The CD-5 project, a satellite oil pool west of the Alpine field, is delayed for at least a year because of delays in receiving a U.S. Army Corps of Engineers permit for a bridge crossing the Colville River, according to Helene Harding, ConocoPhlllip's vice president for North Slope operations and development.

The 1,405-foot bridge spans a channel of the Colville River and is needed for road access to the planned CD-5 drill site. Had it gone forward, construction of the bridge and drill pad would have employed about 400 next winter.

Harding said all permits are in place for the bridge except the U.S. Army Corps of Engineers Section 404 permit. The permit, the final one for the project, is needed so engineering and procurement of long lead-time equipment for the project can be done this winter, she said.

Gov. Sean Parnell strongly criticized the Corps for holding up the permit.

"This (inaction) kills more jobs and diminishes opportunities at a time when Alaskans, indeed all Americans, could use some good news on the job front," Parnell said in a written statement.

In the last six months, the state has fought the federal government on limitations to outer continental shelf leasing, changes to the Endangered Species Act listings and critical habitat area designations, Parnell said.

"Now they have delayed by another year Conoco and Anadarko's permit to build out CD-5 at Alpine," he said.

Corps of Engineers officials said they are working as fast as possible.

"We are finalizing our evaluation of the permit application in the most thorough and expeditious manner possible, while adhering to federal regulations and requirements," Corps spokeswoman Pat Richardson said in a statement. "In meeting our commitment to balancing development with the protection of water resources, all practicable alternatives must be examined before making a permit decision."

The original schedule was for engineering on both the bridge and the drill site to be done this winter and for construction to begin next winter. The plan was for CD-5 to be in production in 2012, Harding said. The schedule will now slip at least a year.

Getting the new satellites into production as fast as possible is important for sustaining the Alpine field, which is past its peak and in decline. With production from the main Alpine reservoirs declining, about half the oil the field now produced comes from satellite oil accumulations.

It becomes more difficult to process new oil in the processing facilities when new satellites are delayed, Harding said.

"The more Alpine declines, the harder it is. At lower volumes there are more problems with handling gas and water," that comes up the producing wells mixed with oil, she said.

CD-5 is about six miles west of the producing Alpine field, and is expected to produce between 12,000 and 18,000 barrels per day at peak production.

The proposed bridge is at the National Petroleum Reserve-Alaska border, making it the first commercial production from the federal reserve, if it is approved. Although the drill site will be on federal NPR-A leases, the state of Alaska will receive tax revenue and 50 percent of oil production royalties under current federal law.

Also, CD-5 development is part of a long-term plan to develop two drill sites farther west in NPR-A, so the delay pushes those projects into the future as well, Harding said.

ConocoPhillips submitted its first permit applications for the bridge in 2005, following completion of a federal environmental impact statement covering development of several satellite oil projects to the Alpine field, including CD-5.

Harding said the project has a long history. Nuiqsut, a nearby Inupiat village, objected to the original bridge location that was specified in the 2005 permit applications because it was in an area the villagers used for fishing.

It took three years, but ConocoPhillips finally worked out an agreement with Nuiqsut, announced in spring 2009, which involved moving the bridge to a site preferred by the village and building a short road link to the village.

The revised plan and new bridge location was resubmitted to federal agencies.

"We had the full support of the state, the North Slope Borough and the city of Nuiqsut and the village corporation, Kuukpik Corp.," Harding said.

Since last year, the company has spent a lot of time with letters back and forth to the Corps and with the U.S. Environmental Protection Agency.

According to letters it had written, the EPA is unhappy with the bridge idea and has said that it would prefer that ConocoPhillips bore an underground tunnel for the pipeline below the river to reduce surface impacts. If the Corps were to issue the permit, the EPA would "elevate" the decision formally, delaying the permit. To date, the Corps has taken no action, Harding said.

ConocoPhillips has problems with the underground crossing and prefers the bridge so that it has year-round road access to drill sites farther west. That's important, Harding said, because oil service equipment and supplies can be kept in a central location at the Alpine field and the companies won't have to build duplicate support facilities farther west.

Not only is that more efficient, but it also minimizes environmental impacts because there would be less surface lands in NPR-A affected, Harding said.

ConocoPhillips did build an underground pipeline crossing for the main Alpine pipeline when it first developed the field in 1999, but that pipeline handles processed crude oil and not the raw, unprocessed mixture of oil, gas and water that would flow from CD-5 to the oil and gas processing plants in the central Alpine field.

This mixture of fluids are more corrosive than processed crude oil, and ConocoPhillips wants the flow to be through above-ground pipelines, on the bridge, to make inspection and corrosion-monitoring easier, Harding said.

The CD-5 project and the two drill sites farther west are planned for development by ConocoPhillips and its partner, Anadarko Petroleum Corp. Satellites are oil accumulations near larger producing fields where the infrastructure of the larger field, such as oil and gas processing facilities, are used to support the satellite.

Tim Bradner can be reached at tim.bradner.@alaskajournal.com.