Free Republic

Energy company investments in Alaska could reverse declining oil production in the state. Firms are planning the largest energy project in the state’s history along with a series of moves to rejuvenate Alaska’s biggest oil fields. That is unless, the companies are saying, voters in the state in August dismantle a new oil tax regime that Houston-based ConocoPhillips and others say makes Alaska far more attractive than it was under higher levies imposed in 2007. In a story at HoustonChronicle.com, FuelFix reporter Collin Eaton takes a look at the energy projects that area planned and issues surrounding the tax vote.

As political shenanigans continue to delay approval of the Keystone XL pipeline, Alaskan voters hold the key to avoiding a similar fate for what could be North America’s largest pipeline project. At an estimated cost of at least $45 billion, the Alaskan LNG natural gas pipeline project will deliver jobs and provide a boost to the economy in towns and villages all along the 800-mile route stretching from the North Slope to the Kenai Peninsula. After decades of talking about how to tap into the vast gas resources on Alaska’s North Slope, this project is poised to make that reality....

A flowline to a well operated by BP Exploration, Incorporated Prudhoe Bay leaked on Monday. High winds at Prudhoe Bay have resulted in a spray of natural gas, crude oil and water that covers an area larger than 20 football fields. According to the Alaska Department of Environmental Conservation, operators with BP were working at a well, when a flowline leaking. Ashley Adamczak is an Environmental Program Specialist with DEC. She says 30-mile-an-hour winds on the North Slope sprayed leaking natural gas, water and crude oil across an estimated 27 acres of snow-covered tundra. “What has not been delineated at...

BP is selling off stakes in four Alaskan oil fields near the gigantic Prudhoe Bay, a move that would cut about 15 percent of its crude production in the state, the company said late Tuesday. The British oil company did not disclose the price it would get from Hilcorp, a private Houston-based oil producer that has been jockeying for Alaska’s natural gas basins. In the deal, which is expected to close by the end of the year, Hilcorp would receive all of BP’s interest in the offshore Endicott and Northstar fields and half of its stakes in the Milne Point...

...began my professional career in atmospheric science on the icy shores of the Chukchi Sea — 160 miles above the Arctic Circle. I was hired by the RCA Service Co. to be a civilian weather observer at a lonely Air Force base in Cape Lisburne, Alaska. ...I long to see this truly wild and wonderful state continue to prosper as not just a terrific employment or tourist destination, but as an even bigger energy lifeline to the lower 48, as well. Alaska’s frozen frontier of spectacular natural beauty is also home to copious energy reserves. Americans should enjoy the grand...

U.S. Department of Energy (DOE) Secretary Steven Chu contributed a statement to an announced breakthrough in research into tapping the vast fuel resource of methane hydrates that could eventually bolster already massive U.S. natural gas reserves.As Al Fin pointed out yesterday natural gas is priced to a barrel of oil equivalent at about $10-$11 per the estimable Geoffrey Styles view, something less than 10% of the cost of oil. For North Americans adding a viable and hopefully low cost means to make use of gas hydrates could be giant boost to low cost fuel sources and a massive kick to...

In June 2012, BP Exploration (Alaska) Inc. made the startling announcement that it was dropping its ambitious plan to develop the offshore Liberty field using ultra extended-reach drilling from shore. In the 15 months since, it has been less than clear what alternate approach, if any, BP might take on Liberty. But now, the company’s direction is becoming evident. On the U.S. Bureau of Ocean Energy Management website devoted to Liberty, this statement has appeared: “BP Exploration (Alaska) is now proposing a stand-alone drilling and production processing island as the safest and most environmentally responsible course of development for the...

Alaska Gov. Sean Parnell’s open-ANWR strategy isn’t working, at least not so far. The Obama administration has again turned back a Parnell proposal to conduct exploratory activity on the coastal plain of the Arctic National Wildlife Refuge. The Republican governor had submitted, on July 9, an application to the Interior Department for a “special use permit” allowing the state to conduct 3-D seismic surveys across the coastal plain from 2014 to 2017. On July 26, the governor’s office released a July 23 rejection letter from Geoffrey Haskett, Alaska regional director for the U.S. Fish and Wildlife Service, which manages ANWR....

ConocoPhillips octolateral well accesses oil pockets in maturing Kuparuk field In the early days of developing the huge Kuparuk River field on Alaska’s North Slope, producing oil involved drilling steeply inclined oil wells through a series of prolific reservoir sands. Now, with the easy oil gone but much oil still remaining underground, field operator ConocoPhillips is using ever more challenging techniques to access remaining pockets of oil in the field’s complex and fragmented system of reservoir sands. The company recently drilled an octolateral well — a well with eight horizontal wells originating from a single near-vertical well bore — as...

BP is set to announce Monday that it will sink $1 billion into revving up crude production from Alaska’s declining North Slope, weeks after the state decided to give the oil industry a $750 million annual tax cut. The British oil giant plans to add two drilling rigs to its Prudhoe Bay field, bringing the count up to nine, the highest in about six years. New well work and drilling, along with upgrades of existing facilities, could support 200 new jobs, the company said. Separately, with the agreement of its working interest partners at Prudhoe Bay, including ConocoPhillips and Exxon...

House Republicans on Wednesday took one of the first steps toward overturning a new Obama administration plan for managing wildlife and oil development in the 23-million-acre National Petroleum Reserve-Alaska. During a House subcommittee hearing on a bill to repeal the reserve management plan, Republicans insisted the administration’s blueprint tilts too heavily toward conservation by walling off energy development in roughly half of the reserve. “The Obama administration appears determined, against the wishes of most Alaskans, to keep their energy resources off limits,” said Rep. Doc Hastings, R-Wash. who sponsored the repeal bill along with Rep. Don Young, R-Alaska. Finalized by...

State, ConocoPhillips, ASRC join defense of permit for first NPR-A development - - - - Quite a legal battle is shaping up over the expansion of oil and gas development into Alaska’s western North Slope frontier. The conflict centers on a planned project known as Colville Delta 5. ConocoPhillips Alaska Inc. has a federal permit to build and operate the CD-5 drill site inside the National Petroleum Reserve-Alaska. Seven residents of Nuiqsut, a predominantly Inupiat Eskimo village a few miles southeast of CD-5, are suing in Anchorage federal court to invalidate the permit issued by the U.S. Army Corps of...

The Alaska Senate on Sunday afternoon approved the oil-tax bill that passed the House 13 hours before, sending to Gov. Sean Parnell the measure he had sought to save billions of dollars for Alaska's leading industry. The Senate vote was 12-8 to concur with the revised bill that the House approved 24-15 just before 2 a.m. Sunday morning (on reconsideration, three Republicans switched to support the bill). The Senate vote came past the midway point of the 90th day of the 90-day session. Parnell said that Alaska's current tax regime, which he backed as lieutenant governor in 2007 when it...

After focusing for years on adding heat to the chilly contents of the trans-Alaska oil pipeline, officials are planning to study a new approach to boosting line performance — decreasing the amount of water inside. With North Slope oil production in a 25-year-long decline, the pipeline is becoming more vulnerable to problems as the flow of crude decreases. A barrel of oil took just four days to travel the length of the 800-mile line in 1988, but now takes 18 days. Because of the slower flow rate, the temperature of oil can sometimes dip down to 32 degrees during its...

The Senate completed passage of the governor's oil-tax revamp Thursday, confirming its original 11-9 vote on reconsideration. After all the drama Wednesday -- a session that spanned nine hours and featured long debates on amendments and then on Senate Bill 21 itself -- only one senator asked for debate time Wednesday. "I read that I spoke for about 40 minutes last night," said Sen. Bill Wielechowski, D-Anchorage, an opponent of the bill. "I won't put you through that again today, but this bill pushes about $2,000 a minute across to the oil industry, every minute of the day for the...

After dedicating nearly eight years and $5 billion to the quest, Shell’s plans to continue hunting for Arctic oil this summer are in jeopardy, as company officials on Monday confirmed they will tow two drilling units to Asian dry docks for repairs. Although Shell Oil said the firm has not ruled out drilling in the Chukchi and Beaufort seas north of Alaska this summer, it appears unlikely the vessels will be able to make the two-to-four-week treks to those Asian ports, undergo repairs, clear U.S. inspections and return to those Arctic waters in time for the drilling season that begins...

An executive with BP Alaska says the company plans to add two new rigs on the North Slope this year. But Phil Cochrane says the company won't search for or produce new sources of oil. In prepared remarks to an Alaska Support Industry Alliance conference in Anchorage, Cochrane said the rigs will be used to accelerate production from existing reserves. He said it's a response to a state policy that discourages investment.

In the wee hours of New Year’s Day, the U.S. Senate approved a hard-fought deal to stave off the dreaded “fiscal cliff.” But that wasn’t the only order of business for the bleary-eyed senators. They also passed, by unanimous consent, a bill that someday could prove an important piece of a plan to bring energy security to Southcentral Alaska. The bill (S. 302) would allow for construction of a natural gas pipeline through Denali National Park and Preserve. The planned pipeline would run 737 miles overall, from the rich gas fields of the North Slope to the area of Anchorage...

Even if Shell is able to free its grounded Kulluk drilling rig from a rocky Alaskan island shore, it may be too damaged to resume hunting Arctic oil this summer. The 29-year-old conical drilling unit is uniquely designed to weather floating ice, and replacements aren’t readily available. Even if Shell Oil Co. could find an Arctic-ready rig, it almost certainly would not secure air pollution permits for a different vessel in time to resume drilling wells this July. “These are very specialized rigs,” noted Dave Pursell, managing director of the Houston-based energy investment bank Tudor Pickering Holt & Co. “If...

The grounding of Shell’s Kulluk drilling rig amid a fierce storm in the Gulf of Alaska raised the specter of a fuel spill in the region and provided fresh fodder to drilling foes who insist Arctic oil exploration is too risky to allow. The episode also cast doubt on whether Shell Oil Co. will be able to resume its hunt for Arctic oil this year. The 29-year-old Kulluk conical drilling unit was unmanned when it plowed into rocks on the southeast side of Sitkalidak Island Monday night in Alaska, and there were no major injuries. But Coast Guard and Shell...