EXPLORATION Monument jeopardizes area of Utah's resources

G. Alan Petzet
Exploration Editor

Utah is working hard to salvage the value of coal, oil and gas, and other minerals whose realization was placed in jeopardy with creation of a national monument last year.

The Grand Staircase-Escalante National Monument extends across 1.7 million acres in Kane and Garfield counties (OGJ, Feb. 3, 1997, p. 42). It encompasses 176,000 acres of Utah School and Institutional Trust Lands (Fig. 1 [110798 bytes]).

The monument takes in part of one oil field and perceived additional oil and gas potential, but coal is the big loser (OGJ, Oct. 14, 1996, p. 21). Using a 1996 U.S. Geological Survey resource assessment and excluding resources considered unminable, the Utah Geological Survey estimated that a minimum 11.36 billion tons of coal are technically recoverable from the Kaiparowits Plateau coal field within the monument; of that, 870 million tons is on Utah school trust lands.

President Clinton directed the Interior secretary to trade monument lands administered by the state School and Institutional Lands Trust Administration for other federal lands or resources of comparable value in Utah. State officials are concerned that such comparable lands and resources do not exist, said Lee Allison, UGS director.

The U.S. Bureau of Land Management is assigned to manage the monument. It has started a 3 year study that is to result in a management plan. UGS released preliminary resource assessments in 48 page Circular 93 earlier this year.

Creation of the monument also torpedoes an active Kaiparowits basin exploration program by Conoco Inc.

Reese Canyon prospects

Establishment of the monument may have removed mineral lands from consideration for mining and drilling.

The proclamation stated in part, "The establishment of this monument is subject to valid existing rights." And it is unclear whether or how the concept of multiple use might be employed or interpreted. Some interpretations allow drilling.

Conoco in February sought permits to drill 14,000 ft exploratory wells in the Reese Canyon area of Kane County. One of the spots is on state land, and a permit is likely to be issued shortly. The other is on federal land and subject to BLM approval, probably after completion of the 3 year management study.

The proposed drillsites are about 50 miles east of the "pretty geology" the proclamation sought to preserve, sources said. The state land drillsite, about 45 miles south of Escalante, is adjacent to a county road and near a previously drilled well in 5-40s-5e. Conoco has a development plan that provides for drilling of 10 wells if warranted from two pads.

Existing BLM leases cover 12,000 acres in the Reese Canyon area.

A 1984 study by Petroleum Information Corp., Denver, called the Reese Canyon anticline one of the most attractive exploration targets in the region.

PI said a well at Reese Canyon would evaluate the Precambrian Chuar Group, Cambrian Tapeats sand, and the Carbon Butte sand.

Overall potential

Conoco said it has been evaluating the potential for oil and gas development in the monument for more than 2 years. The company holds valid leases on 140,000 acres of state and federal lands in the monument and another 85,000 acres adjacent to it.

Scientific studies indicate the potential for significant reserves of oil and gas in less scenic areas of the monument, said R.E. Irelan of Midland, Tex., manager of Conoco's midcontinent exploration and production region. The reserves can be developed within the multiple use concept without affecting areas of scenic beauty and historic and scientific significance, Irelan said.

"Multiple prospects, each capable of holding 100 million bbl or more of oil, could be in the region which encompasses the monument and its adjoining areas," Irelan said. "These reserves could be as high as 4 billion bbl," and successful development would benefit the state and the U.S.

Among reasons the area has not been exploited more diligently for oil and gas, listed by UGS, are: Inaccessibility, lack of pipelines, low success rates, the 1986 world oil price collapse and national gas oversupply, and environmental concerns and restrictions.

The monument covers 3.2% of Utah's 82,000 sq miles.

Energy in the area

The monument contains existing and possible resources of several types.

A state Office of Energy and Resource Planning preliminary study concluded the state might eventually realize $9.25 billion in present dollars in royalty and bonus bid revenue over the life of mining of the Kaiparowits coal field within the monument. The federal government would receive a like amount.

The coal field is also estimated to contain 2.6-10.5 tcf of coalbed methane in place.

Numerous publications the past decade have identified the deep Precambrian Chuar Group, one of Conoco's targets, as a potentially significant source of hydrocarbons in the monument.

With a drilling density of one well/57 sq miles (47 wells), the monument is considered lightly explored. Oil or gas shows in the form of drillstem or production tests and live oil stains or bitumen in drill cuttings, have been found in Triassic, Permian, Pennsylvanian, Mississippian, Devonian, and Cambrian age rocks.

Potential reservoirs that may contain significant quantities of hydrocarbons in the monument are the Precambrian Chuar Group, Cambrian Tapeats sandstone, Mississipian Redwall limestone, Permian Kaibab formation, and Timpoweap member of the Triassic Moenkopi formation (Fig. 2 [50085 bytes]).

Only five wells have tested Mississippian and Devonian, and only three penetrated Precambrian. Some 63% of the wells in the monument tested only Permian, with Kaibab limestone the main target.

The monument contains at least 24 major structures, many tens of miles long (Fig. 1 [110798 bytes]). It takes in five existing wells in Upper Valley field, Utah's ninth largest in terms of cumulative production.

The Circle Cliffs might contain as much as 550 million bbl of oil in tar sands within the monument, but there has been little recent interest in working the deposit, UGS said.

Other minerals considered to have development potential include titanium, zirconium, vanadium, and uranium.

Upper Valley field

Upper Valley field has produced 25.1 million bbl of oil since discovery in 1964 (Fig. 3 [89298 bytes]).

Citation Oil & Gas Corp., Houston, operates the field's 22 active wells. The five wells claimed by the monument accounted for nearly 27% of the field production in September 1996 and 10% of cumulative production. The field produces about 20,000 bbl/month of 19-26° gravity oil from dolomitized carbonates of the Permian Kaibab formation and Timpoweap member of Triassic Moenkopi at 6,300-7,600 ft.

Two water injection wells on the monument are part of a 10 well peripheral waterflood program started in 1969 in which more than 10 million bbl/year of produced water is reinjected to maintain pressure and increase recovery.

No pipelines exist other than to gather the oil into lease tanks. The oil is trucked 300 miles to Salt Lake City refineries.

Citation's 1997 plans include remedial work at several wells but no new drilling thus far.

UGS's Allison wonders whether any operator would be permitted under the BLM management plan to drill wells aimed at extending the field's Permian Kaibab pay or explore for deeper pay in formations of Mississippian or other ages. One of the field's first wells produced 17,000 bbl of oil from Mississippian Redwall, but that zone has not been completely explored in the field area.

Published data indicate two potentially significant unknowns about Kaiparowits basin exploration.

One is that hydrodynamic drive has forced hydrocarbon accumulation 1-3 miles off the crest of the structure at Upper Valley field. This fact could be important in the siting of other Kaiparowits wildcats.

The other is that core data from unproductive wells immediately surrounding the field indicate a complete lack of oil charge along certain parts of the anticline (OGJ, Jan. 7, 1985, p. 112).

Coalbed gas, CO₂

UGS also sees major coalbed methane and CO₂ resources in the monument.

The major coal deposits and associated coalbed gas occur in the John Henry member of the Straight Cliffs formation. The top of coal in the monument is found from surface to nearly 6,000 ft.

Based on industry guidelines, areas considered prospective for coalbed gas have at least 10 ft of net coal thickness at 1,000-6,000 ft. This area lies mostly in Kane County along the Garfield County line and just east of Bryce Canyon National Park.

Of the 2.6-10.5 tcf believed in place, 67% recovery at $1.20-2.50/Mcf would yield $2-17.5 billion.

Allison said coal in other parts of the state has drawbacks. Much of it would have to be strip-mined in areas close to and visible from existing national areas. The industry has self-imposed a voluntary ban in one area near Capitol Reef National Park. Other coals have sulfur, sodium, or ash content in excess of coals in the monument.

CO₂ is present in many large anticlines of the Colorado plateau. CO₂ is a large component of the associated gas at Upper Valley oil field.

Wells on the Escalante and Circle Cliffs anticlines flowed at rates of 12.4 and 5 MMcfd of 93-99% CO₂, respectively.