Balcony Natural Resources Inc. has told Petroleum News that it has obtained very promising results from the reprocessing of seismic data for its Grey Owl prospect, in the eastern North Slope nearly 30 miles south of the Badami oil field. The company says that it anticipates drilling a well in the prospect in the winter of 2022-2023 and is seeking a partner for the drilling.
On Dec. 21 Alaska’s Division of Oil and Gas issued a notice that it was granting a lease rental reduction for the last three years of Balcony’s state leases that include the Grey Owl prospect. Balcony acquired the leases from Borealis Alaska Oil earlier this year and wants to drill an exploration well in the Grey Owl prospect in the leases. Balcony has told Petroleum News that it has obtained very promising results from the reprocessing of seismic data for the leased area.
The 10-year leases originally became effective on March 1, 2014, with annual rentals of $10 per acre for the first seven years and $250 per acre in the remaining three years. Per the terms of the leases, the division could reduce the rental rate for those last three years to $10 per acre if the leaseholder had exercised reasonable diligence in exploring and developing the leases. The division said that Balcony had shown reasonable diligence by reprocessing 2D seismic data for the leases and conducting additional studies and mapping.
Promising results
In a Dec. 23 email to Petroleum News David Pfeiffer, Balcony chief financial officer, expressed his optimism about the Grey Owl prospect.
“We are very excited about the results from the technical work that has been done to date,” Pfeiffer wrote. “We are eager to move forward.”
Pfeiffer said that his company is exploring funding strategies for drilling an exploration well and anticipates seeking a strategic partner for the project.
The Grey Owl well that the company wants to drill would be near the site of the West Kavik well that was completed in 1970, Richard Garrard, technical advisor for Balcony, has told Petroleum News. The target is light oil in Brookian sands, somewhat analogous to the major Nanushuk discoveries in the western North Slope.
The Brookian sediments were deposited in an ancient marine basin that progressively filled from the west. Because of this filling mechanism the sediments tend to become progressively younger towards the east, although they were all deposited in a somewhat similar geologic setting. The primary target at Grey Owl is in the Canning formation, a Brookian rock formation that is younger than the Nanushuk. The West Kavik well found multiple light oil shows in the Canning, Garrard said.
Seismic reprocessing
Garrard said that recent seismic reprocessing that Balcony commissioned from WesternGeco had revealed some exciting new evidence regarding the Grey Owl prospect. For the first time the reprocessed seismic has been able to image the light oil bearing reservoirs discovered by the West Kavik well, with some further processing revealing a previously unidentified prospect in the base of the Sagavanirktok formation, immediately above the Canning.
The seismic data analysis has indicated the presence of sands encased in shale, thus showing the presence of viable hydrocarbon traps in a situation analogous to the Nanushuk to the west, Garrard said.
It appears that the Canning sands were deposited deeper down the side of the ancient marine basin than the Nanushuk sands, which were deposited across the edge of the basin margin. But mapping the Canning sands using the seismic data indicates that the sands are on the side slope of the basin, rather than the basin floor, Garrard said. The Sagavanirktok prospect appears to be in sands deposited in a basin edge situation closely resembling the Nanushuk. And further studies by Agile Seismic of the seismic amplitude variations with seismic recorder offsets indicates that the Sagavanirktok prospect may be associated with porous sandstones holding stratigraphically trapped light hydrocarbons.
The recovery of light oil from the West Kavik well indicates oil saturated sands over an interval of about 6,000 feet, Garrard said.
Field studies
Summer field studies conducted this year investigated potential drilling sites, evaluating factors such as water availability and determining that there are no cultural resources that would be impacted by a drilling project. The field studies also included a drone survey of the West Kavik gravel pad and airstrip, as a potential source of gravel for future development drilling.
Balcony also commissioned a study into the logistics and costs of drilling an exploration well to a depth of about 11,500 feet, to evaluate the light oil bearing Canning reservoirs.
Previous studies included an initial interpretation and mapping of the prospect, a study of cuttings from the West Kavik well, and well test modeling.
A development option for Grey Owl could presumably involve connection to the existing oil field infrastructure and pipeline system at the Badami field to the north.
