Monday, May 09, 2011
Alaska Journal of Commerce
by Tim Bradner
BP has started up the first of four North Slope wells in a $100 million project to test heavy oil production technologies in the Ugnu formation.
The Ugnu is a large accumulation of heavy oil, with about 23 billion barrels of oil-in-place estimated, that overlies existing conventional oil fields on the North Slope. Ugnu oil was produced in am experimental test well drilled by BP two years ago, BP spokesman Steve Rinehart said.
The oil is thick and flows with difficulty. It measured 12 degrees API in the test well done by BP previously, Rinehart said.
API is an American Petroleum Institute index for oil quality.
Heavy oil from Ugnu is seen by BP and others as one of three unconventional sources of oil production that could supplement declining conventional oil production on the North Slope.
The others are production of viscous oil, also a lower quality oil that is about 19 degrees API and which lies in deeper formations than the shallow Ugnu accumulation. Viscous oil is being produced now.
A third potential type of unconventional oil that could be produced is shale oil production from the large layers of shale on the North Slope that are the source rocks for the conventional oil fields now producing. Independent oil and gas company Great Bear Petroleum will drill a well in 2012 to test whether shale can be produced from North Slope shale rock.
The major challenge in producing oil from Ugnu is the thickness of the oil and its temperature, which is about 70 degrees Fahrenheit in the shallow formation. The oil lies just below the permafrost that under the North Slope -- the wells will produce from depths of about 3,800 feet to 4,400 feet -- and the oil, thick and cool, will have be made to flow upward through the 2,000 feet of frozen permafrost to the surface.
Rinehart said BP will test two production procedures in its project. One is a technique called cold heavy oil production with sand, or CHOPS, that is now being used in Alberta to produce from oil sands. A second method involves producing the oil from horizontal production wells drilled laterally through the oil-bearing rock, a technique now common on the North Slope.
The first well, now producing about 350 barrels per day, is a horizontal well that was drilled 3,800 feet vertically and 3,500 horizontally, with 1,500 feet "perforated" for production, Rinehart said.
The second well is planned to begin production in May, he said. It will be a CHOPS well, Rinehart said, where a progressive cavity pump, an auger device, is installed in the well to create enough pressure to draw sand out of the formation to create fissures allowing the heavy oil to flow.
A progressive cavity pump also is installed in the horizontal well now producing to aid production, he said.
One of the problems in producing heavy oil, and also the somewhat higher-quality viscous oil, is sand that is produced up the well along with the crude oil. As oil is withdrawn from the weak rock that holds the heavy and viscous oil, sand is broken loose and flows with the oil into the well, where it can cause damage to the wells and the surface facilities that process the oil.
Companies producing viscous oil, including BP, have found ways to allow the sand to flow without causing damage, and to separate it from the oil at the surface.
In the heavy oil project a specially built processing facility separates and stores the sand until it can be trucked to an underground disposal well to inject the sand back underground.
Rinehart said the heavy oil also must be heated before it is pumped on by pipeline to Pump Station 1 of the Trans-Alaska Pipeline System, where it is mixed with other, conventional crude oil for shipment south.
"Our goal here is data collection, but we are also processing and selling the oil we produce," Rinehart said. The test production project is on S Pad in the Milne Point field.
"The project is going well so far. There is a lot of oil in place but there are a lot of production challenges. We need to ensure we can produce it on a sustainable basis. Once we understand the engineering and physics, we can have a conversation about the economics," Rinehart said.
BP's plan is for the test production program to be run for three to five years, Rinehart said. By then enough data will be in-hand to make a judgment on possible commercial production.
Copyright (c) 2011, Alaska Journal of Commerce, Anchorage. Distributed by McClatchy-Tribune Information Services.
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