Ahtna Inc. is preparing for the start of drilling at its Tolsona No. 1 natural gas exploration well about 11.5 miles west of the town of Glennallen, the Native regional corporation for the Copper River region announced Aug. 10. Construction of a new 4-acre gravel drilling pad is complete, with the drilling rig scheduled to arrive on site by Sept. 1. Drilling is expected to start in mid-September and should be completed by late October.
The Native corporation had originally anticipated doing the drilling in the spring.
Ahtna says that uncertainty over the status of state oil and gas tax credits has proved challenging for the project. The extension of the credits for Alaska's "Middle Earth" region, including the Copper River basin, has made the drilling possible, the corporation says, presumably referencing tax legislation passed in the summer. The primary objective of the project is to find a source of gas for heating and power generation in a region where energy costs have become very high.
"Ahtna would not be doing this exploration if the tax credits were not in place. A substantial discovery would benefit not only the Copper River region but the state at large, helping to address high energy costs in the region and beyond," said Ahtna President Michelle Anderson.
Ahtna says that construction of the drilling pad and the access road to the nearby Glenn Highway involved the placement of more than 100,000 yards of gravel and more than 7,000 truck trips from a gravel pit over a 35-day period. The drilling rig is being mobilized for arrival at the pad in about 40 truckloads by the Sept. 1 date.
Target depth
The planned well, drilled in state land under the terms of a state exploration license, will target thick Nelchina sandstone intervals at depths between 4,000 and 5,000 feet. The drilling crew will conduct flow tests once the well has reached its target depth, Ahtna says.
The region is known to be gas prone. A previous gas exploration well, the Ahtna 1-19 well, drilled about 2 miles east of the Tolsona well between 2005 and 2007, encountered gas but eventually had to be abandoned because of exceptionally high formation pressures and problems with water encroachment.
Ahtna says that for the Tolsona well, the crew will use special equipment to separate and analyze fluids flowing from the well. Following demobilization of the rig toward the end of October, the well will be secured and a site cleanup performed.
Public access
Ahtna has previously indicated that, depending on whether the drilling pad becomes used for gas production following a significant gas find, the pad and access road may be made available for recreational access to the land on the north side of the Glenn Highway. The access road is currently open to the public, with a pullout and turnaround area at the security gate near the pad entrance. However, the corporation says that, in anticipation of heavy traffic, including trailers carrying the drilling rig, restrictions will be placed on road access to ensure the safety of both the public and the project work crew.
Alaska employment
Once the drilling is underway, Ahtna anticipates about 50 people, mostly from third-party contractors, to be working on the project at any given time. About 70 percent of the people who worked on the pad and road construction consisted of Ahtna Native shareholders and members of trade unions; all project staff, including subcontractors, are Alaskans, Ahtna says.
Ahtna sees local employment, in addition to the resource potential, as a benefit of the project.
"We hope to see an increase in local hire for this phase of the project and, taking a longer view, that if the potential resources are successful, we will see an increase in long-term jobs and employment opportunities with the region," Anderson said.
This story originally appeared in Petroleum News. It has been republished with permission.