plan says that the anticipated size of the Willow Processing Facility would be similar to a hypothetical facility evaluated in the 2004 Alpine Satellite Development Plan Final EIS - that EIS envisaged the possibility of the future development of a processing facility in the NPR-A, similar in size and footprint to the central processing facility for the Alpine field.

The plan anticipates the possibility of Willow-related infrastructure construction over a period of around 10 years, with the possibility of up to five drill sites, in addition to the central facility, the infrastructure pad, gravel access roads, a 5,400-foot airstrip, pipelines and a gravel mine.

The plan also anticipates the possibility of more future drill sites, depending on the results of future exploration activities.

The larger modules for the Willow infrastructure would be transported by barge and likely offloaded from a location in state waters of Harrison Bay, near Atigaru Point, for transportation by ice road to the Willow site. Alternative module transfer locations will also be considered, the plan says.

Existing infrastructure

The Willow development would leverage existing infrastructure by constructing a Willow pipeline that would carry sales-quality crude from the Willow processing facility to a tie-in with the Alpine pipeline near the CD-4 pad. Seawater and diesel pipelines would run from the Kuparuk River unit to Willow using existing and new transportation corridors.

The plan also says that a newly discovered gravel source near the Tinmiaqsiugvik River is the closest known gravel resource for the development. There are, however, alternative possible sources of gravel.

ConocoPhillips told the BLM that a Willow development would support the agency’s mandate to develop petroleum resources from the NPR-A, while also protecting important surface resources. The development will also increase oil exports through the trans-Alaska pipeline while generating NPR-A environmental impact mitigation funds, generating federal state and local revenues, creating jobs and increasing U.S. energy independence, ConocoPhillips said.

Announced in 2017

The company first announced its Willow discovery in January 2017, following the drilling of the Tinmiaq No. 2 and Tinmiaq No. 6 wells. However, it appears that the company actually found the Willow oil pool in 2002 through the drilling of the Hunter A well - the company kept the results from that well highly confidential. It is likely that the company did not immediately decide to pursue the development of Willow following the Hunter A discovery, because at that time the company was fully occupied with development activities in the Colville River unit, and because the oil infrastructure did not then extend far enough west to render a Willow development viable.

This winter ConocoPhillips further appraised the find through the drilling of the Tinmiaq Nos. 7, 8 and 9 wells.

The company has for several years been following a policy of progressively developing oil discoveries west, stepping out from the Alpine field into the northeastern NPR-A. As each new development comes on line, another development further to the west starts to become viable.

A large prospect

And the Willow discovery appears large. A scientist from Alaska’s Division of Oil and Gas has suggested that, based on an interpretation of publicly available seismic data, the prospect could be 25 miles in extent, with a net pay thickness of 40 to 70 feet and a reservoir depth a little over 4,000 feet. As in the Pikka/Horseshoe discovery, the reservoir is in sand that was deposited on the margin of a marine basin, as that margin migrated from west to east. The sediments that formed the Nanushuk would have settled in the nearshore region of the margin, while the underlying sediments, forming the underlying Torok formation, would have been deposited in deeper water.

The oil found in the Nanushuk reservoirs tends to be relatively light, a factor that is likely to help with production from reservoir rocks that can have somewhat variable reservoir quality.

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