Drilling rig shortage delays North Slope work

A shortage of available drilling rigs on the North Slope has caused some explorers to delay their work this winter, sources in industry and state officials say.

Linc Energy and Great Bear Petroleum, two independents, have rescheduled test wells they planned because of difficulties in securing rigs. Linc Energy spokeswoman Colleen Richards said her company’s plan to drill in Umiat, in the southeast National Petroleum Reserve-Alaska, is now set for the winter of 2012-2013.

Problems in securing a suitable rig was a factor in the delay, Richards said.

Great Bear Petroleum has rescheduled its plan to test the oil-production potential of shale rocks on the Slope, original planned for January, until later in the spring, state Oil and Gas Director Bill Barron said in a recent briefing for state legislators.

Repsol Inc. is meanwhile continuing its ambitious plan to drill test wells at several locations on the Slope this winter, but has scaled its plan from to test five prospects to four  because of difficulties in securing permits at the fifth well site. Repsol will also be using only three rigs instead of five, according to state officials familiar with the company’s plans.

Some of Repsol’s wells are offshore in shallow waters of the Beaufort Sea, where drilling will be done from an artificial ice island. The other prospects being tested are onshore locations. Repsol is building about 60 miles of ice and snow roads to move its rigs and other equipment. The ice roads are nearing completion, according to Melissa Head, permits manager for the state Division of Land and Water Management. Repsol could not be reached for comment.

Two other firms are proceeding with exploration as planned. Brooks Range Petroleum, an Alaska-based independent, will test its North Tarn discovery made late last spring west of the Kuparuk River field and drill at one other prospect. A four-mile ice road built by Brooks Range is complete and is in use.

Savant Resources, a Denver-based independent, plans new drilling at the small Badami field east of Prudhoe Bay. A 25-mile ice road from Prudhoe Bay to the site is near completion.

Savant will redrill wells originally drilled at Badami by BP to increase output, and will drill one new exploration well, according to state officials familiar with the company’s plans.

Anadarko Petroleum is also nearing completion of a 50-mile snow road to reach an exploration prospect in the southern North Slope, where the company drilled an exploration well two years ago. A discovery was made, but Anadarko was not able to test the productivity of the well. Those tests are now planned this winter.

Anadarko also holds lease rights at the Gubik gas field, a small gas field also on the southern North Slope. The company has drilled evaluation wells at Gubik and conducted flow tests of gas, but has not released results.

Both gas prospects are on private lands owned by Arctic Slope Regional Corp., an Alaska Native-owned development corporation based in Barrow.

Great Bear’s plan to test the shale source rocks of the slope for oil production potential has attracted a great deal of interest. Unlike other Slope explorers, Great Bear’s six initial sites are on gravel pads adjacent to the Dalton Highway, a state road, which means a rig can be moved to the site late in the spring after other exploration is finished.

Almost all exploration on the Slope is done in winter and early spring when cold temperatures allow construction of ice roads and overland surface movement on the tundra, which is frozen at that time of year.

Great Bear’s drilling can be done later because its test locations can be reached from the Dalton Highway.