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Vol. 25, No.19 Week of May 10, 2020
Providing coverage of Alaska and northern Canada's oil and gas industry

Hilcorp survey approved

BOEM gives go ahead for geohazard survey for Lower Cook Inlet drilling sites

Alan Bailey

for Petroleum News

On May 1 the Bureau of Ocean Energy Management announced that it had issued a permit, allowing Hilcorp Alaska to conduct a geohazard site clearance survey in federal waters of the Lower Cook Inlet, southwest of Kachemak Bay. The approximately 88 square-mile survey area covers portions of 11 of 14 outer continental shelf leases that Hilcorp obtained in a June 2017 federal OCS lease sale. A geohazard survey of this type is an essential prerequisite to the drilling of offshore exploration wells. Federal regulations require a hazard evaluation to be conducted over the entire area within about 1.5 miles of a well site.

BOEM said that Hilcorp expects to begin the surveying in late summer and that the survey operations must be completed by Oct. 31. The exact length of the survey timeframe will depend on the weather and on any schedule adjustments needed to accommodate the protection of marine mammals, the agency said.

A geohazard survey vessel will conduct the operation, with data being collected using equipment mounted on and towed behind the vessel. In addition to using shallow seismic equipment such sidescan sonar, Hilcorp anticipates collecting water and seabed sediment samples, while also collecting cores from the seabed, BOEM’s approval document says. Trained observers on the vessel will monitor for marine mammals, to ensure that appropriate measures can be taken to avoid wildlife disturbance.

Environmental impact assessments

BOEM said that it had originally conducted an analysis of the potential environmental impacts of Hilcorp’s likely activities, including the geohazard survey, when preparing an environmental impact statement for the 2017 Lower Cook Inlet lease sale. The agency has now determined that this analysis had been sufficient to enable approval of Hilcorp’s survey permit application without further review.

In July of last year the National Marine Fisheries Service issued a letter of authorization for the unintended disturbance by Hilcorp of marine mammals during the company’s anticipated oil and gas activities throughout the Cook Inlet over the next five years. Those activities included conducting a 3D seismic survey in the Lower Cook Inlet in 2019 or 2020; conducting an outer continental shelf geohazard survey in the Lower Cook Inlet in 2020 or 2021; and drilling two to four exploratory wells between February and November in 2020 through 2022. Each well would take 40 to 60 days to complete and would require a jack-up rig, the letter of authorization said. The newly approved plan for the geohazard survey encompasses five potential well locations.

Seismic in 2019

Hilcorp conducted its planned offshore 3D seismic survey during the summer of 2019.

However, given the likely timing of the geohazard survey, as indicated in BOEM’s letter of authorization, it appears that Hilcorp may move ahead with the survey but will not start its offshore exploration drilling this year.

In March Hilcorp Senior Geologist Dave Buthman told the Alaska Geological Society that Hilcorp was working to bring the Seadrill West Epsilon jack-up rig to Cook Inlet for the planned offshore drilling. There are two jack-up drilling rigs currently stationed in the Cook Inlet region: the Spartan 151 and Randolph Yost rigs. But both of these rigs are apparently limited to maximum water depths of 150 feet. In March 2019 Mike Dunn, Hilcorp development manager, told the Alaska Support Industry Alliance that the water depth at the proposed drill sites is at least around 180 to 190 feet. Buthman said that the West Epsilon rig can drill to subsurface depths of 25,591 feet in water depths up to about 393 feet.

Highly prospective

Although some distance south of most of the producing Cook Inlet oil and gas fields, the area of the planned drilling is north of the Augustine-Seldovia arch, a geologic structure to the south of which the thick Tertiary rock sequence hosting the producing fields of the region thins out. The successful Cosmopolitan oil field lies under the nearshore waters of the Inlet immediately to the northeast, near where Hilcorp is planning to develop its new Seaview gas field. Underneath the Tertiary sequence lies a thick sequence of Mesozoic strata that also have known oil potential.

Buthman told the Geological Society that Hilcorp is particularly interested in what it refers to as the Blackbill prospect, an oil prospect penetrated by ARCO’s Raven No. 1 well in 1982. The prospect, about halfway across the inlet, due west of the town of Homer, contains a known oil resource in a Cretaceous reservoir within the Mesozoic sequence, Buthman indicated. He said that Hilcorp’s 2019 3D seismic survey had revealed a 65,000-acre, four-way closure with the oil discovery at the top.

Hilcorp also has exploration interests on the Iniskin Peninsula, immediately west of the company’s offshore acreage. There is known oil potential in the Mesozoic in the Iniskin area.

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