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Producers 2024: Glacier maintains Cook Inlet properties, ponders expansion West McArthur and Redoubt remain viable but future may depend on exploration
Eric Lidji for Petroleum News
Earlier this year, the state officially approved a major ownership shuffle involving Glacier Oil & Gas Co. and its two subsidiaries: Cook Inlet Energy and Savant Alaska.
Under the plan approved by the Division of Oil and Gas, SEP Alaska LLC transferred some of its 100% interest in Glacier to The Smith Bay Company Alaska Inc. and JPD Family Holdings LLC. Glacier owns 100% interest in Cook Inlet Energy, which owns 100% interest in Savant Alaska. Under the new proposal, Cook Inlet Energy and Savant Alaska retained their existing working interest in 15 state leases.
Pontem Energy and Sweat Equity Partners acquired Glacier Oil & Gas in early 2023, picking up 100% working interest in the Cook Inlet Energy LLC-operated West McArthur River unit, Redoubt unit and associated Kustatan Production Facility in Cook Inlet as well as the Savant-operated Badami unit on the eastern North Slope.
(Editor's note: See update on Badami in the North Slope section of The Producers.)
As with other smaller fields throughout the Cook Inlet basin, Cook Inlet Energy is balancing practical and relatively affordable projects with a desire for new drilling at the West McArthur River unit and the Redoubt unit. The company is reporting significant increases at the West McArthur River and a significant decline at the Redoubt unit.
West McArthur River The state formed the West McArthur River unit in 1990. Cook Inlet Energy assumed operatorship in 2009. The unit has 6,970 acres over parts of three offshore leases.
West McArthur River includes two participating areas: Area No. 1 and Sword.
The West McArthur River unit has eight wells. The unit produces from WMRU-2B, WMRU-5, WMRU-6 and Sword No. 1, producing 55.8 million cubic feet of natural gas, 230,992 barrels of oil, and 1.7 million barrels of water in calendar year 2023, according to the company. This represents a 138% increase in production over the prior year.
WMRU-4D is a Class I disposal well, currently online. The WMRU-1A and WMRU-7A producers have been shut-in since late 2010 and late 2012, respectively, due to failed jet pumps. The WMRU-8 disposal well was taken offline in August 2023 pending work.
Redoubt The state formed the Redoubt unit in 1997. Cook Inlet Energy assumed operatorship in 2009. The unit has 9,668.5 acres over parts of five offshore leases. Redoubt has one participating area: Hemlock. A proposed contraction of the unit is under consideration.
The Redoubt unit has nine wells. The unit produces from RU-1A, RU-5B, and RU-7B, producing 40.9 million cubic feet of natural gas, 164,203 barrels of oil, and 142,747 barrels of water in calendar year 2023, a 47 percent decline over the previous year.
RU-3A and RU-6A are injectors. RU-D1 is a Class I disposal well. The RU-2A and RU-9 producers have been offline since 2023 and 2014, respectively, due to downhole issues. The RU-4A gas producer was suspended in 2014 due to water loading issues.
Acid Test In May 2023 ' at the start of its previous development year that ended April 2024 ' Cook Inlet Energy continued an acid stimulation project it had started the previous year.
The company conducted a pilot test on the WMRU-5 and WMRU-6 wells in June 2022 and the RU-2A well in December 2022 and reported that the test had 'proved beneficial to ESP pump performance by eliminating scale buildup from high water cuts and aided in enhancing production from the Hemlock formation' at West McArthur River.
A subsequent failure of an ESP at the RU-2A well, unrelated to the stimulation, kept the company from fully determining the impact of the project at Redoubt. A workover in July 2023 was abandoned 'after discovering that a major portion of the tubing and ESP assembly had parted in the hole,' requiring special intervention, possibly this year.
Following those positive results, the company conducted additional acid stimulation at the WMRU-2B and the Sword No. 1 wells, before working over both wells in May and June 2023 to replace failed electric submersible pumps. The new ESP at WMRU-2B stopped working after 18 days, requiring a second workover in September 2023 to replace a failed penetrator. The well was brought back online following that intervention.
Workovers A reservoir study at the Redoubt unit in March 2023 included a project to determine whether to convert the RU-5B producer into a water injection well, following an ESP failure. The company instead decided to replace the ESP in August 2023 and keep the well as a producer. Following the operation, the company conducted a weak acid stimulation in December 2023 to increase productivity. The results are being evaluated.
Following a failed ESP at the RU-7B well in May 2023, Cook Inlet Energy conducted an unplanned workover and acid stimulation in August. The company was unable to retrieve the failed pump but said the remaining pieces had no adverse impact on production. This work forced the company to defer some activities that had been planned for RU-9.
FWKO Cook Inlet Energy completed its Free Water Knock Out project in September 2023. The project was launched to simplify disposal at West McArthur River and Redoubt.
Before the project, the company processed produced water from both fields at the Kustatan Production facility and injected the waste at Redoubt. The FWKO project allows the company to extract produced water from the three-phase stream before it leaves West McArthur River for Kustatan, making it available for local uses at West McArthur River.
As part of a pilot project launched in December 2022 and carried into 2023, the company identified the shut-in WMRU-7A and WMRU-08 wells as candidates for injection.
Through the FWKO project, Cook Inlet Energy converted the WMRU-4D Class I disposal well to produced water disposal and is now considering the same for WMRU-08.
The company is working on a phased project to increase injections at RU-3A.
Cook Inlet Energy completed in-line inspection on its three-phase 8-inch pipeline connecting West McArthur River to Kustatan and now plans to replace 1 mile of the pipe. The company also discontinued Rig 37 after evaluating the unit for repairs. A substitute rig brought to the site is also being used at Redoubt instead of Rig 35.
Exploration projects Those are the maintenance projects. The bigger project at West McArthur River is the Sabre prospect. The bigger projects at Redoubt are the Northern and South fault blocks.
Several former operators looked at Sabre. Cook Inlet Energy considered a well as early as late 2013 but ultimately delayed the project due to logistics and costs. The company previously drilled the RU-9 well in the Southern fault block, but a failed electric submersible pump subsequently hampered the well. Cook Inlet Energy has continued to include both expansion projects in development plans over the year. Its 2023 plan cited 'capital constraints coupled with geologic and drilling risk' as well as the ownership change and a focus on Badami drilling as current reasons for deferring these projects.
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