North To Alaska!



The Cook Inlet Basin in SE Alaska was first poked around in as early as 1904 based on numerous bubbly, oil seeps in creeks in the Katalla area, south of Cordova. Gas was found as shallow as 300 feet below the surface and then deeper, around 1,200 feet, and almost 160K barrels of very high gravity distillate was eventually produced until the late 1930's A refinery was built, then burned to the ground in 1934; some years later all of Katalla was heaved upwards 10 feet and split in half from a massive earthquake.


Distillate and gas from Katalla helped keep lots of people warm during the winter and proved the Cook Inlet Basin was productive.

Katalla continued to receive attention to deeper targets thru the 1940's, as did the Kenai Peninsula, even as far south as the Iniskin Peninsula, on the west side of the Inlet. The basin appeared to be very gassy and no significant liquids production occurred.


































Summertime drilling in the Iniskin Peninsula, 1937




The first big discovery in Alaska was on the Kenai Peninsula, when Atlantic Richfield (Arco) hit pretty big in the Swanson River Field in 1957 in the Eocene Hemlock formation. By the early 1960's this field was making 35,000 BOPD.

A JV between Pan American, Sinclair, Skelly and Phillips 66 shot a bunch of 2D seismic on the west side of the Inlet and some rather large structures popped up in 40 to 100 feet of water. These structures were relatively shallow, in proven Tertiary rocks, and considered low hanging fruit, save for the harsh climate and difficult drilling conditions.


Water depth was not much of a problem in the Inlet...at low tide. I have been to the Cook Inlet several times, fished it, flown over, landed on it and drank whiskey up on the docks in Anchorage, in the north end of the Cook Inlet, and watched 35 feet of tide come in like a freight train; its amazing ! Sheet ice several feet thick has been clocked at 12 knots per hour on Cook Inlet tide movements. The water, by the way, will crack your teeth its so cold.


Pan American drilled its first well, the West Foreland No. 1 on land, or marsh, in 1961 and made a gas discovery in one fault block that IP'd for 16.5 MMCFGPD from the Tertiary, Kenai formation. This got everybody excited and Shell, Oxy and Union jumped in the fray on the west side of the inlet and drilled dry holes all over the place in 1961 and 1962. Standard of California found Eocene gas and a little oil in a field it called Beluga River, for the small white whales that breed in the Inlet, seen on the map above.

Pan American's next two prospects after West Foreland were in separate blocks but in water and required a sort of barge, shallow draft ship to explore these structures. The very first two wells Pan Am drilled in the water, starting 1961, were whopper blow outs.


The Middle Ground Shoals State 1 well blew out on June 4th or 5th, 1961, in a shallow gas sand. Pan Am was able to get control of that, set pipe across it, then the same well blew out again at 5,261 feet at the estimated rate of 28MMCFGPD. It broached the surface casing and made a crater 1000 feet wide several hundred feet from the rig. At low tide the crater could be seen, at high tide it would just gurgle gas. By the first week in July this well was finally pumped dead with sea water and mud, then plugged with thousands of sacks of cement. The controlling fault sealing the structure in Middle Ground had 11,000 feet of throw!


Pan America filed a new field discovery with the AOGCC naming this field the Middle Ground Shoals Field. In the hearing with the AOGCC it submitted evidence proving the structure of the field and estimated GIP in each of three shallow reservoirs within the structural confines.

Shell Western, the sweethearts they were, had the block immediately north of the Middle Ground discovery and it drilled a well to the same reservoir that Pan Am had just had the blowout in. It filed a discovery claim with the AOGCC and got in a big chicken fight with Pan American that lasted 2 years in Alaskan courts...the argument being that Shell was entitled to the discovery royalty reduction (5% as opposed to 12.5%) payable to the State of Alaska, not Pan America. Pan Am won the case.


Above is the Shell Western Gus II, a very cool sort of pontoon drill ship with the rig floor and moon pool between the pontoons. It had various means of ballast to be able to deal with 35 foot tide changes.


In 1962, while Shell and Pan American were squabbling at Middle Ground, up to the north Pan America was drilling at 12,000 feet in its Cook Inlet State Well No. 1, in 10-45 feet of water, looking for gas in the Paleocene Tyonek interval. It found it... and all hell broke lose.


With drill pipe still in the hole they could not outrun the well when it came in during routine coring operations and surface control was lost. Everything that could be closed on the BOP stack was, and pressure continued to climb. Gas bubbling off the mud line was noticed away from the barge several hundred feet, then a crater and large gas boil about 1500 feet away occurred. Estimate flow was 5 MMCFGPD but this well was making about 100 BOPD of condensate, all going into the Inlet.


Pan America sheared the DP below the BOP and floated off the well with the stack still in place. It set fire to the crater and moved around 180 degrees and immediately started drilling a relief well. By November of 1962 the No. 1-R well was within 1000 feet of intersecting the Tyonek formation to begin its kill of the blowout when the Inlet began to freeze over and sheet ice some 3 feet thick formed and moved back and forth with tide movements, causing great concern for the drilling barge. Pan Am temporarily suspended drilling operations in early December with 500 feet and and 15 degrees from vertical to go before intersect.


The fire burned in the Cook Inlet the entire winter of 1962-1963. It was directly over a runway approach at the Anchorage International Airport and pilots used the burning crater for reference in bad weather.

December 1962; the subsurface blowout is still underway, the boil still burning.


By late May of 1963 the same Western Drilling rig barge floated back over the Pan American Cook Inlet State 1-R well and eventually made intersection. The well was killed with sea water, pronounced dead by October and cemented to hell and back. The relief well was completed in the Tyonek for Pan American etals' third, large gas discovery in the basin.


In 1968 oil was found on the North Slope of Alaska and Cook Intent activity was dropped like a rock. By the mid 1970's Union Oil started looking again in the Inlet, as did Shell, then a JV between Shell and Union. More permanent drilling platforms were eventually placed on both the Middle Shoals and Cook Inlet discoveries, Pan American became Amoco, then Arco, and lots of natural gas has been produced from the Cook Intent Basin since 1961, some 1.4G BO and over 7.7 TCF of gas, in fact, thru 2015.

Today, most of those production platforms are owned by Hilcorp, a Texas outfit, and some deeper pays are being found. Hilcorp and a few other small independents has revived the Cook Inlet Basin over the years with many plug backs and some 135 new wells have been drilled. When it bought all that Cook Inlet stuff it inherited a lot of problems and Hilcorp has had several gas pipeline ruptures into the Inlet that they paid for dearly with regards to new pipeline installations, etc. On its Baker Platform in 2014 the living quarters caught fire and upset many people.


I'm fond of Hilcorp for a number of personal reasons; I believe its environmental record in the Cook Inlet has been very good given the age and condition of the stuff they bought. I am very familiar with the National Pollution Discharge Elimination System and the 1966 Zero Discharge Rule enacted by Congress and the EPA; I assure you that produced water being discharged from Hilcorp platforms in the Inlet are not toxic, contain no hydrocarbons or heavy metals and that the Cook Inlet is not the only place produced water discharges occur under the most strict of environmental quality standards; enjoy this little clip for the imagery and scope of operations and remember, no oil company in the world wants to purposefully harm the environment. Turn down the sound if you must.


Boots and Coots, Inc. attended several blowouts in the Cook Inlet in the late 1980's, one in particular I will share with you some day soon that burned, then bridged... but oh man, what a "bridge" that was!




Beluga whales in the Cook Inlet of Alaska.


Captain James Cook got around in his day; a British explorer between 1765 and 1779 he mapped most of New Zealand, Australia, all of Hawaii and in route to discovering the famed, Northwest Passage, sailed into this giant body of water in southern Alaska, which he promptly, and properly, named after himself.


References


[a.] Alaska Oil and Gas Conservation Commission

[b.] Anchorage Museum at Rasmuson Center

[c.] University of Alaska Digital Achieves

[d.] Stephen McCutcheon, photographer

[e.] Ward Wells, Photographer

[f.] University of Alaska, Fairbanks

[g.] American Association of Petroleum Geologists