Advancing Pikka – November 07, 2021

On November 2, Oil Search Alaska, or OSA, filed the Pikka 2022 unit development plan for the one-year period beginning February 1, 2022, with the Alaska Department of Natural Resources and its division oil and gas.

Based on the work carried out under the previous exploration and development plans of the Pikka unit, including evaluation drilling activities in 2018-2019 and construction of civil works from 2019 to 2021, OSA said the vested interests continue to push development forward to establish Pikka’s oil and gas production.

The direct interest owners of the Pikka unit, or WIO, are the operator OSA with 51% and Repsol E&P USA with 49%.

In its proposed development plan for 2022, or POD, OSA told the division that Phase 1 of the Pikka project involves a single drill site, ND-B, and associated pipelines and production infrastructure. (The company previously said peak production from Phase 1 would quickly reach 80,000 barrels per day.)

?? The WIOs will drill wells and construct and operate infrastructure and facilities to produce and transport crude oil from Nanushuk and other reservoirs, ?? OSA said.

Pressure on division

Key upcoming development activities ?? in POD 2022 are ?? subject to timely receipt of satisfactory division and other regulatory approvals, business terms and economic conditions. ?? These development activities include continued engineering and regulatory activities as part of the WIO’s decision to sanction the project in 2022, the OSA said in the proposed POD.

The company pointed out that the decision and opinion of a final manager to proceed with the construction phase of the seawater treatment plant, or STP, of the installation and pipeline project did not yet been issued by the division.

This notice to proceed is a necessary prerequisite for the construction of the STP facility and pipeline. Given the need for water of sufficient quality and quantity for the Pikka development operations, ?? the division’s advice to proceed has an impact on the ability of WIOs to make significant project financial commitments necessary to maintain the project schedule, ?? OSA said.

Failure to receive notice to proceed with the construction phase of the STP facility and pipeline project will jeopardize the start of production at Pikka, the company said.

Work commitments

Maintenance work on existing project infrastructure will continue in 2022, OSA said in its proposed POD, including minor maintenance of gravel roads and platforms and snow clearing of some culverts before the spring break-up, as well. as the semi-annual inspection of the Miluveach River Bridge.

In addition, the company said that work at Nuiqsut for the US Army Corps of Engineers compensatory mitigation projects is planned, either during the winter season of 2022 or 2023. This work includes the construction of a new gravel pad and the completion of a geotechnical program.

Subject to the sanction of the project, development drilling initially targeting the Nanushuk reservoir is expected to begin in 2023 from the ND-B platform.

Field infrastructure construction activities will continue in 2023 to support field production from 2025.

Environmental studies continue

?? WIOs will continue to conduct environmental studies to protect biodiversity, ?? OSA, which includes programs on hydrology, fish, water quality, waterfowl, Nuiqsut fall subsistence fishing, caribou and subsistence use in the area.

OSA said it will also continue to work with key North Slope stakeholders, including the North Slope Borough, Kuukpik Corp. and the community of Nuiqsut, noting that it regularly organizes events in the community of Nuiqsut, stressing the importance of healthy communities, training opportunities and maintaining sustainable livelihoods.

The components of the overall development infrastructure, including future phases, are:

* The Nanushuk Processing Facility, or NPF, which will receive production from the ND-B development platform and future development drilling sites, and process it to commercial grade crude, and more.

* Nanushuk Operation Pad, or NOP, which includes the main camp, stores, storage and a gas station.

* ND-B development block.

* Infield pipelines and cables.

* Import and export pipelines:

* Tie-in Pad, or TIP, which will facilitate the connection of the Pikka sales pipeline to existing North Slope export pipelines.

* Other civil infrastructure including gravel platforms for all facilities with connecting gravel roads and bridges.

* Sea water treatment station.

OSA said it will continue to refine the subsoil modeling and advance the design of development wells, in preparation for development drilling.

The company stated that it has completed sufficient assessment drilling activities to define resource targets (and surface locations) for the proposed development.

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