The operator of the South Miluveach unit, Mustang Holding LLC, has an Oil Discharge Prevention and Contingency Plan under review by the Alaska Department of Environmental Conservation per a Dec. 27 ADEC notice. The proposed CPlan confirms that Mustang Holding and its new owner Finnex Operating LLC are moving forward with Finnex's plan to conduct a multi-year onshore oil and gas project year-round in the unit's Mustang field.
The Mustang Development targets the Kuparuk "C" sands, the same reservoir that is being produced in ConocoPhillips Alaska's Kuparuk River field. A maximum oil production rate is predicted to be 6,000 barrels per day, with total expected recovery approximately 25 million barrels of oil over field life of 30 years.
Drillsite design will allow for up to 38 wells on a minimum of 15-foot well centers.
The Southern Miluveach unit, or SMU, lies between the Kuparuk River and Colville River units on Alaska's North Slope. The Mustang field, originally developed by Brooks Range Petroleum Corp., produced for just one month, a total of 10,999 barrels in October 2019, according to Alaska Oil and Gas Conservation Commission records.
The Mustang Development area is adjacent to the western boundary of the Kuparuk River unit and is approximately 4.5 miles west of existing KRU Drill Site 2M.
Mustang Holding was a wholly owned subsidiary of the Alaska Industrial Development & Export Authority. AIDEA's board voted to authorize the agency's executive director and staff to finalize an agreement with Finnex Operating LLC for the sale of AIDEA's interest in Mustang.
The resolution was approved unanimously by the board Sept. 21. Executive Director Randy Ruaro told the board the agreement would be finalized within 30 days.
Gordon Pospisil, president and CEO of both Finnex and of Mustang Holding, said Finnex will become unit operator and return the unit to production and reconnect the Mustang pipeline.
Of four wells drilled at the Mustang Pad, Pospisil said one is producible in paying quantities.
During construction 120 jobs are expected, he said, with 10 to 20 permanent jobs at the field.
Ties into Alpine line
The Mustang Pad was described in the proposed CPlan as a 17-acre gravel production pad, located off of Mustang Road, a 5-mile spur road beginning at the Kuparuk River unit's DS 2M Pad. Associated facilities to support Finnex's project include wellhead facilities, on-pad and off-pad piping/manifolds, process facilities, and a trucking terminal.
After the 1,150-foot Mustang pipeline is reconnected, crude oil will be pumped from storage tanks into the Alpine Transportation Co. common-carrier pipeline just southeast of Mustang Pad.
Shared wellbores, use of horizontal drilling technology, and long-reach wells will maximize production while minimizing surface impacts.
Process facilities on Mustang Pad include all facilities and utilities necessary to separate oil, water, and gas, and produce a crude oil product stream that meets the quality specifications of TAPS, the Trans-Alaska Pipeline System.
Mustang Pad process facilities are currently designed to handle peak rates up to 5,000 barrels of oil per day, along with associated gas and water, for a peak fluid (oil + water) capacity design of 7,500 barrels of fluid per day. Produced gas is dehydrated, compressed and used for fuel gas. Excess gas beyond what is necessary to provide fuel gas is re-injected into the Kuparuk River reservoir.
The 38 wells will be enclosed in unheated well shelters. Surface safety valves with associated hydraulic control panels will be located in the well shelter.
Production and gas injection wells will also have sub-surface safety valves actuated with a hydraulic control panel that are within 660 feet of the on-site operations camp.
Allocation of producer well volumes will be accomplished using a Schlumberger 3-phase Vx meter to test individual wells in accordance with state regulations. In addition to central process facilities and the drill site facilities associated with the wells, the Mustang Development will also include support infrastructure (non-process) such as an operations camp for staff housing, maintenance and a control room.
During the construction phase, the site plan includes provision for a construction camp and a construction support complex.
