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Nikaitchuq Schrader Bluff PA expansion
Division of O&G approves 974-acre addition to participating area; two 2022 wells already partially producing from expansion area
Kristen Nelson
The Alaska Department of Natural Resources' Division of Oil and Gas has approved an application from Eni US Operating for an expansion of the Schrader Bluff participating area at Eni- s Nikaitchuq unit on the North Slope.
With the addition, the Schrader Bluff PA will consist of some 18,020 acres, division Director Dere kNottingham
said in the Oct. 23 approval. Alaska Oil and Gas Conservation Commission data for September, the most recent available, show all Nikaitchuq crude oil production, averaging 13,930 barrels per day in that month, is from the Schrader Bluff formation.
The division said this is the second expansion of the Schrader Bluff PA at Nikaitchuq. The unit was formed effective April 29, 2004, with the initial Schrader Bluff PA approved effective Jan. 1, 2011, and sustained production began Jan. 31, 2011.
Eni has completed 34 producing wells, 30 additional lateral wellbores and 25 injectors, with production from the Spy Island Drillsite and the Oliktok Point Pad, with full development of the Schrader Bluff OA sands to consist of 33 producers and 26 injectors, with potential for more wells.
All production is handled at the Oliktok Point Pad. The division said Eni has a purchase and sale agreement with Hilcorp Alaska for the Nikaitchuq and Oooguruk units, with the sale anticipated to close in the fourth quarter of this year. Schrader Bluff PA The division said the Schrader Bluff formation was discovered with the Nikaitchuq 1 exploration well in 2004,
with the commercial extent of the formation delineated with the Nikaitchuq 2, Tuvaaq St 1, Kingun 1, Nikaitchuq 3 and Nikaitchuq 4 wells.
Eni had acquired 100% working interest in the Nikaitchuq unit by 2007 and drilled the Oliktok Point 1-1 and 1-2 exploration wells to test horizontal development, with development drilling beginning in 2008 and first production in 2011.
The PA was formed in 2011 and first expanded in 2016.
The division said two recent wells drilled by Eni in the northeastern area of the unit, Nikaitchuq SP42-NE4 and Nikaitchuq SP40-E4 were drilled and produced outside the current Schrader Bluff PA "and therefore production dictates expansion of the Participating Area." The first well drilled outside the existing PA began commercial production in July 2022, so the expansion date of the Schrader Bluff PA "is effective retroactively to July 1, 2022," the division said.
Because the proposed "expansion area is already producing or contributing to production," there will be no additional economic benefit to the state, the division said.
The expansion area is along the northeastern edge of the existing Schrader Bluff PA.
The expansion area includes "all quarter-quarter sections within a 1,200-foot radius of the wellbores open to production/injection from the proven Schrader Bluff Oa reservoir," the division said, with the 1,200-foot based on injector-producer pair spacing. Development plans The division said it approved the 17th plan of development for Nikaitchuq Aug. 22, with Eni committing to drill three new wells and one lateral on the Spy Island Drillsite. In addition, Eni will do necessary maintenance and inspections, complete fabrication of the new Oliktok Point Pad control room and receive a stage gate review of the electrical power sharing project which would connect Nikaitchuq and Oooguruk unit power.
If the sale to Hilcorp is finalized, the division said, then the Eni work commitments will be subject to approval by Hilcorp, which will be allowed time to review and evaluate projects. l
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