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- Want a weekly review of refining news?
10 March 1997
Oil has been found in two delineation wells and a sidetrack in the Tarn Prospect west of the Kuparuk River Field on Alaska's North Slope, it was reported today by ARCO Alaska, Inc., and BP Exploration (Alaska) Inc.
Testing of the Tarn #2 well yielded a steady, stimulated flow rate in excess of 2,000 barrels per day of 38-degree API gravity oil from a sandstone reservoir discovered at a depth of 5,200 feet. Tarn #2 is the first well drilled in this year's three-well Tarn exploration program.
The two companies are assessing Tarn to determine potential reserves. A third delineation well is expected to be completed this month.
ARCO Alaska, Inc., a wholly-owned subsidiary of Los Angeles-based ARCO (NYSE: ARC), holds a 58.5% interest in the Tarn Prospect. BP Exploration (Alaska) Inc., a wholly-owned subsidiary of BP America, holds a 41.5% interest.
At the same time, ARCO and BP announced the signing of an alignment agreement that will quicken the pace of oil exploration in and around Kuparuk, the second largest oil field in Alaska and North America.
The agreement provides for joint exploration and appraisal of a 580-square-mile area that includes the ARCO-operated Kuparuk River Unit and adjacent acreage. The agreement also allows production of satellite oil accumulations through existing Kuparuk facilities and clears the way for West Sak development.
"This agreement will allow us to unlock the full potential of the Greater Kuparuk Area," said Ken Thompson, president of ARCO Alaska, Inc., "It encourages exploration, facilitates development and maximizes use of existing facilities. When we have exploration succcess it will allow us to move new production quickly to market."
"The agreement establishes a new, more cooperative way of doing business on the North Slope," said Richard Campbell, president of BP Exploration (Alaska) Inc., "It will accelerate resource development, provide opportunities for Alaskans and enhance state revenues."
Joint exploration drilling during 1997 may include two prospects in addition to Tarn — Cache and Tabasco. Cache will test three prospective horizons below the Kuparuk reservoir. A well drilled and tested in 1995 indicated the shallow Tabasco prospect could be commercial. A planned 1997 well will test a separate Tabasco accumulation identified with data from a 3-dimensional (3-D) seismic survey.
The 1997 joint exploration program also includes a major 3-D seismic survey designed to better delineate known prospects and to identify new ones.
To date, the Greater Kuparuk Area joint exploration team has identified more than 10 satellite prospects — including the West Sak heavy oil accumulation — which together could yield potential reserves of almost 1 billion barrels.
The Greater Kuparuk Area encompasses a 580-square-mile area leased from the State of Alaska. The agreement aligns all ARCO and BP ownership of tracts within the Greater Kuparuk Area at 58.5% for ARCO and 41.5% for BP. Ownership of existing Kuparuk production is not changed by the agreement.
Production resulting from development of West Sak and other satellite accumulations will mean additional state revenue.
As previously announced, West Sak development is expected to begin in October with first production before year end. Initial plans call for the drilling of 50 wells and the installation of associated facilities. West Sak development will make extensive use of existing Kuparuk drill sites, common lines and production facilities.
Phase I will develop 51 million barrels of new reserves and add production of 7,000 barrels per day. Total development of the West Sak core area could require 500 additional wells, develop additional potential reserves of 400 million barrels and yield additional production of 62,000 barrels per day.
- [ Oil Found in Tarn Prospect on Alaska's North Slope; ARCO, BP Agreement to Speed Kuparuk-Area Explora]
