Work will proceed on Caelus Energy Alaska's Nuna project in anticipation of project sanction, according to the company's latest plan of development for the Oooguruk field, offshore the North Slope. The plan, which covers the period Aug. 31 to Aug. 30, 2015, and was filed with Alaska's Division of Oil and Gas on June 2, says that work will continue on onshore drill sites, roads and flowline designs, and on the integration of the Nuna development with existing Oooguruk and Kuparuk River unit facilities.
During the period of the new plan Caelus will "integrate the results from drilling, engineering and permitting into determining the commercial viability of the Nuna onshore development," the plan says.
Nuna involves the construction of a new onshore gravel well pad, drilling multiple new wells from the pad and hooking the new production into an existing onshore tie-in between Oooguruk and the neighboring Kuparuk field infrastructure.
In April Jim Musselman, Caelus president and CEO, told Petroleum News that Caelus was engaged in activities such as engineering for Nuna and planned to start laying gravel and doing other site work in the fall.
"We've got the funds committed and we're moving forward as quickly as we can," Musselman said.
Caelus has estimated a total development and drilling cost of around $1.4 billion for the project, with the possibility of first oil flowing in the third quarter of 2016.
Online in 2008
The Oooguruk field, which came online in 2008, has production facilities on an artificial gravel island in the nearshore waters of the Beaufort Sea. Pioneer Natural Resources Alaska developed the field but has sold the field to Caelus, with a sale completion date of April 15.
The field has three distinct oil reservoirs at different levels in the subsurface: the Nuiqsut, the Kuparuk and the Torok. Initial production focused on the Kuparuk and the Nuiqsut. Some production from the Torok started in 2010. But, with the Torok, the shallowest of the reservoirs, extending well south of the production island, full development of this reservoir requires an onshore well pad. The Nuna project targets the Torok, with the onshore pad a key element of the project design.
In its new plan of operations, the first that it has filed as field operator, Caelus said that Pioneer had already conducted some activities in preparation for the Nuna development, including some environmental studies and conceptual engineering. Pioneer also added three leases to the Oooguruk unit, the plan says.
The plan also says that in the past year Pioneer had completed a number of upgrades to the existing field facilities, including the installation of new lift gas heating capacity; the replacement of some pipelines in the drilling mud system; and the installation of a new supply line for water injection for well fracture stimulations. Maintenance activities included "smart pigging" of some oil and water flowlines; replacement of worn piping and valves; and general mechanical integrity inspection of piping and safety systems. Pioneer also directed engineering activities aimed at optimizing processes, including produced water handling and the supply of injection water, the plan says.
Well remediation work has included the repair of electric submersible pumps and the maintenance of a disposal well.
In terms of field reservoir management in the past year, Pioneer expanded operations involving the injection of water into the Nuiqsut while continuing the injection of gas for enhanced oil production from the reservoir, the plan says. Similar operations were started in the Torok reservoir. Waterflood was used in the Kuparuk reservoir, using two primary injection wells and with strong performances from two horizontal production wells. Another Kuparuk production well, the first to go into operation when the field started up, has been shut in because of issues relating to water production, the plan says.
A program designed to trace the passage of water in the reservoir, enabling the evaluation of options for improved oil recovery using waterflood, continues in the Kuparuk, the plan says.
Continuing development in the Nuiqsut is focusing on horizontal drilling in a fault block in the northwestern portion of the reservoir, although a well was also drilled to the southwest. Four wells drilled during the winter of 2014 were hydraulically fracture-stimulated and have recently demonstrated the highest initial oil flow rates yet seen in the Nuiqsut, the plan says. A new injection well was completed in the northwestern fault block. And stimulation of four existing injection wells improved their performances.
Some production and injection surveillance work was conducted in Nuiqsut wells. Updates to reservoir simulation models will assist in reservoir management, the plan says.
In the portion of the Torok accessed from the Oooguruk island, production continues from two horizontal fracture-stimulated wells, while a third production well has been shut in for repair. One injection well is performing effectively, while a second injector had to be shut in to accommodate a drilling operation, the plan says.
Five wells planned
Caelus anticipates drilling five new Nuiqsut horizontal wells during the 12-month duration of the new plan, the plan says. No new wells are planned on the production island for the other reservoirs, although there may be five well recompletions. One of the new Nuiqsut wells will target the southwestern part of the reservoir, two will be sidetracks to existing wells, one will be an injection well and one will be an appraisal well in the southern part of the reservoir.
Caelus says that it also anticipates further optimization of the waterflood operations in the Kuparuk reservoir; an expansion of the enhanced oil recovery operation in the Nuiqsut; and continuing enhancement of oil recovery in the Torok.
But, although gas injection is desirable for enhanced oil recovery in both the Nuiqsut and the Torok, only limited volumes of gas are available for this purpose, with the availability of gas being dependent on the acquisition of an adequate gas supply from a third party, the plan says.
Caelus says that it anticipates using a planned field shutdown in September to make some minor facility upgrades. Additional maintenance work during the period of the new plan will include some further pigging of a water flowline. And Caelus will continue to endeavor to optimize production and water injection operations, the plan says.
Caelus also plans to continue geologic and geophysical analyses to assess development opportunities in acreage outside current development areas and at various geologic horizons, the plan says.
This story originally appeared in Petroleum News and has been republished here with permission.