BP Exploration Alaska Liberty offshore oil project on hold

BP Exploration Alaska Inc. indefinitely suspended its Liberty oil field project in the Beaufort Sea offshore Alaska, citing project engineering and economics although the company said it might redesign the project later.

The BP unit had planned to drill wells nearly 2 miles deep and with offsets as long as 8 miles (OGJ, Oct. 2, 2006, p. 37).

Using a land-based rig to drill ultraextended-reach wells into Liberty field, the BP unit initially expected oil production to begin in 2011, ramping up to 40,000 b/d, with an estimated ultimate recovery of 100 million bbl oil.

“After a full review of project engineering and economics, BP has decided not to pursue the proposed Liberty project, in its current form,” company spokeswoman Dawn Patience told OGJ. “BP is in the process of working with regulators to discuss the potential forward plans for the project.”

Patience said rig modifications necessary to drill the ultraextended-reach wells to BP standards would increase project costs significantly above the original $1.5 billion project estimate.

BP’s decision process included a detailed 18-month review of the rig systems, an analysis of the project’s risk and economics, and an assessment of the evolving regulatory framework, Patience said.

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