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Vol. 24, No.42 Week of October 20, 2019
Providing coverage of Alaska and northern Canada's oil and gas industry

Another new pad

Hilcorp looks to expand Milne access to undeveloped Schrader Bluff, Kuparuk oil

Kay Cashman

Petroleum News

Following close behind Moose pad, which began oil production in April, Hilcorp Alaska is planning to add another new pad, Raven, in the North Slope Milne Point unit in order to access more untapped oil in the Schrader Bluff and Kuparuk reservoirs.

On Oct. 9 the US Army Corps of Engineers issued a public notice regarding Hilcorp’s application to build the 1,700 feet long by 615 feet wide gravel well pad, widen a road, and install vertical support members for a pipeline.

Raven pad, Hilcorp told the agency, would support new wells, a processing facility, pipeline and utility connections to existing infrastructure, and other facilities to support oil production and transport.

A short section of an existing road along the proposed pad would be widened by 6 feet to provide maneuverability for “large drill rigs.”

The work being proposed includes the discharge of up to 262,200 cubic yards of gravel into 28.61 acres of U.S. waters, including wetlands, the application said.

Gravel would be hauled to the construction site in winter over a 4.2 mile ice road from Ugnu Mine Site E (see Milne Point overview map and the Raven pad plan in the pdf version of this story).

The project site is in “Section 6 and 7, T. 13 N., R. 10 E., Umiat Meridian; USGS Quad Map Beechey Point C-5; near Latitude 70.50173º N., Longitude 149.66902º W.; approximately 35 miles northwest of Deadhorse Airport and five miles west of Milne Point,” the Corps said.

Proposed schedule

Construction of the ice road from the mine site is expected to begin in December and be completed in February, Hilcorp said.

Pad and road construction will begin after the ice road is finished and require approximately three months to complete.

In July 2020, once the ground is thawed, the pad and road surface will be turned and re-compacted, Hilcorp said.

Flowline construction will occur during the following ice road season.

Pad utilities and infrastructure will be installed following pad compaction.

Producing since 1980s

Hilcorp became operator at Milne Point in November 2014 when its acquisition of several North Slope properties from BP closed, including a 50% interest in Milne. Since then Hilcorp has been successfully working to increase Milne oil production, which per Alaska Oil and Gas Conservation Commission data averaged 18,177 barrels per day in October 2014 as compared to a July 2019 average of 26,765 bpd - not bad for a mature field that has been producing since the 1980s.

Hilcorp currently has production from 12 pads at Milne, including Moose pad, which was the first new pad in the unit since 2002.

Two to three pads

In an April application to the Corps to expand gravel mining at Milne, Hilcorp mentioned the new pad, simply referring to it as R pad

Hilcorp told the Corps it required “enough gravel for 2 to 3 pads initially.”

The R pad development would be south of F pad, the company told the Corps, noting that additional pad expansions would be required for new wells to increase Milne Point unit production.

F pad is the most northerly of the Milne Point pads, near the Beaufort Sea coast and northeast of L pad (see map).

The new mining was estimated to occur from 2019 to 2024 (see the May 5, 2019 edition of Petroleum News for the full story).

Ahead for Milne Point

The initial production rate for Moose pad was 3,000 bpd from two wells, Hilcorp spokeswoman Lori Nelson told Petroleum News in an April 15 email.

In a presentation last November, David Wilkins, Hilcorp’s senior vice president for Alaska, told the Resource Development Council that the pad can accommodate 50 to 70 wells - and that processing facilities at Moose pad can handle 85,000 barrels of fluid per day.

Nelson said Hilcorp will invest a total of $400 million “to fully develop Moose pad and its facilities.”

Peak production from the pad is expected to be 22,000 bpd.

That level of detail has not yet been released by the company for Raven pad.

Milne Point mainly produces from the Kuparuk (light oil) and Schrader Bluff (viscous oil) reservoirs and will soon again be producing from the Ugnu and Sag River (both viscous) reservoirs, per Hilcorp’ s most recent plan of development that was filed with Alaska’s Division of Oil and Gas.

Currently, the field’s output is split almost half and half between light and viscous oil, but as the field ages, Wilkins said, those percentages will change, and more viscous oil will be extracted.

On June 10, Hilcorp received authorization from the Division to install a third polymer injection facility in the Milne Point field, this time at F pad.

Injecting polymer and water into the field has been more successful in coaxing the viscous crude - oil with the consistency of syrup - from the reservoirs than conventional waterflood, Wilkins said.

Both J pad and Moose pad already have polymer injection facilities.

Using polymer, Hilcorp expects to increase crude recovery from 10 to 15% of the oil in place at Milne to as much as 50%, per slides Wilkins used in his November presentation. According to Hilcorp there are approximately 1.3 billion barrels of viscous oil in the Milne Point unit.

Injecting polymer along with water into a reservoir for enhanced oil recovery, Wilkins said, is a technique that has a 30-year track record in other parts of the world but had not been tried on the North Slope until Hilcorp installed a small facility on J pad.

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