Oil Search North Slope oil discoveries could present tie-back options

Oil Search Ltd. discovered oil from a sidetrack well as part of its Alaskan drilling program that supports the potential for resource growth in the company’s North Slope leases and may present low-cost tie-back options to the proposed Pikka Unit development, pending further appraisal.

Testing of the prime Nanushuk reservoir in the Mitquq-1 ST1 well, a sidetrack from the Mitquq-1 oil discovery, encountered a net pay zone of 52.5 m with a gas cap of 9 m.

When tested, the well flowed at a stabilized rate of 1,730 b/d of oil from a single stimulated zone.

Managing director Keiran Wulff said the sidetrack well also discovered high quality oil in a deeper reservoir which was not tested.

The Mitquq discovery lies 9 km east of the proposed central processing facility of the Pikka Unit development.

Additionally, the Stirrup-1 wildcat, about 12 km west of the 2017 Horseshoe oil discovery well and 35 km southwest of the proposed Pikka Unit development infrastructure, found an oil column with net pay of 23 m. When tested, Stirrup-1 flowed at a stabilized rate of 3,520 bo/d from a single stimulated zone in the Nanushuk reservoir.

Both wells and test programs have provided valuable information regarding the geology and well productivity of the Nanushuk play in areas to the east and southwest of the Pikka Unit, the company said.

Drill crews are now demobilizing and will be off-location by mid-April to end the winter drilling season.

Wulff said that given current market conditions, Oil Search will delay the final investment decision date for the Pikka Unit development. The additional time will enable the company to further engineer the development with a focus on reducing the break-even of the project and integrate the results of the Mitquq and Stirrup wells, he said.

At present the company is not planning an exploration drilling program for the next (2020-2021) winter season but will instead focus on work needed to comply with permit obligations for the planned Pikka Unit development so that it can proceed when oil prices improve.