How much longer for the North Slope?

A new U.S. Department of Energy report concludes production from Alaska's oil fields can continue for another 30 years, longer if more oil fields are discovered.

The report -- "Alaska North Slope Oil and Gas: A Promising Future or an Area in Decline?" -- looks at what's known about existing oil fields, recent exploration, development plans and the technology of producing oil and gas.

The report concludes that in the absence of any new oil-field development, the existing fields probably could produce about another 6.1 billion barrels of oil.

PIPELINE FLOW FALLS

Based on estimated decline rates of production, flow rates through the trans-Alaska oil pipeline would drop below the 200,000-barrel-per-day mechanical limit for the pipeline by 2039, with that date being extended to 2045 if new oil comes online from fields being developed or under evaluation, the report says.

A shutdown of the pipeline in 2045 "would potentially strand about 1 billion barrels of oil reserves from the fields analyzed," the report said.

GAS PIPELINE IMPACT

If a North Slope natural gas pipeline is built, estimated gas reserves in the Prudhoe Bay and Point Thomson fields would provide about 32 trillion cubic feet of the 57.5 tcf of natural gas required to support the pipeline with a capacity of 4.5 billion cubic feet per day and a 35-year lifespan, the report said.

"The assurance of a gas pipeline to transport the gas to market is needed to encourage exploration and development of sufficient gas resources to support the gas sales project," the report said. "The potential life of the gas sales project could easily exceed a 35-year life for a 4.5-billion-cubic-feet-per-day rate by many years if the potential of Alaska North Slope gas resources is realized."

A gas pipeline and startup of the Point Thomson field would boost North Slope oil production, but extending the life of the oil pipeline would require new oil-field development, the report says.

The Slope does not have the density of oil wells typical of "mature petroleum provinces." Before a possible gas pipeline is finished in about a decade, new exploration in the Central North Slope, National Petroleum Reserve-Alaska and Beaufort Sea could add 2.9 billion barrels of recoverable oil to known resources. Exploration in these areas and in the Brooks Range foothills could discover 12 tcf of natural gas, the report said.

LONGER TERM

The report's longer-term forecast is based on the optimistic assumptions that include adequate oil and gas prices, unrestricted land access, and stable government fiscal policies.

Given these assumptions, exploration and development onshore and in nearshore waters, but excluding the Arctic National Wildlife Refuge coastal plain, could add another 9 billion to 10 billion barrels to oil reserves, the report says.

Completion of a gas pipeline could enable 65 trillion cubic feet of natural gas to come online, while also encouraging new oil development and pushing the oil reserves to 15 billion to 16 billion barrels.

Further exploration and development on the Beaufort Sea outer continental shelf might push the recoverable oil resources to 19 billion to 20 billion barrels, and recoverable natural gas to 85 tcf, while addition of the Chukchi Sea could perhaps boost those figures to 29 billion to 30 billion barrels of oil and 135 tcf of gas, the report said.

SURPASSING NORTH SLOPE

In fact, taking into account new reserves developed in existing fields and assuming that exploration proceeds in more remote areas -- in the Chukchi Sea and perhaps in the ANWR -- a total of 35 billion to 36 billion barrels of oil and 137 trillion cubic feet of natural gas might ultimately be added to reserves by 2050, with those oil reserves additions amounting to more than twice the cumulative North Slope production so far, the report says.

The exploration of the coastal plain area of ANWR would be especially valuable in boosting oil reserves, because the estimated ANWR undiscovered oil resource of 10.3 billion barrels relates to a land area of just 1.9 million acres, the report said.