USGS sees 18-32 tcf recoverable in NPR-Alaska

By OGJ editors
HOUSTON, May 5
– An updated economic analysis indicates that 18 tcf of undiscovered gas are economically recoverable from the National Petroleum Reserve in Alaska and adjacent waters when the market price is $8/Mcf or more and 32 tcf is economically recoverable at $10/Mcf or more if a pipeline were built.

The same analysis found that 273 million bbl of undiscovered oil are economically recoverable at $72/bbl and 500 million bbl are economically recoverable at $90/bbl. The estimates are based on mean undiscovered resources and don’t include the discovered but undeveloped oil accumulations in the northeastern NPRA.

The US Geological Survey economic analysis is based on a 2010 USGS resource assessment that determined how much undiscovered, conventional oil and gas in the NPRA is technically recoverable. These reports provide updates from the USGS 2003 economic analysis and 2002 resource assessment of the NPRA.

Technically recoverable resources are those that could be potentially produced using current technology and industry practices. Economically recoverable resources are those that can be sold at a price that covers the costs of discovery, development, production, and transportation to the market.

The USGS said the economically recoverable oil estimates are dependent upon gas exploration in the NPRA, meaning that it is assumed the oil would be found in the process of looking primarily for gas.

No pipeline exists to transport gas from the Alaska North Slope, so the assessment assumes a 10-20-year delay between discovery and production in the NPRA.

The different market prices quoted for the same resource are because some accumulations are relatively easy to find and produce while others are not and therefore cost more.

USGS scientist Emil Attanasi, lead author for the assessment, said, “USGS estimates are based on 2010 costs and technology, and these results could change over time as they are dependent on multiple factors.

“For example, USGS economic recoverability estimates could vary in the future depending on the timeframe and costs to construct a gas pipeline to the NPRA, technological advances that make resource extraction and development easier and less expensive, and fluctuating market prices for oil and gas.”

The amount of oil that could be economically developed is far less than what the 2003 analysis concluded. One reason for the reduction is reduced volumes of technically recoverable oil based on recent NPRA exploration drilling which found gas rather than oil.

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