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Home My WebLink AboutCO 040Conservation Order Cover Page XHVZE This page is required for administrative purposes in managing the scanning process. It marks the extent of scanning and identifies certain actions that have been taken. Please insure that it retains it's current location in this file. Conservation Order Category Identifier Organizing RESCAN [] Color items: [] Grayscale items: Poor Quality Originals: [] Other: NOTES: DIGITAL DATA [] Diskettes, No. [] Other, No/Type OVERSIZED (Scannable with large ~""'""Maps: [] Other items OVERSIZED (Not suitable for plotter/scanner, may work with 'l~,sC_.anner) I~,/~Logs of various kinds [] Other BY: ~ MARIA Scanning Preparation DATE: ~ ~3 ,V' ~_~(~) ~-_~):::.z...~ TOTAL PAGES Production Scanning Stage 1 PAGE COUNT FROM SCANNED DOCUMENT: PAGE COUNT MATCHES NUMBER IN SCANNING PREPARATION' ~ YES NO Stage 2 IF NO IN STAGE 1, PAGE(S) DISCREPANCIES WERE'FOUND: ~ YES ~ NO (SCANNING IS COMPLETE AT THIS POINT UNLESS SPECIAL ATTENTION IS REQUIRED ON AN INDIVIDUAL PAGE BASIS DUE TO QUALITY, GRAYSCALE OR COLOR IMAGES) General Notes or Comments about this Document: 5/21/03 ConservOrdCvrPg.wpd STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCES DIVISION OF MINES AND MINERALS ALISKA OIL AND GAS CONSERVATION COMMITTEE 3001 Porcupine Drive Anchorage, Alaska RE: THE APPLICATION OF THE PJ~ AMERICAN PETROLEUM CORPORATION for a temporary spacing order allowing "cluster" spacing in the North Cook Inlet Field which involves exceptions to Section 2061.2 of theAlaska Oil and Gas Con- servation Regulations, Title 11, AAC Conservation Order #40 June 8, 1967 IT APPEARING T~kT: 1. The Pan American Petrole~n Corporation, applicant in the above ~titled matter, on behalf of itself, Phillips Petroleum Company, Sinclair Oil & Gas Company and Skelly Oil Company submitted a request received April 27, 1967, for a "cluster" spacing order covering an area designated as the Tert£ary System Initial Partici- pating Area of the North Cook Inlet Unit in the North Cook Inlet Field. 2. Notice of the hearing was published On May 3, 1967, in the Anchorage Daily News. 3. A hearing was held in the City Council Chambers of the Z. J. Loussac Library: Anchorage, Alaska, at 9:30 a.m.~ on May 15, 1967. 4. Testimony in support of the application was given by Pan American Petroleum Corporation's duly authorized representatives and there were no objections from affected parties. AND IT FURTHER APPEARING that exceptions to Section 2061.2 of the Alaska Oil and Gas Conservation Regulations should be granted in addition to those allowed by uniti- zation because operating conditions necessitating directional drilling from a platform in waters of Upper Cook Inlet would make the drilling of wells on a regular spacing plan unduly hazardous and expensive. AND IT FURTHER APPEARING that geological and reservoir conditions are such that the affected area will be adequately drained by a cluster pattern of wells direction- ally drilled from a single platform as indicated on Exhibit "B" of the application. CONSERVATION ORDER #40 Page 2 June 8, 1967 AND IT FURTHER APPEARING that the interval in the Pan .American Petroleum Corporation State well #1 between the depths of 3500 feet and 6200 feet has been proved productive of gas and this interval comprises the presently unitized interval in the North Cook Inlet Initial Participating Area Tertiary System. NOW, THEREFORE, IT IS ORDERED that the area affected by this order is described as fo 1 lows: Township 12 North, Range ,9, West Section 33: NW/4 Township 11 North, Range,, ,9, West Section 8: N~2 SW/4 Township 12 North, ,,,,Ranse 10 West Section~ 35: SE/4 To~wnship ~11 ,Nor,t,,h~, Range ,,1,0,,',,West Section 2: E/2 Section 11: E/2 Tp~_wnship 12 No..rt.h.,..Range 9 West Section 31: All Section 32: All Tpwnship 1! North, Range 9 West Section 5: Ail Section 6: All Section 7: All Section 18: N/2 _Townshipll,North, Range,!0,Wept Section 12: All Section 13: N/2 .To_~wnship !2No~th,=Rang~,,,9,~,S,t Section 21: W/2 Section 28: W/2 Township 12 North, Rang~......? West Section 19: SE/4 Section 20~{ NE/4, S/2 Section 29: All Section 30: All CONSERVATION ORDER #40 Page 3 June 8, 1967 Township 12 Nor.th~ Range 10 West Section 25: SE/4 Section 36: Ail Township 11 North~ Range 10 West Section 1: Ail The following special rules apply to the aforementioned area: RULE i Pool D~esign~tion - The pool affected by this order is called the Tertiary System Gas Pool. It§ vertical limits are defined as the interval which will correlate with the interval~'.3500 feet to 6200 feet in the Pan American Petroleum Corporation North Cook Inlet State 17589 well #1. RULE 2 Well Spacing - Gas wells may be drilled on a "Cluster" spacing pattern in accordance with the pattern shown on Exhibit '?B" of the application. This Order is made pursuant to Section 2061.3 of the Alaska Oil and Gas Conservation Regulations and shall continue in force for a period of not more than eighteen (18) months provided, however, that wells which have been drilled and completed and are being produced in compliance with the provisions of this Order, or any other Order of the Committee, may be produced in compliance with the terms of said Order notwith- standing the fact that such Order may have expired or have been terminated, or that there may be pending a request that said Order be modified or terminated, until such time as the Committee shall, after notice and hearing, enter an Order establishing different rules, establishments, or provisions. The Committee on its own motion, or at the request of any interested party, may at any time during the temporary period set this matter for further hearing for the purpose of determining whether the present Order should be amended or modified. The Committee will, in the absence of a request of an interested Party for a hearing at an earlier date, set this matter for hearing for a date which shall be not later than 30 days prior to the date of the expiration of this Order, for the purpose of determining the proper spacing and field rules which should then be applicable to this field. CONSERVATION ORDER #40 Page 4 June 8, 1967 DONE at Anchorage and Juneau, Alaska, and dated June 8, 1967. Thomas R. Marshall, Jr. Executive Secretary Alaska Oil and Gas Conservation Committee Concurrence: /Z~a~e'~""'A'~'" williams, Chairman AlAska Oil and Gas Conservation Committee Dale Wall Member ington, Alaska Oil and Gas Conservation Committee ~Karl ~ ~der~he' Member .......... Alaska Oil and Gas Conservation Committee 9 ' 10 11 12 13 14 15 16 17 18 19 20 gl CONSERVATION FILE No. 40 <27 HEARING BY' THE ALASKA 0II~ AND GAS COMMITTEE for an ORDER FOR WELL SPACING IN' THE NORTH COOK INLET FIELD. R & R COURT REPORTERS 821~ INEBT EIGHTH AVENUE -- llUITE II 277-4713 ANCHORAGE, ALASKA Anchorage, Alaska May 15, 1967 10 11 12 14 15 16 17 18 19 2O 21 22 23 24 25 PROCEEDINGS MR. WILLIAMS: This is a hearing being conducted by the Oil and Gas Conservation Committee on an application from Pan American Petroleum Corporation on behalf of itself and Phillips, Sinclair, Skelly, Shell, Richfield and Standard in which they are petitioning the Oil and Gas Conservation Committee for an Order for well spacing in an area designated as the tertiary system initial participating area of the North Cook Inlet Unit of the Nor'Ch Cook Inlet Field. This hearing was advertised on May 3 with sufficient time, sufficient legal notice for a hearing of this nature 'which is not of Statewide application. Sitting here on the Committee today besides myself, Williams, are Tom Marshall, Executive Secretary of the Committee Karl Vonder Ahe; Dale Wallington was unable to be here at this moment but he may come in on us at any time. There's been a delay and' he said he'd try to make it. As advisors to the Commit tee we have O. K. Gilbreth, Petroleum Engineer, and Harry Kugler, Petroleum Geologist. And with that we will proceed. Will you introduce yourself? MR. JONES: I'm Carl W. Jones, of Bartlesville, Oklahoma, ! Assistant General Attorney of Phillips Petroleum Company, a membe of the Oklahoma and Texas Bars. My co-counsel, I think, is knowr to most of you but for the record Mr. C. E. McDonald, Jr., in addition Chief Attorney of Phillips Petroleum Company of Denver and a member of the Colorado and Oklahoma Bars. This is our firs R &: R COURT REPORTERS 825 WE~,T EIGHTH AVENUE -- SUITE 5 277-4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 v20 21 22 23 24 25 - 3 - appearance at a formal hearing of the Committee and I want to express our pleasure at being here. I believe the file of the Committee will contain two letters, one of which was written by Mr. Eben H. Lewis on May the 9th, referring to his inability to be here as local counsel and stating that Mr. McDonald and myseli would present the application. The file also contains a letter written on May the 8th by Mr. Oscar E. Swan of Pan American Petroleum Corporation stating that Phillips Petroleum Company would present the testimony and evidence on this application. I may state for the record that the application was filed by Pan American Petroleum Corporation as operator on of itself, Phillips Petroleum Company, Sinclair Oil and Gas Com- pany, .and Skelly Oil Company, Shell Oil Company, Atlantic- Richfield Company, and Standard Oil Company of California. I ~ also may state that the reason Phillips is presenting the~ appli- cation is that Phillips has contractual commitments with these , other working interest owners and lessees in the participating area to purchase their interest in 'the participating area, and will become operator of the property; and that is the reason Phillips is~roceeding with the application even though it was filed by Pan American as operator of record. The application is for a spacing pattern for the tertiary system, initial participating area, of the North Cook Inlet unit in the North Cook Inlet Field. In the application it is requeste that a cluster spacing pattern which will be described in the res Div. of~VI &Marls & R COURT REPORTERS WEST EIGHTH AVENUE ~ SUITE · 277-4713 ANCHORAG£. At=A$~A 10 11 12 13 14 15 16 17 18 19 2O 22 23 24 25 -4- 'mony be adopted as the spacing pattern for this participating area, in lieu. of the regular 640-acre grid spacing ~pattern. We hope to be able to show that this spacing pattern will sufficiently and adequately drain these reservoirs within the participating area, that it will save iQ. c~?st of development and operation. approxi~ately 2.8 million dollars, that it will develop within this area deliverability one and a half times the deliverability that would be obtained by a regular grid spacing pattern, and that such increased deliverability is necessary for Phillips to meet its Contractual commitments for the sale of this gas. The tertiary system initial participating area referred to in the applica~tion and which will be referred to in the testimony was approved by the Division of Lands of the State of Alaska on April the 26th, 1967, effective January the 22nd, 1967. The applicant, Phillips~ Petroleum Company, will present two'wit- nesses, twelve exhibits, and anticipates its case in chief will probably take one hour and fifteen minutes. First I w~ld like to introduce as a matter of orienta- tion, Phillips Exhibit 1 which is a plat or map showing the location of the North Cook Inlet Field. I may add this, as far as this procedure, that all of these exhibits are designated as Phillips exhibits instead of Pan American's exhibits. May we proceed with the witnesses? MR. WILLIAMS: Yes. We'll accept Phillips EXhibit No. 1 into the record of the hearing. 6~ R COURT REPORTr:'RS WEST EIGHTH AVENUE ~ SUITE 2'77.4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 22 23 24 25 MR. JONES: Our two witnesses will be Mr. L. L. Vigoren who will present geological testimony and Mr. J, E. Chrisman who will present the petroleum engineer' s testimony. L. L. VIGOREN , , having first been duly sworn, testified as follows on examination BY MR. JONES: Q .Will you state your full name into' the record, please? A L.L. Vigoren. Q Mr. Vigoren, have you ever appeared before this Committee and had your qualifications as a petroleum geologist accepted? ' . A No, sir. Q Ail right, sir. Will you briefly state your educational training as a petroleum geologist? A I was graduated from the South Dakota School of Mines with a B. S. in geological engineering in 1957. Q Ail right,and 'by whom were you employed after you graduated as a geologist? A I was employed by Phillips Petroleum in 1957. All 'right. Will you briefly describe your earlier employment with Phillips? A My first employment was on a training program with the exploration department and that consisted of three months in Western Kanses on a seismic crew, three months in Den- ver on a surface crew, and three months in Billings as a R & R COURT REPORTERS 825 WEST EIGHTH AVENUE ~ SUITE 5 277-4713 ANCHORAGE, ALASKA 1 2 3 4 5 Q 7 A Q 9 A q. ~.o lO 11 12 13 14 15 16 24 25 District staff geologist-trainee. And fromthere I went to Bartlesville for a short time in the regional explora- tion office; and from there to the production department as a trainee engineer, which consisted of roughne.cking, roustabouting and staff engineer work in Alvin, Texas. All right, sir. Where did you go from Alvin, Texas? From Alvin to Amarillo, Texas, as a development geologist Amarillo, Texas, in the Texas Panhandle is the center of a well-known gas area, is it not? Yes, sir. Ail right. Did you. occupy any supervisory position as a geologist in Amarillo with Phillips? Yes, sir. I was the development field supervisor for approximately two years. Then where did you go from Amarillo? · To Anchorage, Alaska. What date did you come here?' February, 1965. What has been the nature of your duties and responsibilit) here in Anchorage? I'm development deologist and primarily take care of the field development geology that's in the Anchorage district Ail right, and as part of that responsibility have you done geological work in connection with the North Cook Inlet Field? Div. of'M & Inc. with I~e und~e~t~ndln~ I~t it ~ b~ ~ f~ In~nl~n/u~e oo~. ] R & R COURT REPORTERS 825 WEST EIGHTH AVENUE ~ SUITE ~ 277-4713 ANCHORAGE. ALASKA 1 A 4 9 10 A II 12 14 15 16 17 ~8 q 19 2O A 21 Q 23 24 A 25 Yes, sir. With specific referenc~ to this application have you studied the matter stated in the applicatinn and pre- pared testimony and exhibits for this hearing? Yes, sir. . The exhibits were prepared.by you? Yes, sir. Mr. Vigoren, will you state what is the first exhibit that you have prepared? Sir~ the first exhibit that I have prepared--the first exhibit that we have. is a structure map on top of the Cook Inlet sands in the tertiary system. It's on a scale of on inch equals 2000 feet and the contour interval is 200 feet As you.can see, the structure is indicated as an anticline trending northeast~southwest, and the~data that was.used to come up".with"thi$-structure map is primarily subsurface well control and seismic data. That structure map is marked as Phillips Exhibit 2, is 'that correct? Yes, sir, the dashed line that we've shown here, shaded,is the gas-water contact and we've shaded in the produccive All right. What is the next exhibit which is marked Exhibit 3? It is also a structure map. it is a map on top of the Beluga "B" sands. The contour interval is 100 feet, and Div. of'M & Marls R & R COURT REPORTERS 8215WEST EIGHTH AVENUE ~ SUITE · 277-4713 ANCHORAGE, ALASKA p,~rt .3 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 it also shows an anticline trending .northeast-southwest. The water table again is shown as a dashed -- or the estimated water table is shown as a dashed line there at the center of the structure. Q All right. The next exhibit, Exhibit 4, what is it, Mr. Vigoren? A It is also a structure map contoured on the top of the Beluga "C" sands, and 'also in here it has a contour interval of 100 feet; the scale of all these'maps are on~ inch equals 2000 feet, and We have shaded in the productive part of ~t.he reservoir, the estimated productive part. Actually the zero line here is the estimated water table and also on this map we've shown the isopach, which...-- it"s a net pay isopach. It goes from zero to forty feetm and these are the dashed lines. Have you -- excuse me. MR. WILLIAMS:' Are these maps here duplicates of what you have on the wall? A Yes, sir. Q Mr. Vigoren, have you prepared two cross-sections of this area? A Yes, sir. We have two cross-sections. The first one would be this one. It's a northeast-southwest trending cross-section. The first well which would be on the sout~ end would be the Pan Am State-Cook Inlet State 18740. Div. of'~ &Marls R & R COURT REPORTERS 82~ WEST EI(~HTH AVENUE ~ SUITE ~ 277-4713 ANCHORAGE, ALASKA .3 10 11 12 13 14 15 16 17 18 19 2O 21 A A The No. 1 17589, the discovery well,, and on the north end the Shell North Cook Inlet State. Would you point out those wells as shown, say, on Exhibit 2? Yes, sir. Here would be the 18740 well, the well on the south here. Here's the discovery well, and here is the Shell North Cook Inlet well. Ail right. The other cross-section? We've shown the -- do you want me to go through these? Yes, go ahead. We've put the correlation lines for the -- here's the top of the Cook Inlet formation with the estimate of the water table and shwon in the -- in these three benches of sand, and we have the other 'two estimated water contacts as shown, with the shaded portion being the gas productive intervals. And also the correlation acroSs the structure' on the Beluga "B" sands and Beluga "C" s and s. I offer the next exhibit. That is marked Phillips Exhibit 5, is it not? Yes, sir. Ail right. The next exhibit. Exhibit 6. Exhibit 6 is a west to east cross-section. The first well is Pan Am Cook Inlet State 17591, and then the Cook Inlet State 18740, No. 1, and the 17589 No. 1 is the R & R COURT REPORTERS S2S WEST EIGHTH AVENUE ~ SUITE S 277-4713 ANCHORAGE, ALASKA 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 q q discovery well, and then the -- on the east side o~ the structure we have the Pan Am Cook Inlet State 18741, No. 2, and also the Pan Am State 18741, No. 1, that is drilled to 6030 feet and due to' mechanical difficulties we could not log, so we don't have -- this is the sample log, estimated intervals. Would you indicate those wells on Exhibit 2, please? Yes, sir. Here is the Cook Inlet State 17591, the first well on the left, and here's the 18740, No. 1, the dis- covery well, at the top of the structure. The 18741 well No. 2 on the east side, and the 18741 No. 1 well over on this side. All right. What is your Exhibit 7? Exhibit No. -- Exhibit No. 7' is the net pay isopach of the Cook Inlet sands. The contour interval is 50 feet and the scale of the map is one inch to 2000 feet. The , zero net pay fsppach line is dashed in this case, which is the edge of the water contact in these Cook Inlet sands, and we've contoured this up to the top of the structure wgere we have 250 feet of contour interval on top. The green line, of course, is the participating area Ail right. What is Exhibit 8? Exhibit No. 8 is a net pay isopach map of the Beluga '"B" sands, which would be this interval here. We've estimated the water contact because it is not cut by a well, and of R & R COURT REPORTERS 825 WEST EIGHTH AVENUE ~ SUITE 5 277-4713 ANCHORAGE, ALASKA { tI - 11 - 10 11 12 14 15 16 17 18 19 2O 21 22 23 24 A Q course that is the dashed zero net pay line here. And of course this isopach does build up to fifty feet on the top of the structure. Have you also prepared an isopach map for the Beluga "C" sands? Yes, sir, and that is on Exhibit 4, and again it is estimated the water contact of the Beluga "C" sands because it is not cut by a well, and the zero net pay isopach line, of course, is this one. It's dashed and of-course the water contact -- estimated water contact an~ the -- it builds up to forty feet on the top of the structure. Ail right. Will you explain, Mr. Vigoren, how you picked the gas water contact as shown on Exhibits 2, 3, and 4, and the zero net pay line as shown on Exhibit 7, 8, and also on Exhibit 47 Yes, sir. The water contacts were cut in each of these wells shown on this section 'and we have productions tests. In -- in this case we have one that --well, on the top the sands and on this -- on this section we 'have up here at the top of the sand -- it's a test or a log analysis, shows in the samples and so on, we've estimated these different water contacts. In this case, 18741, of course we have a test in the water and a test in the gas sO · we f have picked it at -4260. The other water tables in each & R COURT REPORTERS WEST EIGHTH AVENUE ~ $UlTE ~ 277.4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 22 23 24 25 - 12- Q A q A A A q A of the sands, of course, have not been cut in the wells so we've estimated them and the tolerance is fairly close with the control we have. Ail right, now on the exhibits, the lower exhibit.s, the straight lines -- the zigzag lines indicate the participa ting area, is that correct? Yes, sir. Does the participating area as outlined on those, exhinits comprise essentially all of the productive area which is shown on the Exhibits 2, 3 and 4? Yes, sir, i't does. There are two or three little notches in there which are relatively~ insignificant, are they not? They're just very minor. With that very minor exception the participating' area does include essentially all of these productive areas, does it not? Yes. Mr. Vigoren, based upon your study of the North Cook Inle Field. and your preparation for this hearing and the exhi- bits which have been prepared by you, is it your opinion that the productive sands which you have indicated are essentially continuous sands throughout the participating area? Yes, sir, they are. Do you have anything further to add, Mr. Vigoren? R & R COURT REPORTERS 277.4713 ANCHORAGE:, ALASKA I~,.~,,;~ Div. of~ & Marls '~"'~"~ l with ~ ~q~qq~dh~ e;he! It ~y ~ tq~q~dq~l~ fCn' iflh~.,eotlq~p4my ~'14 Oflh/. 10 11 12 14 15 16 17 18 19 2O 21 23 25 - 13 - No, sir. MR. JONES: That's all the questions of this witness,. MR. WILLIAMS: Mr. Jones, I 'neglected at the outset to establish the fact that there had been no protests to thi.s .pro- ceeding, so since there's -- there not very well being objections we will at this time accept Exhibits 2, 3, 4, 5, 6, 7 and 8 into the record. MR. JONES: All right. Thank you. Are there any questions of this witness? MR. WILLIAMS: Any questions? No questions. Our next witness is Mr. J. E. Chrisman. Mr. Chrisman, you've been sworn, have you not? A Yes, sir, I have. Q Have..you ever testified before this Oil and Gas Conserva- tion Committee and have your qualifications accepted as a petroleum engineer? A No, sir, I,have not. Q Will you state briefly your qualifications and experience as a petroleum engineer? A I graduated from the University of Kansas in February of 1949 with a Bachelor of Science degree in electrical ~ engineering. Following that I was employed by Phillips Petroleum Company and spent one year in,·their training program in the production department.. I was tken assigned to a general engineering job in Odessa, Texas, R &: R COURT RiiPORT£RS 825 WEST EIGHTH AVENUE -- SUITE 277-4713 ANCHORAGE, ALASKA 9 11 12 14 15 16 17 18 19 2O gl 25 q A A q q A q and worked as a general engineer until about the begin- ning of 1953. At that time my work assignment carried me into reservoir engineering. I remained at Odessa doing reservoir engineering for another year and a half until about mid-1954. At that time. I was transferred to Bartlesville, Oklahoma, and I have worked in Bart!esville ever since. I have worked with Alaska as part of my responsibility for the last two and a half years. , And in connection with that. employment and being responsi- bre for Alaska in your work with Phillips Petroleum Com- pany have you had occasion to familiarize yourself wit~. the North Cook Inlet Field? ~ Yes, sir, I have. Have.you prepared 'testimony and studies and exhibits with particular reference to the subjedt of this application? Yes, sir, I have. And ~hose exhibits were prepared by you? Yes, sir, they were. Mr. Chrisman, are you familiar with the contents of the application? Yes, sir, .I am. ~ Paragraph one of the application states that the vertical and horizontal productive limits of the participating area have been established by certain wells, and seven wells are described. R & R COURT RE, PORTE, RS 277-4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 22 23 A A q A q A A q A Yes, sir. Those seven wells, in your opinion, have established the horizontal and vertical productive limits of the field9. Yes, sir., .they have. In' paragraph two it's. stated that the owners of interest North Cook'Inlet Field have agreed to unitize their interest as authorized by Section 38.05.180 of the Alaska Statutes. Is that statement correct? That is correct, yes, sir. ? Who owns the royalty under the designated participating area? . It is, owned by the State of Alaska. Has a participating area under that unit agreement been established covering a portion of the North Cook Inlet Field? Yes, sir, it has. Has that participating area. been submitted to and approved by the Division of Lands in the State of Alaskag. Yes, sir, it has. On page 2 of the application there are certain owners and percentage of ownership set forth which are stated to be included in the tertiary system initial participating area. Subject to the fact that Phillips Petroleum Compan has a contract from the other working interest owners to purchase their interest in the participating area and R COURT RE:PORTERS W£ST E, IGHTH AVENUE -- SUITI~' · 277.4713 ANCHORAGE, ALASKA 10 11 12 15 16 17 18 19 2o 21 25 A A A A thereby become operator of the participating area, is that tabulation correct? Yes, sir, it is. At what interval are the three formations which have been indicated to be productive as shown on prior exhibits found in this area? They all appear between the depth of 3500 feet and 6200 '~ · feet in State 17589 well No'. 1. Is that vertical interval subject to the unit agreement? Y~s, sir ,it is. Mr. Chrisman, do the formations which have been testified to by P~r. Vigo.ren and which are indicated on prior exhibits include, in your opinion, all of each common accumulation of~gas in the formation? Yes, sir, they do. With reference to location from shore and the de~pth of the water where is the -- this particular part of the North Cook Inlet Field found?' This is about six miles from the nearest shore or about twelve miles from the east or south shore. Our gas line --our gas sales line will go to the east or south shore. The depth of the water is about one hundred feet.' Mr. Chrisman, you testified previously that you have prepared certain exhibits for presentation 'at this hearing. Will you describe those e~hibits, please? R COURT RI~PORTi~R$ W£~T EIGHTH AVENUE ~ SUITE 277-4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 18 19 2O 21 22 23 24 25 A, Yes, sir, I will. I have prepared four exhibits. They're. numbered 9, .10, 11, and 12. Exhibit 9 .includes material in the blue folder. Exhibits t0, 11 and 12 are loose inside the front cover of the folder. MR. WILLIAMS: Exhibits 9, 10, 11 and 12 will be accepte into the record. A A For the benefit of the observers I do have two extra copies. Mr. Chrisman, will you go through Exhibit 9 giving ver- baqly~what 'testimony from Exhibit 9 you deem appropriate? Ail right, sir. Turning to the Table of Contents, two sheets have been added, that are not shown on the Table Of contents. These are Exhibits A and B to the spacing application which was filed by Pan American. Those are at the back of-the -- of the exhibit. I also have. some · extra copies of those. Exhibit 9 is in narrative form. I will amplify.from some of the...'contents from time to time. Starting at page 1, the North Cook Inlet Field was discovered in August, 1962, by Pan American Petroleum Corporation as operator for itself, Sinclair Oil and Gas 'Company, Sketly Oil Company and Phillips Petroleum Com2 , pany. The discovery well, State 17589, well No. 1, blew out during drilling operations in August, 1962. State 17589 No. I'A was spudded as a relief well and was com- pleted as.a shut-in producer in August, 1964. Test data R C:OURT REPORTERS WEBT EiOHTH AVENUE ~ SUITE ~ 277.4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 18 19 gO gl q on 17589 No. 1 and on all other wells completed since ~ are included on Attachment No. 2. To this date, seven wells have been drilled in or adjacent to the area for which Spacing is being requested. These are list.ed in the bottom half of page 1 and I won't repeat that at this time. Subsurface data from these seven wells -- ExcUse me, Mr. Chrisman. Those wells are the same wells that are shown in paragraph 2 of the application, are they not? Yes, they are. Subsurface data from these seven wells plus area geophysical data have established the productive limit. ' Shown on Phillips Exhibit No. 2. Mr. Vigoren has treated this separately ~in geologic testimony, and additional discussion will not be included at this time. The tertiary sand system members for which spacing 'is being sought were encountered between the depths of 3500 feet and '6200 feet in State 17589 well No. 1, and have been shown in Mr.Vigoren's cross-section. In addition, copies of the electric log of State 17589 well No. 1 are included as an attachment, to Exhibit No. 9. Several productive sand members exist in the interval between 3500 and 6200 feet, and it is proposed that wells completed in the future be completed so' that the various zones are depleted simultaneously. In other words, tr'eated as if they were a common source Of supply. & R COURT REPORTERS WE:ST EIGHTH AVIZNUiZ -- ~UIT~ · ~7~-4713 ANCHORAGe, ALASKA 10 11 12 13 14 15 16 17 18 19 2O 23 24 - 19 - Each sand member can be penetrated by each well drilled in the cluster pattern, and thereby maximum recovery of gas will be realized. Now this will occur by one of two methods. If the drive is pressured at depletion it will be the result of a combination of lesser workover costs and greater deliverability throughout the life of the well, wh~ h will extend the economic limit of these wells. That will account for increased recovery. If the drive is water drive, increased recovery will result from improved sweep efficiency. The' electric log analysis indicates that the pro- ductive sand members have porosity .bearing from 22 to 36%, with the average about 28%. .Water saturation by electric log calculation averages about 40%. Other pertinent reservoir data are included on Attachment No. 1. Core dar are not available from which to obtain permeability ,, measurements, but this measure of the quality of the sand 'is otherwise determinable from test data. Attachment No. 6 to Exhibit No. 9 shows a calculation of the permea- bility of the sand in State 18740 Well No, 1 between the depths of .4140 and 4160. This calculation is by Darcy's radial flow equation. The calculated permeability is 180 millidarcys. This permeability is indicative of a good quality gas reservoir. The .permeability could be much less than 180 millidarcys and still be indicative ~,,~,~,~ Div.- ~f~M & Marls ,~~ Inc. wl~h fix, und~'~t~ndlng #~t It rmy be mtm~u~ lq, Ir~h,r-ccm~nY u~ o~ly. l~ & ~ COURT RE, PORTE, RS WI~$T £1~HTI"I AV~NIJE~ ~ SI.liT 277.,~715 ANCHORAGES. ALASKA 10 11 12 14 15 16 17 18 19 2o 21 23 of a good quality gas reservoir. Turning now to page three, it has been Phillips' experience in good quality gas reservoirs that one well properly located would ultimately drain the entire reser- voir. Additional wells are necessary only from the standpoint of protecting correlative rights or establish- ing enough deliverability to deplete the reserves in a reasonable period of time. The tertiary system sand reserves should be sufficient to supply the available market for a period of twenty to thirty years. This is a normal depletion period for gas fields. Attachment No. 3 to Exhibit No. 9 details market data. Of course, we don't have any correlative rights problem because 'this is a unit operation. The~ clUster pattern was devised to both maximize recovery and to insure a maximum delivera- bility for the longest period of time. It is cncluded that the cluster pattern could provide about one and a half time as much initial deliverability as could be obtained from wells located on a regular pattern in the center of their respective sections. The technical reasons that' result in this conclusion are included in the appendix. Now if drive is by volumetric depletion or pressure depletion, this same ratio of one and a half should apply throughout the producing life of the field. But if a water frive develops, the cluster I ~,.~-,.~,~ Div:'6f"~4 & Marls L.I~ i~tlc~i Inc. wll~ I~e uf~Kt~tencling ~ It m~y be ~ ~o~ InNK,~nt~ny UN only. R & R COURT RI~PORT£R$ 277-4713 ANCHORAOM, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 22 23 pattern will continue to have a high deliverability for a maximum period of time, whereas a regular pattern will decline at 'a fast rate due to wells watering, out. With the regular pattern and a water drive all but three wells would water out before gas contract commitments could be met, and it would be necessary for Phillips to reappear before you and ask permission to drill additional wells on. the crest of the str~cture' probablt at the same locations within the cluster, Turning to page fOur, because of the location of the North Cook Inlet Field, operations are' expected to be very costly, and it~is essential to the economic develop- , ment of the field that the cluster spacing pattern be approved. In addition ~to permitting development of the maximum deliverability possible, it should result in a minimum investment savings of almost' three million dol- lars. Attachment No. 7 develops this figure. Wells drilled in the cluster pattern will efficiently and economically drain the entire reservoir. It will be note~ that the application requests permission to drill up to fifteen wells in the patterns prescribed. At this time it is unknown how much deliverability will be developed with each full interval well. The deliverability forecas~ included as Attachment No. 4 ~to Exhibit No. 9 was based on the premise that each full interval well would be & R COURT R;'PORTI:'R$ WEST EIGHTH AVENUE ~ SUITE 277-4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 22 23 24 25 A A - 22 - at least as good as State 18740 No. 1 in the interval 4140 to 4180 feet. If more deliverability is developed by full interval a well than is presently premised, fewer than fifteen wells will be required. Rule 2061.2 of the Alaska Oil and~Gas Conservation regulations pro- vides that in the case of unit agreements, governmental boundary lines between units.may be disregarded in establishing spacing, provided the wells are drilled. on 640 acres or on any other well spacing approved by or'er of the Committee. Now this last paragraph on page four is a summary paragraph and it simply calls attention to the fact that the spacing pattern will permit development from one platform, making development economically feasible and it will assure that the maximum ultimate gas production will be recovered with the minimum number of wells required to sUpply the available market for gas. In addition, it requests that spacing be established before. Mr. Chrisman, is the economic data indicated on an Attachment to Exhibit No. 9 as to -- Yes. -- the savings you anticipate from this cluster spacing as opposed to a regular grid spacing? Yes, szr. That's on Attachment No. 7 and these are minimum savings. They include the addition of one R & R COURT RI-'PORTi~i~S 825 WEST EIGHTH AVENUE -- SUITE 277-4713 ANCHORAGE, AL. ASKA 10 11 12 14 15 16 17 18 19 2O 21 25 satellite platform. We might not be able to get up with that. how much savings does Attachment No. 7 indicate that you will be provinced by this spaci.ng type? Oh, approximately 2.8 million dollars. I think the exact figure is $2,785,000.00. Of course, 'if we have to go to the regular spacing pattern, we estimate the initial deliverability would be less by about a third. This would result in our having to install more compressors earlier in the life of the field to meet our market obligations. Do you have anything further on Exhibit 97' No, sir. Your 'next exhibit then? Exhibit No. 10 is another narrative exhibit I would like to follow more or less. The 'permeability of the sand in State 18740 No: 1 over the interval 4140 to 4180 was cal- culated vy Darcy's radial flow equation for a flow rate of 8700 mcf per day, using the average radius of the reser- voir as the effective radius of drainage. This calcula- tion is included as Attachment No.~ 6 to Exhibit No. 9. Using this value for permeability plus the same flow rate and the same producing and base pressure, different values for the effective radius of drainage were substi- tuted into the Darcy's radial flow equation and solutions & R COURT REPORTERS WEST EIGHTH AVENUE -- BUITE ~ 277-4713 ANCHORAGE. ALASKA 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 were obtained for the corresponding values of reservoir pressure. You'll note the little table that follows that statement, and on the far left it shows the value chosen for the effective radius of drainage. The column next to the one on the farthest right shows the pressure at that distance from the well bore and the farthest column on the right shows the change in pressure from the well bore to that point out in the reservoir. Now this table demonstrat that the largest pressure drop, over 50~/~, is sustained within a hundred feet of thr well bore, 33 pounds out of 62 possible. It also indicates the reason the shape of the proration unit ~is not of great consequence. Note that there is only a four pound difference from fifty-one pounds to fifty-five pounds when your effective radius of ~rainage has doubled from a half mile to a mile. Now there are many proration units oblong in Texasm with length being twice width. In Louisiana the proration units are even more irregular. They often follow the boundaries or the indicated boundaries of the productive limits of the reservoir, and they'll turn out pi'e-shaped and every other shape, and it's usual in.~.Louisiana for a well to be permitted at the most favorable location in a nit area or that proration unit area. This table indicates one more thing of interest on page two. That the incremental pressure difference from effective radii [ ~,~,~.~,~ Diw.' of'~ &Marls Inc. wiff~ tt~ L,~Je~St~K~t~ tt~t # m~¥ be r~:)~duc&d for Intet.4:om~ny uN 0nly. E COUET EEPOETERS 277-4713 ANCHORAGE, ALA$,KA 10 11 12 14 15 16 17 18 19 2O 21 22 23 25 - 25 - I ~l,~,l,~;~ Dixr.' of'M &Marls R & R COURT RE:PORTE:RS 81Z~WE:ST EIGHTH AVI:'NUE ~ SUITE: I~ 277-4713 ANCHORAGE, AILASKA of drainage of one-half mile and 15, 600 feet about tkree miles is no more than the incremental pressure difference from effective radii of drainage of 545 feet and one-half mile, eleven pounds in each case. Now I don't have a wall exhibit. I drew this out on a little plat last night. Here's the most remQ~e point on the productive 'limit. This is the nearest well bore to it in the cluster pattern. A half mile away from that to the most remote point on the productive limit there's an '~elevn pound pressure difference. Going in the other ., direction there's an eleven pound pressure difference in a half mile.to 545 feet up from the well bore. Now a square proration unit 1090 feet on the side wh&eh is twice 5.45 feet would contain only about twenty-seven acres. Inasmuch as 'gas expansion is directly proportional to pressure drop, gas at the most remote productive limit will flow to'a,point one-half mile from the nearest cluster well just as re'adily as gas on the perimeter of a 640-acre unit will flow to the twenty-seven acres located at its center. What this says ia that the conse- quence of going to a cluster pattern from a regular patter' of 640, acres would be comparable to those in going from twenty-seven acre spacing to 640 acres spacing. I hope you don't misinterpret me; I'm not making an argument for twenty-seven acre spacing. 10 11 12 13 14 15 16 17 18 19 2O 21 A ( i - 26 - Because this discussion relates to a particular instant in the life of a well in the reservoir over an extended period of time there is no unfavorable consequenc whatsoever, as additional pressure drop will occur at the well bore and a responsive drop will occur throughout the sands with the final result that the average reservoir pressure at depletion will for all practical purposes be independent of spacing and well geometry so long as the depletion period is kept constant. As a result, if there is'-ever any advantage by regul.ar spacing over an ultimate plan it will be an instantaneous deliverability. But Exhibit No. 9 indicates that the deliverability for the cluster patten would be higher than the deliverability for a..regular pattern. Mr. Chrisman, do you have two examples of gas fields in other areas with which you are familiar? Yes, sir, I have those. They're included in Exhibits 11 and 12. To this point in my testimony, what has been related to you concerning the ability of the wells to drain large areas has been based on theory or statements with respect to Phillips' experience or the experience of others. The next two exhibits show examples of this experience, Now in looking at these exhibits bear in mind that gas withdrawal at a well causes a responsive pressure drbp in,the reservoir around the well bore. Wherever that R & R COURT REPORTERS WEST EIGHTH AVENUE ~ SUITE ,, ANC:HORAGE, ALASKA 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 - 27 - pressure drop is felt, the reservoir is being drained. Exhibit No. 11 consists of a plat of a portion of pecos County, Texas containing the Packett Ellenberger gas condensa~ field and a table showing certain pressure and production data on oil in this field. These wells, after stimulation, are comparable in open flow potential to State 18740 No. 1. Phillips discovered this field with its Glenna No. 1 well. This well is encircled on the plat -- you'll find it at. about this position on the pag-e. Data relating to Glenna No, 1 on the table is under lined, right near the top. You will note that the origi~a bottom hole pressure of Glenna NO o 1 is 6813 pounds. 6813, the original bottom hole pressure. You might just , conside..r the data given here on Glenna No. 1. In the first column it shows the original bottom hole pressure of '6813. This welI went on production during 1952, shown in thee? second column. Skipping over to the fourth column the bottom hole pressure of mid-year 1955 is shown of 6672 pounds; additional pressures at mid-year of various years through 1960 are shown following the -- the line to the right. In the last two columns production data is shown at mid-year of 1959 and 1960, this production data accumu- lated volumes of gas, mcf. Now the table also -- also shows the same data on all other Phillips wells. You'll notice that there are fifteen of those if I can count cot- , . R & R COURT REPORTERS B2~ W£BT £1GHTH AVgNUg -- SUITS S 277-4,713 ANCHORAGE:, AL. ASKA 10 11 12 14 15 16 17 18 19 2O 21 rectly. That's correct. The table shows the original. bottom hole pressure for competitor-drilled wells and in parentheses for most of those wells the year in which these wells were completed. Also the year in which they con~nenced selling gas and the bottom hole pressure at mid-year of that year. Are you following that? If there's a question on that, Why, --- now looking at the original bottom hole pressure column, no well drilled subsequent to Glenna No. 1 has a' bottom hole pressure as high as the original bottom hole pressure. Now let's look at Gulf's Robbins A-4. It's shown by a check mark' on your mapr up near the upper lef~-hand corner, and the data relating to it is also underlined on your table. You'll. note that it Was completed, the year in parenthesis during 1957. Upon completion it had a bottom hole pressuz , of 6571 poUnds. It's considerably below the initial bot- tom hole pressure for'eht ereservoir of 6813 pounds. Now this well, the same as other.wells in the field, didn't start selling gas immediately; it wasn't connected until 1960. During this period that it was not connected, the bottom hole pressure continued to decline as a result of other wells in the field selling gas. The bottom' hole pressure at mid-year in 1960 was 5927 pounds. Now those two pressures, 6571 in 1957 you'll note comparies quite favorably to the Phillips well pressures in 1957, and the Pub~c*tk,~ Ir~ with ttm unc~r~ndl~l ttmt it n~y ix r~roduced ~ ~.~.m~.F u~e cmly. R & R COURT Ri~PORT£R$ 277-47 ~ 3 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 22 23 25 m. 5927 pounds in 1960 also compares quite favorably. This is one of the best illustrations which is why I picked it.1 If you'll follow down through the list you'll find that/i the original bottom hole pressures for practically every well correlate quite well with the pressure of the Phillips well at the same time of completion of the new wells. What this does is demonstrate, that the Phillips wells were draining the entire reservoir. Now all the Phillips wells were located in the south half of the productive are~. I guess you might say we had a whole cluster right , there, didn't we? We have another exhobit. I might show you that one. Twenty sections, which is more than the entire productive area of the tertiary sands interval in Cook Inlet, have been drained, and this is a poorer quali~ reservoir, before stimulat~m,~ than the sands in Cook. ~ Inlet are. Now Exhibit 12 isa map of Texas County, Oklahona. MR. KUGLER: Can I ask one question? Is that dolomite production?. That is dolomite, sir. This map of Texas County, Okla- homa contains a portion of the Guymon-Hugaton dry gas field. Exhibit 12 ~also includes two other sheets that I want to discuss in some detail. Now the wells in this field, even after stimulation, have a deliverability ~ much R COURT RI~PORTER5 277-,4713 ANCHORAGE, ALASKA 10 11 12 13 14¸ 15 16 17 18 19 2O 21 22 23 25 lower than what we expect the average well in the Cook Inlet Field,producing naturally, '. i~O. have. I think the exhibit itself will illustrate that.. Note on the map the dashed square ~n its approximate center. This is the equivalent of one township or thirty-six sections, and it is the area shown on the following sheets which are fr,;om exhibits presented by Phillips before the Oklahoma Corporation Commission. These exhibits prove that drainage had occurred in seven undeveloped sections which are'marked with "X's" on page 2, 3 and 4 of the second: sheet of the exhibit. You'll find this all bmch~d down in the lower left-hand corner. The Cause number and period during which this hearing was held are found in the lower left-hand corner of the second sheet. ,Now on Plate No. 2, the second sheet, each square represents a section and in most sections there are three numbers. The upper number is the initial shut-in tubing pressure of the well, the m~tddle number is the date of the corresponding deliverability test, and the lower figure is the initial deliverability. Now note that in 1943 the pressure and in three of four wells which were completed was about 420 pounds. These quarter sections have been checked with check marks. One well had a lower delivera- bility and . .pr,.o. ba. hly had not built up to static pressure at the time the pressure was read~ It had a pressure R a R couR'r R~'~o~'r£~ 82~ WEST EIGHTH AVENUE ~ SUITE ~ 2'77-4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 22 24 25 - 31 - recorded at 371 pounds. Wells completed later had success~ ively lower ~initial pressures.. By 1952 when the seven wells with the "X's" were completed their pressures were about 330 pounds. I think they ran from 323 through 340. Now look at Plate No. 4 on the same sheet. The pressures of the seven wells with "X's" in their sections -- this is the same mark recorded up on Plate 2 -- compare quite favorably to the pressures of those wells to the east i'n 1952, and are almost a hundred pounds below the 194] pressure of 420 pounds. This indicates that the seven sections that comprise about 4500 acres have been drained by other wells in the' field. Now on Plate 7 on the third sheet in the lower left-hand corner it will be the pr e s sure s noted that five years later/had all declined on the order of fifty pounds additional, and for all practical purposes ,, were identical to one another. The allocation formula , .then in effect ,permitted production during the five year period in the amount Shown in Plate No. 5. Notice there's quite a variation in the amount, of production taken from these wells.. Phillips used th~sedata in a successful effort to get the allocation formula revised. Phillips was opposed by the purchaser and most of the principal operators in the field. In fact, we didn't have anyone as on our side. But the evidence left no dOubt/to the fact that drainage had occurred and that correlative rights R COURT RI:'PORT£RS WI~ST I~]~HTH AV~NU~ -- ~UIT~ 277-4713 ANCHORAGE, ALASKA 10 11 12 13 14 15 16 17 18 19 ¸2O 21 Q A were being violated. The Oklahoma Corporation Commission acted properly and granted relief. Now these are two actual appeal cases proving that large areas developed late are drained by wells completed earlier and ad. jacent portions of the field. Additional examples have not been prepared for you but .this is exactly what the theory indicates should happen, and it does happen in every gas field in which we operate. I haven't seen an exception yet and I don't expect to. At this point let me state that I firmly believe that statement which is included in Exhibit No. 9 that one well properly located would ultimat ly drain an entire reservoir. The only reason for drillir~ more wells is to protect correlative rights which are not. a problem in Cook Inlet or to establish sufficient deliverability to deplete' the field in a reasonable period of time. Mr. Chrisman, Exhibits 11 and 12 have sevred to establish that wells in a good quality reservoir as is the North Cook Inlet Field will drain over large areas. Do you know of any examples of cluster spacing in other areas and other producing regions similar to that which is requeste~ by this application? Yes, 'sir, I do. Prior to being assigned as senior reser- voir engineer to Phillips Western Region area, doe ten years I had a comparable job comprising our Gulf Coast & R C;OURT REi~ORTERS WEST EIGHTH AVENUI~ ~ SUITE 277-4713 ANC:HORAGE, ALASKA '. e~ 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 25 Q - 33 - area. In the Gulf Coast area and offshore Louisiana we had large Federal Leases, generally a quarter of a block to one block which is 1250 acres to 5000 acres, and it is common in that area for one opera'or to have most, if not all, of an entire field under lease, one or two or three blocks. Now, it is common in .offshore Louisiana to define a field by wide --widely spaced wells and then to locate subsequent wells at the most favorabl-e point on the structure. In my experience,. I observed two Phillips interest fields, gas field, being developed in this manner One is in the block 28 Ship Shoal. area. Phillips has abou 405 interest in a Federal unit, that is developed with a cluster pattern. Specifically it is not wells located in a dircle but the wells are bunched at the top of the structure. Another example of a Phillips 'intereSt field developed in this fashion is the Vermilion block 39 which we call Rollover Field. We have 2500 acres in a com- petitively developed field. Practically all .of the 2500 acres are prodUctive and our three wells which deliver about sixty million a day are all located in the northeast corner, northeast quarter, of that 2500 acres. There are other examples which I have per. sonal knowledge of. Mr. Chrisman, from your personal knowledge and familiarity with those other fields, is it your opinion that those fields are being efficiently and economically drained R & R COURT REPORTERS 82S WEST EIGHTH AVENUE -- SUITE S 277-4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 2O 22 25 A A Q., A without waste by such a ~pa¢Ti:n~ pa.t:ter~? Yes, sir, they are. Does Phillips Petroleum Company have a market and has it committed the gas to be produced in these fields to a market subject to governmental approvals? Yes, sir, it does. Is it your.opinion that the increased deliverability which will be obtained, by this cluster spacing pattern is necessary to fulfill the Commitments made by those sale contracts? Yes, sir, it is. There is an alternate to this, of course and this is to install expensive compressors earlier in the life of the field. Mr. Chr. isman, in summary is it your opinion as a petroleum engineer and from the study y..ou have made of the North Cook Inlet Field that the cluster spacing pattern which is sought by this 'application will effi~ntly and economically drain these three gas reservoirs without waste? Yes, Slix.i~:it is. MR..JONES: That's all the questions we have of this witness. MR.'WILLIAMS: Mr. Marshall? MR. MARSHALL: Mr. Jones, perhaps I ought to address my question to you because I believe it would involve bOth of your witnesses. The question just has come to mind from looking at R & R COURT R~'PORTI='R~; 825 WEST EIGHTH AVENUE -- ~,UITE 277-4713 ANCHORAGE, ALASKA 10 11 12 14 15 16 17 18 19 gO 21 23 Your map of your cluster spacing. Is there a possibility that there would be gas in the reservoir, especially there in the nort~- east portion of the field, that Wouldn't be drained by your cluster system? My question I think would have ge ol og ica .1 impli- cations because of the possible lack of permeability of discon- tinuity of, permeability between your northernmost cluster spacing of wells and the nerthernmost limits of your productive limits. MR. JONES- Perhaps Mr. Vigoren should reply to you on this. We do have pressure information. However, on the shallow well drilled up here, the Pan Am~ well, and these two wells have the same .pressure for all practical purposes, so pressure-wise, they appear continuous. Mr, Vigoren, could you try and answer Mr; Marshall's question, please? MR. VIGOREN- Yes, sir. In addition to that, the studies that we~ve made in the field indicate that the reservoir is continuous over the structure and of course we feel like you can project it on that distance north that you were speaking of. MR. MARSHALL: Mr. Vigoren, do you have any indication that there could be transverse crossing across that north end which would isolate the gas production from the cluster? MR. VIGOREN: No, sir, not at this depth, we don't have MR..JONES: I think perhaps also, Mr. Marshall, I should point out that we do have a gas commitment here. In the event that any. & R C:OURT REPORTERS WEST EIGHTH AVENUE ~ GUITE · 277-4713 ANCHORAGE, ALASKA '. 10 11 12 14 15 16 18 19 2O 21 22 23 24 25 Performance indicates that we are not draining the entire reser- voir due to some of its geological features, that are possible but not probable, we must meet this commitment from this field and we will be back in that event asking for permission to drill up on the north end if it's indicated that it's separated. MR. MARSHALL- The spacing Order, if allowed, would be temporary for eighteen months, at which time it would be made permanent or denied at a hearing. Approximately what is your schedule to.pull your first production from the cluster if this is permi~tt~d? MR. CHRISMAN: The first production from the cluster -- this is -- just a moment, let me tell you where we are now. . We're just about ready to order the platform now and we expect , to install it next spring, and we expect drilling about August the 1st. The 1st -- this is of 1968.' The first production will be about mid-year 1969. We will not be operating in full capacity at that time.~ But the~, eighteen months would permit us to ~ in all probability to drill the first couple of wells. MR. MARSHALL: Thank you. That answers my questions. MR. JONES: Thank you, Mr. Marshall. MR. WILLIAMS: Anything further? Questions? ~ Oh, Gilbreth? MR. GILBRETH:~ Mr. Chrisman, if it should develop later that there is an active water frive in any of these stringers would you anticipate drilling at the cr. est of the structure? You I ~,,~,,.;~'~ IDiv-.' Of :~/I & Marls i~ & R ~OURT ~I~PO~Ti~; 825 WEST EIGHTH AVENUE -- SUITE 5 277-4713 ANCHORAGE, ALASKA . , ,j 10 11 12 14 15 16 17 18 19 g0 21 24 have no well apparently at the crest of the structure here. MR. CHRISMAN: Eventually we will -- or we would need a depletion well at the very top of the structure. These tertiary sands are not the only sands that are productive in the partici- pating area however. I mean, the sands underlying the participa- ting area. We have production in a sand at about i1,000 feet. Now that sand will be developed from a vertical hole, plus perhaps deviated holes in addition, but that vertical hole would eventually. be available for a depletion well, covering tertiary sands 'from.'' i' 3500 .to 6200.feet. MR. GILBRETH: I have no further questions.. MR. JONES: Mr. Williams, the Phillips twelve exhibits have been accepted into evidence, is that correct? MR. WILLIAMS: Yes, that's correct, Mr. Jones. MR. JONES: Gentlemen, we hope that we have been able ~o establish that the cluster spacing pattern requested by this application will efficiently, economically and without waste bring the reservoirs as shown within the participating area, that by so drilling the wells 'that we can obtain the increased deliverability such testified to by Mr~ Chrisman, and/increased deliverability is necessary to fulfill our sales commitments. Also a substantial economic saving by drilling in this pattern which will contribute to the feasibility of adequate development, and saving in the approximate 'amount of 2.8 million dollars. If it please the . Committee we think that this is a proper case for the application COURT R~'PORTIZR5 EIGHTH AV£NUI~ ~ SUITE 277-4713 ANCHORAGe, ALASKA 10 11 12 14 15 16 17 18 19 2O 21 - 38 - Of the provision of Section 2061.2 of the Alaska Oil and Gas Conservation regulations that states in the case of unit agree- ments governmental boundary lines within the unit may be disregar- ~ed,pzovided that the wells are drilled on 640-acre spacin, g or any other well spacing approved by Or. der of the Committee. Thank you, gentlemen, it's been a pleasure for Mr. McDonald and me to be here and appear before you today. --- END OF PROCEEDINGS --- & R ¢OMRT RE~PORTi~R$ WEST EIGHTH AVENUE -- SUITE 277-4713 ANCHORAG;, ALASKA PAUL F. ROBISON KENNETH M C:¢ASKEY EBEN H. LEWIS JOHN R. $TRAC:HAN ROBISON, MCCASKEY & LEWIS ATTORNEYS AT LAW 921 SIXTH AVENUE ANCHORAGE, ALASKA 99501 May' 9, 1967 iii TELEPHONE 272-9446 RE: Application of Pan American Petroleum Corporation for an Order establishing a spacing pattern for the production of gas from the North Cook Inlet Fie ld State of Alaska Department of Natural Resources Division of Mines and Minerals Alaska Oil and Gas Conservation Committee 3001 Porcupine Drive Anchorage, Alaska Gent lemen: As Alaska counsel, I concur with the recommendations of .Mr. Swan's letter of May 8 (reference the above), and confirm that I will be unable to attend the hearing because of a Court appearance on be- half of the same clients scheduled for that date. I would assume that the appearance of Messrs. Jones and McDonald as attorneys for the applicant in these proceedings may be duly entered without the necessity of any motion in open hearing to this effect. If a written motion should be required in lieu thereof, please advise me in sufficient time to prepare and file the motion in advance of the hearing. I find nothing in the Rules of practice and procedures precluding the appearance of these gentlemen under the circumstances proposed. However, should there be any cause to' be concerned that the Alaska Bar Act itself requires such motion, it may be feasible to treat this letter as an informal petition for ad hoc admission of Messrs. Jones and McDonald for purposes of the proceedings and to enter my appearance as local counsel associated with them, in order to avoid any question of regularity of the proceedings. Very truly yours, EHL:ek cc: Oscar Swan Pan American Pet. Corp. Denver, Colorado 80202 C. B. McDonald Phillips Pet. Co. 1300 Security Life Bldg. Denver, Colorado 80202 ROBISON, McCASKEY & LE~{I'IS Eben H. Lewis Li Y 10.1967 Carl W. Jones 0~w$~oN o~ M~NsS & Phillips Pet. Co. ANCHORAGE 530-B Frank Phillips Bldg. Bartlesville, Okla. 74003 FORM 497 5 - 65 PAN AMEmCAN PETIIOLEUM C:O P. ATION DENVER, COLORADO 80202 May 8, 1967 Re: Application of Pan American Petroleum Corporation for an Order establishing a spacing pattern for the production of gas from the North Cook Inlet Field State of Alaska Department of Natural Resources Division of Mines and Minerals Alaska Oil and Gas Conservation Committee 3001 Porcupine Drive Anchorage, Alaska Gentlemen: The above matter has been set for hearing before the Committee at Anchorage on May 15, 1967. The Application was filed in the name of Pan American Petroleum Corporation and signed by me and by Mr. Eben H. Lewis, as its attorneys, because Pan American is nominally the Operator under these agreements, however, it was planned that Mr. Carl W. Jones of Bartlesville, Oklahoma, and Mr. C. B. McDonald of Denver, Colorado, attorneys for Phillips Pe- troleum Company, would represent the working interest owners under the North Cook Inlet Unit Agreement and Unit Operating Agreement. While neither Mr. Lewis nor I intended to undertake to present the Applicant's case in this matter, we did intend that one, or both of us, would be present at the hearing and enter our appearance and that of Mr. Jones and Mr. McDonald. The setting on May 15, 1967 makes this impos- sible. Each of us has a prior setting of another matter. Mr. Lewis will be in court in Anchorage, and I will be appearing before the Utah Conser- vation Commission. This letter is to advise you that Mr. Carl W. Jones and Mr. C. B. } McDonald are authorized to appear as attorneys for the Applicant in the / REC.FIVE .0 I.,iAY 10 1961 DIVISION OF MINES & MIIXlERAI.$ ANCHORAGE State of Alaska May 8, 1967 Page 2 above matter, and to request that their appearance as such attorneys be entered therein for all purposes. Yours very truly, PAN AMERICAN PETROLEUM CORPORATION Oscar E. Swan, Attorney OES:mn CC: Mr. CarlW. Jones Mr. C. B. McDonald Mr. Eben H. Lewis , ANCHORAGE · , STATE OF ALASKA, ) THIRD JUDICIAL DISTRICT, ) ss. being first duly sworn on oath deposes a.nd says that...-s...~-.,e. ..... is the...1..e..c~-a..[----(;:-~.~r.k., of the Anchorage News, a daily news- paper. That said newspaper has been approved as a legal news- paper by the Third Judicial Court, Anchorage, Alaska, and it is now and has been published In the English language continually as a dally newspaper In Anchorage, Alaska, and it is now and during all of said time was printed In an office maintained at the aforesaid place of publication of said news- paper. That the annexed is a true copy of a...1--e-.c&a-.~...D.-°-.-~--$.g.~....# 224 as it was published in regular issues (and not in supplemental form) of said newspaper for a period of ...... -O.~.~ .... insertions, commencing on the ..3.~'.(;:]...day' ' of ......... .~.~..~ ......... ,19 ...~.?.., and ending on the ....... ; ...... 3r.~ay of of ........ l~,ay. ......... i ..... 19...6.7, both dates ·inclusive, and that such newspaper was regularly distributed to its subscribers dar- ,' lng all of sa.id period. That the full amount of the fee charged for the foregoing publication is. the' sum of $....~?...,~..0..0..... which amount has been paid in full at the rate of $1.50 per square. Minimum charge $7.50. One in- sertion legals, $2~.u-'persqua~.e',,'~" -- - hn . Subscribed a. ndJsworn to before · ' 3~!/-/ ~ , me this ....~.'--~y of.:.'..,"~Y.,. ........ -. :i .... "':" ": ' "'~':: . And~orage, MY ¢ON~I~ION EXPIRES Oct. 16, 1967 _._.._..__ ...... _.___.... ....... , 19..-..- · NOTICE OF 'PUBLIC HEARLNO STATE OF ALASKA DEPARTMENT OF ' I~ATURAL RESOURCES. DIVISION OF · :I~IINES AND MINERALS OiI and Gas Co.nscrvation Cornmi~c~ , . Notice is hereby given ~ha~ ~he Pan American Petrc.leum Corpora- 5on has requested'the Alaska Oil ~nd Gas Conservation Committee issue an order of exception to Sec-' tlon 2061.3, AAC, Title II in'accord, anco with.' procedures described AAC, Title II, Section 2081.3 es%ab, llshing temporary spa.ring effcc~ in'g the development c.f ~he North Cook Inlet Field Tortiary Systera... Initial Particioating Area of the North Cook Inlet By a. "cluste~' spacing pattern., .The vertical inte~ vms effected by this. request are lhe ~er~iary gas sands as typically indicated behveen the depths ~,500' and 6.200' in the North Cook Inle~ State 175B9 Well No. 1. '- Thc Initial Participating Area of ~he North Coo,k Inlet Unit ts eribe~ as follows: Town'ship 12 North, ~ange Township 11< North,,',Rm~e 5 'We~ Section ~: N/2 ~ Township ~ No~h, Rang~ I0 West Section. B5:SE/4 ..... Township ~1 ~o~h, Range 10 E/~ .'." .. ,~. . Township 12 North, Range We~ Section 31: Ail Section 32: . . To-~nshlp 1~ ~orth, Range 9 .I., West ,Section 5: AIl Section 6: All Section 7: All Section' 13: ~:. N/'2 .' '. r' ' ~ ~'<'. Township 11 ~0~';" ~.;,ng~ I0 Wzs~ Secilon 12:Al1 Section 33: N!~ _ ,. 28: W,'~ The temporary order, if would continue In force for · od of no~ more . than eighteen' .. months, niter which 'a hearing shall be held at which time the Com- mittee will consider such evidence-, as will enable It to determine the . permanent'field apacing." ',' ' '' .. ' A public hearing "on this' mat~er will be ~neld at the City Council Chambers tn the basement of the Z. J. Loussac Library, 5th and F.': Streets, Anchorage, Alaska, at 9:30 a.m., May 15, .1967,' at which time . the' application will be presented' and protestants and others may hoard, ,, · Thomas R. Marshall, .Jr. . ' Executive Secretary " Alaska Otl and Gas .' .': ' C6nservation Committee~''' ,.' ,Anchorage Alaska ggS04 .... ,,'.:,.~ , , . ~., , , , ,..' ,.,.j-~l Publish: M~y 3, .1~67.'/ '('r"~ ?; ,i'~'..'..,:':?[~'" Legal Notice',No.. 33{ :'j '~ ? ,' ?, Town~h:p I: 3,Torth, Range 9 : · %'e.~t Sec:tun I~: SE/4 Section ~,0f Iq~/4, S12 Section 29: Section 30: All: . . .. Towns:dp 1~ Neff:h, Range %'est Se~lien 2~ .SE/4 Section ,' ~: All ....... .. J' Township ~1 North,' ~ang~ ':1~ ", " ], Wes~,Sacflou i:' All' ) . · ', 10~J 2J X ~ ~o~zx. AFFID,-.VIT OF PUBLI(',. TION STATE OF ALASKA, ) THIRD JUDICIAL DISTRICT, ) ss. ....... }~:~r.y....S.eawall .............. being first duly sworn on oath deposes and says that_._~]l¢_ ..... is the..!.e.~a.l...clar]~u., of the Anchorage News, a daily news- paper. That said newspaper has been approved as a legal news- paper by the Third Judicial Court, Anchorage, Alaska, and it is now and has been published in the English language continually as a daily newspaper in Anchorage, Alaska, and it is now and during all of said time was printed in an office maintained at the aforesaid place of publication of said news- paper. That the annexed is a true copy of a l.e..~a.l...n.Q.~i.c~....# 224 as it was published in regular issues (and not in supplemental form) of said newspaper for a period of ..... .o..~.~ ..... insertions, commencing on the 3r.d .... day of ........ ~.~._~ .......... ,19 ..~..7.., and' ending on the ............~:r'Z]day of of ....... ~')~ ................. , 19..6.7.., both dates .inclusive, and that such newspaper was regularly distributed to its subscribers dur- ing all of said period. That the full amount of the fee charged for the foregoing publication is the sum of $..~.~.,.~.~ ..... which amount has been paid in full at the rate of $1.50 per square. Minimum charge $7.50. One in- sertion legals, $~,00 per square. Su6~;~'~,~' sw~-%rn to befor~'~'~--'"~ me this :..~5~day of..~ .......... , 'NOTICE ?~,PuBLiC Off and'Gas Co~tl~ C~ml~ee '. . ,,..,' . ; . N~tl~e'' tS' Petre~eum the USh: ~pac ,als he... ~lrldJ ! 3,500:.~a~.d: 6.~00' ~Inle~' -'State 17589 I3FO' .potAtO., ,, ~ ~.~, , . In!.~t'~..:~F. 'a..."cluS~e~' e rn,~F~fe ?erflc'al ~ ~w~en "~[he'" 'de~s o~ NOrth ' Cook NO.' i',"" . .., We~'. Section .ownshlp. li. ?ownsMp. 1! ~oith;. ~e~. Seott~ 2:" ~/~ We~ ~ec~lon. 3~. Ail Section All .... . ·" ,,,. ,',. ,t ' . 'i~"~" . ' J 'l'he temporarF order, if allowed, JWould ,cOntinue ~ 6d ,~f' ~Ot ;more ~Jh~ :'~i'l~h~en ~b~'~'~ ~,', whisk"" t~e" .... the".z Com- .,~ ,~,., :. .... ,......~.., , . ..~... ,. ....... , ~ · . ~s :-~1. ~Ble. i~ .~ ¢~e~e the Notary Public in and for the State of Alaska, Third Division, Anchorage, Alaska MY COMMISSION EXPIRES O.ct~ 16, ].967 RECF!VED I/AY b 1967 DIVISION OF MINES & MINERALS ANCHORAGE .,dO0 10~3X NOTICE OF PUBLIC HEARING STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCES DIVISION OF MINES AND MINERALS Oil and Gas Conservation Committee Notice is hereby given that the Pan American Petroleum Corporation has requested the Alaska Oil a%d Gas Conservation Committee to issue an order of exception to Section 2061.2 AAC, Title II in accordanc~ with procedures described in AAC, Title II, Section 2061.3 establishing temporary spacing effecting the development of the North Cook Inlet Field Tertiary System Initial Participating Area of the North Cook Inlet by a "cluster" spacing pattern. The vertical intervals effected by this request are the Tertiary gas sands as .typically indicated between the depths of 3,500' and 6,200' in the North Cook In~ t State 17589 Well #1. The Initial Participating Area of the North Cook Inlet Unit is described as follows: Township.,12 ~q~.th.,.....Rang.9 9 West Section 33: NW/4 Township. 11 North, Range ..9 West Section 8: N/2 SW/4 Township 12 North, Range lOWest. Section 35: SE/4 Township 11 North, Range 10 West Section 2: E/2 Section 11: E/2 Township 12 Nort. h.~ .Ranse.~9 We, st Section 31: Ail Section 32: All Township ll..Nor.~ Range 9 West Section 5: All Section 6f All Section 7: Ail Section 18: N/2 Township 11 North, Range 10 West Section 12: All Section 13: i~t/2 Township .12 Nor. th~ Range 9 West.. Section 21: W/2 Section 28: W/2 Township 12 North: .Range 9 Wes_t Section 19: SE/4 Section 20: ME/4, S/2 Section 29: All Section 30: Ail Township 12, ..Npr. t.h~ Ra. nge .10 West Section 25: SE/4 Section 36: Ail Township ~1. North, Range 10 Wes.~ Section 1: All The temporary order, if allowed, would continue in force for a.period of not more than eighteen months, after which a hearing.shall be held at which time the Committee will consider such evidence as will enable it to determine the permanent field spacing. A public hearing on this matter will be held at the City Council Chambers in the basement of the Z. J. Loussac Library, 5th and F Streets, Anchorage, Alaska, at 9:30 a.m., May 15, 1967, at which time the application will be presented and protestants and others may be heard, Thomas R. Marshall, Jr. Executive Secretary AlaSka Oil and Gas Conservation C~mmittee 3001 Porcupine Drive Anchorage, Alaska 99504 Publish May 3, 1967 T TEXAS CO.~ OKLA. GUYMON HUGOTON FIELD I - 36 Wells (" Group Plate 1 6 5 4 3 2 1 7~ 8 9 16 11 12 ., ~18 17 16 15 14 13 ,, , 19 20 21 22 23' 30 29 28 27 26 25 ,, , ,, , , 31. 32 33 34 ..35 36 Well Location Plate 2 11-45 7-45 7-45 7-45 7-45 7-~5 '.~ 11-~5 11-45 8-43 8-43 9-b6 2-52 11-~5 7-~5 ~43 8-b9 5-46 Z7~' j, ~'7~ &75-i l~,Vc :'~Z~--~ 2-52 2-52 1-~7 8-46 8-~3 5-~6 ~o "'~ 4 3~ Xffz7 z~ ~o~sr 37 2-52 1-52 1-47 5-46 8-43 ?'~5 ~Yff/' X 327 No~sz ~9" ~ 37,1 1-52 1-52 3-~6 10-46 10-46 9-46 Date of Initial Deliverability Test x-First Production - 1952 1.32 1.96 3.72 1o85 1.85 2.86 . 1.89 1.99 8.66 4.g~'~ 2.80 1o80 0.08 2.31 5.10 8.24 2.84 1.76 0.13 0.07 1.20 1.03 4'32 1.22 , , , 0.08 0.11 1.92 2.11 4.59 3.03 . X 0.11 0.17 2.49 1.34 3.54 1.16 , , , / Plate '329 322, 317 317 316 315 324 330 31~ 316 316 317 340 325 '318 317 ,322 322 335 323 323 325 322 325 334 327 328 323 326 324 331 327 326 323 322. 323. _ , -- ProductiOn to 6-30-5%, Bcf 1952 SIP, psig Group I - 36 Wells(" Plate O.61 O.51 1.40 0.92 0.39 1.10 0.73 0.80 1.38 1.15 1.63 0.62 · 0.78 0.97 ~2.16 1.71 0.81 0.78 0.98 0.91 0.95 0.56 0.57 0.55 0.91 1.00 1.38 0.85 0.5/+ 1.07 0.97 1~/+5 0.9/+ 0.72 2.04 0.63 Production 6-30-5~ ,to 6-30-57, Bcf Plate 7 286 281 278 278 278 277 279 286 276 276 277 278 · 28/+ 279 276 277 281 282 · 282 278 279 281 281 279 282 279 279 279 283 280 . 280 278 279 279 278 280 Plate 6 797 120~ 1635 1374 1932 835 921 1138 2236 1862 1073 1033 , , ll3~ 1136 1195 697 7/+5 544 1081 1165 1663 lO14 668 1268 948 1698 1029 875 15/+6 794 1957 Deliverability, Mcfd Plate 8 10 5 2 2 2 1 _ , , . ~, , , ,,~ _ 3 10 ,0 0 1 2 8 3 0 1 5 · 6 .1 · 6 2 3 5 5 3 6 3 3 3 7 · , .. , _ · /+ 2 3 3 2 1957 SIP, psig 1957 SIP Difference PUCKETT ~F ~ER FIELD PeCo s County, Texas Operator Original Lease BHP-Psia Phillips Evelyn jo #l ' 6705 FiSher Bonsack #l 6702 Glenna #l 6813 Glehna #2 6640 Odom A ~l 6539 Od~ C ~l 6639 Od6m E-#1 6134 Puckett... C ~l 6692 Puckett D #1 6704 puck~tt E #1 6800 Puckett K #I 6691 Puckett L #I 661~ Robbins A #1 6649 Rosa A #l-' 6165 Rosa Mitchell #1 6379 Atlantic - Robbins l~A - 6369 Rosa Mitchell State 6220 APCO - ' Eo R, Moore 6312 Jo Wo R0bbins 6417 Standard of Texas Mitch Mitch Roark J.W. J.W. J.W. Thom Unit #l (1958)6232 Thom Unit #2 (1958)6303 (1959)6059 Robbins #l (1957)6431 Robbins #2 (1957)6372 Robbins #4 (1959)6263 R. Lo Mitchell.~#l (1959)6349 Gulf _ ~ --- Fisher Bonsack ~ J. W. RObbins A~#1 (1956)6528 J. ~o R°bbins A #2 (1956)5874 ~. ~o ~o~ins ~ #4 (1957)~57~ J°' W° Robbins A ~5 ~(1958)623I J. Wo R0bbins A ~ (1958)6203 J. Wo Robbins A ~7 (1958)6263 J W. R°bbins A #8 (1960)6114 J~ Wo Robbins A #9 (1960)6028 J° W. Robbins A#10 (1960) 5849 D~e First Gas BHP Midyear Connected 1954 1954 I952 1955 1954 1954 1958 1954 1953 1954 1954 1955 1955 1959 1958 1955 1959 1958 1957 6376 6499 1958 1959 1960 1958 1958 1959 1959 1960 1960 1960 1960 1960 1960 1960 1960 1960 1960 6224 (1960)5969 6183 5407 5776 5663 5927 592o~ 5891 5916 6101 598O 5938 BHP - Ps ia at Midyear 1955 ,1956 1957 1958 1959 1960 6604 '6606 6478 6346 6131 5909 6658 6622 6500 6346 6088 5952 6672 6637 6540 6360 6133 5917 6640 6520 6487 6360 6107 5975 6470 6484 6344 6243 5991 5787 6611 6607 6469 6293 6002 5873 5856 5847 6677 6612 6518 6349 6160 5907 6665 6621 6522 6374 6154 5900 6660 6614 6418 6327 6071 5891 6660 6607 6515 6341 6129 5931 6609 6602 6494 6367 6051 5896 6661 6603 6487 6357 6133 5946 6O7O 5801 6316 6023 5913 Cumulative Production Midyear - Mcf 1959 1960 13,688,891 14,523,576 8~813,598 5,934,161 9,310,820 13,548,133 1,861,119 11,972,421 15,111,545 14,342,978 14,349,601 7,583,778 11,720,081 811,835 6,128,784 17,439,092 18,340,347 11~168~912 7,680,758 11,732,781 17,263,011 4,317,254 15,478,765 18,922,530 17,944,302 18,085,845 9,787,840 15,489,456 2,5?2,002 9,?42,283 .... BLK. 12~ ~.,, E.L. & R.R. Tex~s G,Af ~ 2 A~IQn~;c " I 378BI 54~5B 5313~ ~0~4 * Puck~t~ E" ,, ' '" I , I I G~33 6~ 51 '4~ ~5 ~O 5943~ ~l 16 ~9~33 9 ~BP ~ B P - ' G4 50 ~7 34 31 Z0 ~T 8 ~5 4~ 48 ~3, , PECOS CO., TEXAS A,B,A.M, d.V, MASSEY M,E,P.~'P,R,~. SCALE - r'- I MILE NORTH COOK INLET FIELD CLUSTER SPACING APPLICATION TERTIARY SYSTEM INTERVAL The permeability of the sand in State 187~0 No o 1 over the interval &l~O ' to &lBO' was calculated by Darcy' s radial flow equation for a flow rate of 8700 Mcf/day, using' the average radius of the reservoir as the effective radius of drainage° Attachment Ne. 6 to Exhibit NO o ~. This calculation is included as Using this value for permeability plus the same flow rate and producing sand face pressure, differing values for the effective radius of drainage, Re, were substituted into Darcy's radial flow equation and solutions were Obtained for the cortes- pending values of res.erv~ir pressure, Pe, as follows: Re (f t. ) Re/Rw In Re/Rw .Pe (Ps ia) ~ Pe (Ps ia) I 1652 o 100 3~+0 5 °825 1685 33 5&5 1870 7°530 169~+ ;+0 1000 3~+30 8.135 1698 &6 26&0 9060 9 o100 1703 51 5280 18100 9 °800 1707 55 10700 36710 10. 500 1711 59 15600 53520 10 °880 171~ 62 This table demonstrates that the largest pressure drop (over 50 percent) is sustained within 100~ of the well bore° It also indicates the reason the shape of a proration unit is not of great conSequence° Note that there is' only a 4 psi difference (less than 8 percent increase) when Re is doubled from 1/2 mile to one mileo Many proration units are oblong in Texas with length being twice width° Many proration units in Louisiana are even more irregulars io e o, pie shaped,~ otc o -1- Finally, this table reveals that the incremental pressure difference from effective radii of drainage of 26~0' and 15600' (distance from the most remote productive limit to the nearest cluster location) is no more than the incremental pressure difference from effective radii of drainage of 5~5' and 2640'° A square proration unit 1090~ on the side would contain only about 27 acres° Inasmuch as gas expansion is directly proportional to pressure drop, gas at the most remote productive limit will ~ ff' flow toAthe nearest cluster well Just as readily as gas on the perimeter of a 6~0 acre unit will flow to the 27 acres located at its center° This discussion, of course, relates to a particular instant in the life of a well and reservoir° Over an extended period ef time, addi- tional pressure drop will occur at the well bore and a responsive drop will occur throughout the sand, with the final result that average 'reservoir pressure at depletion will, for all practical purposes, be independent of spacing and well geometry, se long as the depletion period is kept constant. As a result, if there is ever any advantage of regular spacing over an alternate plan, it will be in instantaneous deliverability° In the case ef the Tertiary System interval in the Cook Inlet Unit, however, it has been developed in Exhibit N~o ~ that the cluster pattern will have m~re deliver- ability than wells located on a regular pattern because of nonuniformity of thickness o This can only result in the conclusion that the cluster spacing application should be approved. STATE OF Ar,ASKA DEPARTMENT OF NATURAL RESOURCES DIVISION OF MINES AND MINERALS ALASKA 0IL AND GAS CONSERVATION COMMITTEE RE: THE APPLICATION OF PAN AMERICAN ) PETROLEUM CORPORATION for well Spacing ) in the Nomth Cook Inlet Field ) APPLICATION COMES NOW PAN AMERICAN PETROLEUM CORPORATION, Applicant in the above entitled matter, on behalf of itself and Phillips Petroleum Company, Sinclair 0il and Gas Company, and Skelly Oil Company~ Shell Oil Company, Atlantic Richfield Company, .and Standard Oil Company of California, Western Operations, Inc0; and respectfully petitions the Oil and Gas Conservation Committee of the State of Alaska for an order for well spacing: in an area designated as. the Tertiary System Initial Participating Area of the No~th Cook Inlet Unit in the No~th Cook Inlet Field. In support of its Application, the Applicant states: l0 The a~ea in which it requests the Committee to establish well spacing has been proved pmoductivm of gas and the vertical and horizontal productive limits thereof have been defined by the drilling of the following described wells at the following described locations: O~,,e~ra._tO.r L~ea_se _and _we_il. Number L99,,ation Pan American State 18740, Well 1 601' FNL, 657' FEL, Section 11 Township 11 North, Range 10 West, SoM. Pan American State 18741, Well 1 732' FSL, 20~0' FEL, Section 8 Township 11 North, Range 9 West, S.M. Pan American State 18741, Well 2 1619' FNL, 1643' FWL, Section 8 Township 11 North, Range 9 West, S,M. Pan American Pan American State 17589, Well 1 State 17589, Well 1-A 70~.2' FSL, 393°5' FWL, Section 6 Township 11 No~th, Range 9 West, S.M. 1250' FSL, 2025' FWL, Section 6 Township 11 North, Range 9 West, S.M, Pan American State 17591, Well 1 660' FSL, 660' FEL, Section 3 Township 11 No~th, Range 10 West, S.M. Shell North Cook Inlet State 1981' South, 1977' East of NW Cor~er, Section 29, Township 12 North, Range 9 West, S°M. The owners of interests in the North Cook Inlet Unit containing the Tertiary System Initial Participating Area outlin,d on Exhibit "A', ha~ ~~ V ~ D APR 2 7 DIVI$10/~ OF M~NES & ~NE~ to voluntarily intergrate such intez~sts to provide for the unitiZed management, development, and opera:ion of their leases, as authorized by Seco 38005~180 of the Alaska Statutes° The gas in and which may be produced from said unit is owned by the State of Alaska and lessees under oil and gas leases executed by (Said Lessees being defined by the Statutes and herein ~efer~ed to as the "owners"° ) Said owners, their percentage of ownership in each lease, and the lands covered by each lease included in the Tez~ciary System Initial Participating Area of the North Cook Inlet Unit, which comprises the az~a for which well spacing is sought, are as follows: Lease No. ~--Lands--in ?.a?t. ~icipa~ing_ Area Owners i i ........ , ....... ~ , i Percentage of _Ownership ADL 18741 .To.wn.s.h.ip..12_ Nor. th.,_ _Range 9 West Section 33: NW/q T.o.wps.hip..l! No~h,. Range 9 .west. Section 8: N/2 sw/q Pan American 25% Ske lly 25 % Sinclair 25% Phillips 25% ADL 18740 .Tp.wn. sh.ip..,1.2 Nor.~.h., Range 10 West Section 35: SE/q ..T.p.w~...ship. !1 North,. Range_ 10 west Section 2 section 11: E/2 Pan American 25% Ske lly 25 % Sinclair 25% Phillips 25% ADL 17589 Township _12. No~.th_, .Range 9 .West. . il Sect zon 31: Ali' Section 32: Ail T.o.wp..ship _1~1..North ,..Rap. ge 9 West Se ct ion 5: Ail Section 6: Ail Section 7: Ail Section 18: N/2 Pan American 25% Ske 1 ly 25 % Sinclair 25% Phillips 25% ADL 17590 .T.??nshiP !! _Nor. th,_ Range !0 West Section 12: All Section 13: N/2. ,T,,own_ ship .1_2_ N_or~..h, Ran. ge_ 9 wes.t.. Section 21: W/2 Section 28: W/2 Shell 33-1/3% Atlantic Richfield 33-1/3% Standard 33-1/3% ADL 18755 Tp.w~. ship 12 Nqr~, ,h, ,.. _Ran~e _9 West Section 19= SE/q Section 20: NE/t, S/2 Section 29 ~ All Section 30: All Shell 50% Atlantic Richfield 50% ~p.wn...s. hip !2_.N._qr~h.,_ Ran. ge..lO..Wes~ Section 25: SE/q Section 36: All To_wnshiP...!.l North ,_. Range.. !0 Wes: Section 1: All ° The formations which have been encountered in State 17589 Well No° 1 . between the depths of 3,500' and 6,2.00' have been proved productive of gas by RECE:IV[, APR 27 1967 DIVISION Of MINF,S & MtNF. R.A~.~ the wells described i~aragraph 1, This interval comprises a portion of the unitized interval in the North Cook Inlet Unit A~reement by which the owners have aLrreed to voluntarily integrate their interests in leases which include the subject area~ These formations designated in Paragraph 3, occurring beneath the area described in Paragraph 2, include all of each common accumulation of gas and should be considered, developed, and produced as a single source of supply° The area for which spacing is sought is located in Cook Inlet in waters at a depth of approximately 100 feet mean low low tide, and at a distance of approximately six miles from the nearest shore. ~Drilling wells on a regular spacinE plan and at regular locations would be unduly burdensome and expensive, to the extent that development of the pool on such a pattern is not feasible, · The area should be developed and operated from a single permanent platform > constructed with foundations in the bottom of Cook Inlet and rising above the surface of the waters of the Cook Inlet to a height sufficient so that develop- ment and producing operations may be conducted thereon continuously throughout the year° The wells to be drilled should be drilled from a single platform~ the number of wells to be drilled should be the minimum number required to supply the anticipated market for gas from the area~ and ~he location of the wells to be drilled should be in accordance with a pattern which will permit maximum ultimate gas productiono A "cluster" spacing pattern, in which all wells are located at the indicated optimum structural position, is necessary to permit fulfillment of these conditions, and establishment of such a pattern is the desire of the owners and the request of the Applicant° 7~ Rule 2061~2 of the Alaska Oil and Gas Conservation Regulations provides that in cases of unit agreements, governmental boundary lines within the unit may be disregarded provided the wells are drilled on 6g0 acre spacing, o~an_y o_~he_r~ w_el_l_ .sD_acing app.r_o.v_ed..by_ order ..o..f...t..h,e Commi.',~tee~ - 3 m RECEIVED APR ?'. 1967 DIVISION OF MINES & MINERAi~ ANCHOP~GE 8o For the p~event~on of waste and to protect and enforce the co~ela~ive rights of all owners in the designated area. to avoid the augmenting and accumulation of misks amising fmom the dmilling of wells on a regulam spacing pattern, to permit economical and ordemly development of the No.th Cook Inlet Gas Field. and to achieve the optimum operating condit{ons possible in the presence of the complex pmoblems involved in producing, transporting, pmocessing, and mamketing of gas from the Nomth 'Cook Inlet Area, it is necessary that a "clustem" spacing patter~ as herein requested be established for the Tertiary System Initial Pamticipating Area of the North Cook Inlet Unit° This will allow the ownems to develop the spaced area as a single common accumulation of gas fop the benefit of all the owners thereof and to pmoduce all of the gas which may be economically produced with as many wells as, but no mo~e wells than, are reasonably necessamy to supply the anticipated mamket~ all in accordance with the provisions of Sec° 31°05.100 of the Alaska Statutes and pursuant to Rule 206102 of the Oil and Gas Consemvation Re~ulationso g0 Shown on Exhibit "B", attached to this Application, is the spacin~ pattern which Applicant believes will best allow the opemator to achieve and maintain the optimum producing mate for the unit, with as many wells as, but no mope wells than, are measonably necessamy (i0eo 15 wells or one well for each ! 660 acres included in the ,Unit) and which spacing pattern will at the same time allow the pmoduction of all of the gas that can economically be pmoduced from the common accumulation om accumulations of gas included within the unit° WHEREFORE. Applicant pmays that this Pattern be set fop hearing~ that notice themeof be given as required by the Statutes and the Rules of the Committee~ that a heaping be held as pmovided by law~ and that. based upon the evidence pmesented at the hearing, the Committee entem an Omder establishing spacing fop the Tertiamy System Initial-Pamticipating Area of the Nomth Cook Inlet Unit in the North Cook Inlet Field which will per. it "clustem" dmilling in accordance with the pattern shown on Exhibit "B" and will permit the ownems to drill up to the number of wells depicted on Exhibit "B"o Respectfully submitted, PAN AMERICAN PETROLEUM CORPORATION Its Attorneys R[CFIVFD DIVISION OF MINES & MINE~ ~O~GE R I0 W TI3N TI2N T 12N T II N TIi N TION SHELL-RICHFIELD STANDARD 1.5 14 ::)AN AMERICAN-SK ELLY SINCLAIR'PHILLIPS ® 27 26 ® SHEL 24 pt. ..~ open Q PAN AMERICAN-SKELLY SINCLAIR-PHILLIPS lo ® RgW m SHELL- ~ -' RICHF]ELD~_ . mSTANDARD J S GNAL OIL 8 GAS COMPANYI /~% _ -,- mT .! ' m is l'~um m--mm----. SKELLY r-- -- -- -- Ii~N AMERICAN-SKELLY PAN AMERICAN- ~ S~NCLAm-~LLmS S~NCLAm-PH~LLmS .I '~ T IZ N · ~ SINCLAIR-PHILLIPS SHELL-RICHFIELD- STANDARD ~0 . I I ® r-~ I I I I I I I I 29 PAN AMERICAN-SKE LLY SINCLAIR-PHILLIPS 31 32 / i m m m m TI2N TIIN (~ FSHELL RICHFIELD STANDARD I0 - - I I m m AO£/8740 SHELL-RICHF ELD- PANAMERI.~AN-SKELL~ ATLANTIC ALASKAN pt. ATLANTIC (~ STANDARD I SINCLAIR-PHILLIP~ IOFFSHORE ~ 22 23 24 I 19 20 ) 2, I ASSOC. open m I i tl~ m · I lAD/_ ~/8/9 · ; I " ~ Y .... ' mm mi m· mm m m lmm m mm mi m m mr TIIN T ION RIO W R 9 W ADL 17583 ADL 17589 ADL 17590 ADL 17591 ADL 17593 ADL 18728 ADL 18740 ADL 18741 ADL 18749 ADL 18752 Federal Leased Leased State Lands Unleased State Lands Total ADL 18755 ADL 18759 ADL 18760 ADL 18766 ADL 18766A ADL 18778 ADL 21065 ADL 21819 ADL 25374 o 52,757 640 53,397 --LEGEND- ...... UNIT BOUNDARY ~ TRACT BOUNDARY Q TRACT NUMBER PROPOSED INITIAL PARTICIPATING AREA .......... TERTIARY SYSTEM EXHIBIT "A" NORTH COOK INLET UNIT COOK INLET BASIN, ALASKA 0 I 2. :5 MILES RECEIVED APR g ?. 1967 DIVISION OF MINE,S & MI~ ANCHO~GE RIOW .,~ ., RgW .,~ ? ; CHalK- ~DL /87'49, SAS-RDL /87,59 ClYAK- ADL 17,593 23 24 19 I 20 I PRODUC - ~ _ ' I / ~' ~ , '.~' SA ADL 187~ ~ S~SIADL 17590 ~ .... _~/ ~, ~ ~..___I , / _ , .... · AREA I CHAK-RDL 18740 CHRK-ADL 17589 CHRK-RDL 18741 25 24 19 20 21 SAS ADL'IX5~ T 12 N , T II N .. TING "CLUSTER" SPACING PLAN EXHIBIT B FOR THE 'TERTIARY SYSTEM -INITIAL PARTICIPATING AREA ~[~FI~/F F THE NORTH COOK INLET UNIT o I/2 I MILE APR 27.. 1~67 ~ D~VI$10N OF MINES & MINERA~ 2~ i~ "19 20 21 1 SAS ADL 'lZJ '~' CHAK-~DL. ATL. ADL IB7~S- ,q ~,hZ OFFSHORE 18~66 ' i~ t T [ A L~ ' PA RT[ C' ',~ -' "[ ~'~ G~ ,,~ AREA OF TNE NORTH CO0" ~ - , . 0 I/Z I ~llkg , ', . . FALLS CRCFK // · ~ / .. FIE:LO' , /:.' -. . , .. ' ALASKA ,. CO0~ INLET BASIN INDEX MAP S CALF': I" = '7 Mi. 3-10- 67 R I' '¥ R9W 22t SAS-AD£ 18759 14 23 13 CHAK-ADL 17593 19 ,71 CHAK- ADL 18749! P/?ODUC7'IVE LIMIT I I ! I I 34 lO rm I I I I " 22t CHAK-ADL 18746 23 SAS ADL 17583 12 13 - 404 SA ADL /8755 4163~-2 24 i I I I I ll~'I 2o! I I I I I I I I I I I '-~- I I I I I I I I I I I I I I I I CHAK-ADL 18752 MAP HOR IZO N CORRELATION LINE "A" G.I.= 2.00' CH,ZlK-ADL 17589 __] 19 20 41AS OFFSHE ATTACHMENT NO. 2 NORTH COOK INLET UNIT COOK INLET BASIN, ALASKA 0 1/2 lmile , I ATL. ADL 18766-A CHAK-,~DL 18741 TER TIA R Y S Y$ TIA t. PAR TICi A I~EA TI3N TIgN TIZN TIi N TION ADL 758:5 ADL 7589 ADL 7590 ADL 759 I ADL 759~ ADL 87£u ADL. 8740 ADL 8741 ADL :8749 ADL 875:> R IOW R 9W pt, SINCLAIR-PHILLIPS 22 23, ® 27 26 93 'iEL PAN AMERICAN-SKELLY SINCLAIR-PHILLIPS ADL 187~0 ATLANTIC ADL 18755 ADL 18759 ADL 18760 ADL 1876G ADL 18766A ADL 18778 ADL 21065 ADL 21819 ADL Z5:574 SHELL-RICHFIELD- STANDARD 22 23' ¥ '% 18 17 'RICHFIELD )AN AMERICAN-SKELLY: ;INCLAIR-PHILLIPS 6 31 STANDARD SZ 17585 j ~ 1,4D£/$7,;~,J !,JD/- 10766 ~ I IATL Ak';;stC~ ~ I ' ADZ ~/~/2 m U I ~ ~ ,m~mwm~ Zl 28 27 4DL C~590 PA N AMERICA N-SKELLY SiNCLAIR-PHiLLIPS '~/~ 3 3 34 / ! RiO W ~ R 9 W --LEGEND- Ill I I III II UNIT BO~JNDARY -- TRACT BOUNDARY Q TRACT NUMBER PROPOSED INITIAL PARTICIPATi;'-,'G AREA ~ TERTIARY SYSTF,.:~ ..' ~ . -ii ® I0 Ti2N Federal Leased I. aa/ed Stote Land$ Unleased Stole Landl Total 0 52,757 640 53,3,97 TIIN ~SHELL-RICHFIELD-STANDARD .. PAN A2~£ RiCA,N-S:<ELLY $1NCU',!R-PHiLLIPG TIIN T iON ., .: · · . . . .-, .- · EXHIBIT "A" NORTH COOK iNLET UNIT- COOK INLET BASIN, ALASKA 0 I 2 :5 ,. · EXHIBIT NO~ PHILLIPS PETROLEUM COMPANY ENGINEERING TESTIMONY CLUSTER SPACING HEARING TERTIARY SYSTEM INITIAL PARTICIPATING AREA NORTH COOK INLET UNIT COOK INLET., ALASKA Presented at Anchorage, Alaska May 15, 1967 TABLE OF CONTENTS Engineering Discussion o .... o o o ........... Appendix ...... o ..... . o o o o ......... Page Plat No. 1 o o o . o o o Cook Inlet Area Reference Plat Attachment No° 1 o ° o o Pertiuent Reservoir Data Attachment No° 2 o o ° ° Available Test Data Attachment Noo 3 o o ° o Market Data Attachment No° ~ o ° o ° Deliverability Data Attachment No° 5 o o o ° Composition of Gas Attachment No° 6 o o ° o Calculation of Permeability - State 18740 ~l Attachment No° 7 o ° o o Estimated Lease Development Cost Attachment No° 8 o o ° ° Electrie Log - State 17585 #1 ENGINEERING DISCUSSION - CLUSTER SPACING TERTIARY SYST~ INITIAL PARTICIPATING AREA NORTH COOK INLET UNIT COOK?~LET, ALASKA' The North Cook Inlet Field (See Plat No o 1) was discovered in August, 1962, by Pan American Petroleum Corporation, as operator for itself, Sinclair Oil and Gas Company, Ske. lly Oil Company, and Phillips Petroleum Company. The .discovery well, State 17589 Well No o 1, blew out during drilling operations in August, 1962o State 17589 Well NOo lA was spudded as a relief well and was completed as a shut-in producer in ~'August, 1964o Test data on this well are included on Attachment No. 2o .. As of this date,, seven wells have been drilled in or adjacent to the area for which spacing is being requested° These are: Operator Lease and Well Number Location Pan American State 18740, Well 1 601' FNL, 657' FEL, Section 11: Township 11 Northi Range 10 West, SoN. Pan American Pan American Pan~ American State 187~1, Well 1 State 187~1, Well 2 State 17589, Well 1 732~ FSL, 2040' FEL, Section 8, Township 11 North, Range 9 West, .SoNo 1619~ FEL, 16~3~ FWL, Section 8, ToWnshiP 11 North, Range 9 ' West, SoMo 704o2~ FSL, 393~5~ FWL, Section 6, Township ll North, Range 9 West, SiM° Pan American State 17589, Well lA 1250 ~ FSL, 2025 u FWL, Section 6, TOWnship 11 North, Range 9 West, SoMo Pan American Shell State 175'91, We~ 1 North Cook Inlet State 1 6604 FSL, 660~ FEL, Section 3, Township 11 North, Range 10 West, $oNo 1981~ South, 1977~ East of NW Corner, Section 29, Township 12 North, Range 9West, SoNo Subsurface data from the above wells, plus area geophysical data, have established the productive limit shown on Phillips~ Exhibit Nco .o This has been separately treated in geologic testimony and will not be addition~l~y discussed here, except to state that it comprises an area that would be fully developed on a density of 640 acres per well with 13 wells° It will be noted, however, that only 10 wells could be drilled at "regular" locations (in the center of the sections) within the productive area° The Tertiary' System sand members for which spacing is being sought were encountered between the depths of 3500~ and 6200~ in State 17589 Well No° 1o Copies of the electric log of this well are included as an attachment° Numerous sand members exist in the interval between 3500~ and 6200~ and wells sho~d.d be completed so that the various zones are depleted simultaneously (treated as a single source of supply)° Each sand member can be penetrated by each well. drilled in the cluster pattern and thereby maximum recovery of gas will be realized° Simultaneous depletion of the various sand members will result in the maximum amount of recoverable gas above the economic limit of production° Electric log aualysi~ indicates that the productive sand~ members have porosity varying from 22 percent to 36 percent, with the average about 28 percent o Water ~aturation by log calculation averages about ~0 percent° Core data are not available from which to obtain permeability data but this measure of the quality of the sand is otherwise determinable from test data° Attachment Nco 6 shows a calculation of the permeab~ity of the sand in State 187~0 Well NCo 1 between ~1~O~ m~d 418@~ by Darcy~s radial flow equation° The calculated permeability is 180 millidarcy~o This permeability is indicative of a go,d quality gas reservoir~ It has been Phillips~ experience in good quality gas reservoirs that one well, properly located, would ultimately drain an entire reservoir° Additional wells are necessary only from the standpoint of protecting correlative rights and developing sufficient deliverability to deplete the reserves in a reasonable period of time° Tertiary System sand reserves underlying the area for which spacing is sought should be sufficient to support production at the rate necessary to supply the available market for a period of twenty to thirty years, which is a normal depletion period for gas fields° Attachment Nco 3 details market data° 'No correlative rights problem exists as this is a unit operation° The cluster pattern was devised both to maw~imize recovery from the field in the event a water drive develops and to assure maximum deliverability for the longest possible period of time° It is concluded that the cluster pattern will provide about 1-1/2 times as much initial deliverability as could be obtained from wells 1,coated on a regular pattern in the center of their respective sections o The technical reasoning that resulted in this conclusion is included in the Appendix° If drive is by volumetric depletion, this same ratio should apply throughout the producing life of the field° But tfa water drive develops, the cluster pattern will continue to have a high deliverability for a mami~m period, whereas the regular pattern would decline at, a fast rate due to wells watering out° Wi'th a regular spacing pattern and a water drive, all but three wells would water out before gas contract commitments could be met and it would be necessary to reappear before you and ask permission to drill additional wells on the crest of the structure, probably at the same locations currently being requested° Because of the location of the North Cook ~let Field (See Plat No. l) operations are expected to be very costly, and it is therefore essential to the economic development of the field that the cluster spacing pattern be approved° In addition to permitting development of the ma~tmum deliverability possible, it should result in a minimum investment savings of approximately $2,785,000, over drilling l0 wells on a regular pattern° Wells drilled in the cluster pattern will efficiently and economically drain the entire reservoir. It will be noted that the application requests permission to drill up to fifteen wells in the pattern prescribed° At this ~time it is unknown how much deliverability will be developed with each fall interval well. If more deliverability is developed by each full interval well than is presently premised, fewer than fifteen wells will be required. Rule 2061.2 of the Alaska 0il and Gas Conservation Regulations provides that in cases of unit agreements, governmental boundary lines within the unit may be disregarded in establishiug spacing, Provided the wells are drilled on 6~0 acres, or any other well spac.~n~ approved by order of the. C~itteeo _ The spacing pattern as proposed will permit development of the Tertiary System in the Initial Participating Area of the North Cook Inlet Field from one platform, thereby making development feasible from an economic standpoint° In addition, it will assure that maximum ultimate gas production will be recovered with the minimum number of wells required to supply the anticipated market for gas in the area, It is requested that, pursuant to · Rule 2061o2 of the Oil and Gas Conservation Regulations and in accordance with the provisions of Section 31°05°100 of the Alaska Statutes, spac~ be established as proposed° ,i APP~DIX The cluster pattern was devised both to maximize recovery from the field in the event a water drive develops and to assure maximum deliverability for the longest possible period of 'time° It will maximize recovery in the event a water drive develops as a consequence of sweep efficiency being higher with the cluster pattern than it would be with a regular pattern° That it will assure maximum deliverability for the longest possible period of time is reasoned as follows: If the reservoir were of uniform thickness, a comparison between the volume of gas that would flow into the cluster area and that which would flow into each well evenly spaced on 640 acres can be calculated by Darcy~s radial flow equation. In the case .of the cluster pattern, the effective radius of drainage 'would be the average reservoir radius of 10,700~ and the radius of the "well" would be the radius of the cluster pattern - 400Or, Just as if an infinite number of wells were drilled within the pattern. In the case of the well on 640 acres, the effective radius of drainage would be 2640t and the radius of the well would be approximately 3", premising 7" OD casing° Substituting, dividing the first by the second, and canceling out like terms, results in the following: Q 4000 Q 3" In 2640 0.2915 in !0700 4000 = 9.25 Or, an infinite number of wells in the cluster area would deliver 9.25 as much as each well on 640 acres. The maximum number of wells that could be drilled on a density of 640 acres per well is thirteen~ Thus, the cluster area would deliver about seven-tenths as much gas as these thirteen wells would deliver (9°25 + 13) evenly spaced on 6~0 acres throughout the reservoir, if the reservoir were of uniform thickness° On the other hand, only ten regular locations in the center of full sections exist within the productive area of the reservoir. The cluster area should deliver about nine-tenths as much gas as these wells would deliver (9.25 + 10), again, if the reservoir were of uniform thickness° The fact of the matter is, however, that the reservoir is not of uniform thickness and of the 10 regular locations, only three would have sand thicknesses equal to what is expected at each of the cluster locations° Three of the regular locations would have sand thicknesses between 50 and 75 percent of maxinn~n° The remaining fOUr would have sand thicknesses less than 50 percent of the maximum. Relating deliverability to sand thickness, these ten locations of variable sand thickness would have deliverability equal to about six wells of maximum sand thickness° The conclusion is that the cluster pattern will provide about 1-1/2 times as much initial deliverability (9.25 + 6) as regular locations · would provide o If drive is by volumetric depletion, this same ratio should apply throughout the producing life of the field° On the other hand, if a water drive develops, the deliverability of the cluster will remain at a high level for a maximum period because the wells will all be located at a favorable structural position; whereas, if the wells were drilled on a regular pattern all but three wells would water out before gas contract commitments could be met° It would then be necessary to obtain permission to drill additional wells on the crest of the structure, probably~ at the same locations currently being proposed° ~ 6 -- / R-lO-W/ / / W. FORELAND I2-N /~"~j FIELD I ,~RTHUR // I / RI VE R-F~?/ / / / SHOAL FIELD I iI I / / I I / ~ t ~ I / I ' " ' ,"~e~ ~ STANDARD 01~ REFINERY ~ ~~ SHOAL TERMIN~~, PLANTSITE T-6-N MOQUANKIE FIELD ~' I '~l / ~ L_..' NICOLAI FIELD TYO] T-II-N / '~ I GRANITE POINT ~,. t.~.,! ~y/// tI FIELD / '~1//.///1! tRADING BAY // / // / / / /II MIDDLE' GROUND / I / ! / / / / / COOK INLET FIELD T-IO-I~ R-8-W T-9-N RCH HILL FIELD I R-D-W / ~. SWANSON RIVER R-IO-W / / FIELD , // R--II-W t/ ; WE ST FORK FIELD / / STERLING FI ELD ~" FALLS CREEK FIELD ANCH. R-9-W N A~' UR A.L. GAS i T-5- N COOK T- II-N --ALASKA . INLET BASIN INDEX MAP SCALE; I" : 7 tMI. 3-10~67 L.N.B. TERTIARY SYSTEM NORTH COOK INLET FIELD Pertinent Reservoir Data Physical Properties of the Reservoir Rock: Average Porosity (By E. L. Cal.) Average Water Saturation (By E. L. Cal.) Average Permeability ~ Reservoir Pressure and Temperature - Variable with Depth: In State 18740 - Interval~ 4140' - 4180~: Pressure Temperature In State 17589 - Interval 5153' - 5163': Pressure Temperature (Extrapolated) Gas Gravity at Standard Conditions (See Composition Elsewhere) Type Trap Productive Interval - State 17589 No. 1 Productive Area 28 percent 40 percent 180 md - Est. 1711 psia 119° F 2478 psia 129° F .559 Anticline 3500 ~-6 200 ~ 8300 Acres + Attachment No. 1 TERTIARY SYSTEM NORTH COOK INLET FIELD Available Test Data CI State 18740 No. 1 Wire Line Tests Depth .FSIP Recovery 5907 - None 5052 23.00 50 cf gas - no water 4666 2125 Mud 4666 - Mud 4636 - 100 cc sand; .8 cf gas - no~ wat er 4156 1675 (ISIP) 33 cf gas - no water 4010 - No recovery Drill Stem TeSts _Interval 4140,,4180,- Tool open 8-1/2 hOurs. SI 5 hours. SI BHP = 1711 psia. Flow Rates as follows: 3/8" choke, 1400 psig FTP, 1682 psig FBHP, 75 min: FARO 3664 Mcf/day ~ 1/2" choke, 1375 psig FTP, 1665 psig FBHP, 120 min: FARO 6045 Mcf/daY 5/8'i choke, 1150 psigFTP, 1637 psig FBHP, 195 min: AOF ='~4 M cf/day CI State 18741 No. 2 0ri l st,em, ,Tests, Interval 5570'-5580' - Rec. 550' W.C. and 100' mud. Interva!_~284'-4.294' - Rec. '550' W.C. and 3180' S.G.C.W. · Interv~._~_4~225Jr~235' - Flowed 1 hour to clean up and tested as follows: 1/&'" choke, 1450 Psig FTP, 75 miu: FARO 1025 Ncf/day 3/8" choke, 1400 psig FTP, 105 min: FARO 4230 Mcf/day 1/2, choke, 1175 psig FTP, 90 min: FARO 6780 Mcf/day 2-1/~ hour SI BHP = 1704~ psig _~ AOF = 20.5 M2cf/day Attachment No. 2 Page i CI State 17589 No. lA Drill Stem Tests Interval 6206 '-6226 ' -Rec. 1000 ' W. C. and 2240 ~ mud. Interval 5153'-516~' -Flowed as follows: 1/4" choke, 1800 psig FTP, 120 rain: FARO 2752 Mcf/day 3/8" choke, 1325 psig FTP, 270 man: FARO 5500 Mcf/day 1/8" Choke, 2150 psig FTP, 180 man: FARO 407 Mcf/day SI BHP = 2~63 in 2 hours. iO > (Ha cno e) Interval ~0.75'-~105' - Flowed as follows: 1/4" choke, 1550~psig FTP, 60 man: FARO 2485 Mcf/day 3/8" choke, 950 pstg FTP, 60 man: FARO 5020 Mcf/day 1/2" choke, 1575 psig.FTP, 420 min: FARO 4575 Mcf/day SI BHP = 1850 psig in 1 hour · AOF > 12-1/4 M2cf/day (Had BH choke) S.R. NOrth Cook Inlet State No. 1 Drill Stem Tests · Interval 4023i'~0~3' - Flowed as follows: 1/&" choke, 1296'psig FBHP: FARO 912 Mcf/day 3/8" choke, 695 Psig· FBHP:' FARO 1940 Mcf/day 1/2" (Initial) Choke, 495 psig FBHP: FARO 2180 Mcf/day 1/2" (Final) choke, 742 psig FBHP: FARO 3140 Mcf/day Flow periods unknown, SI 274 min., SI BHP = 1691 psig AOF = 4 M2cf/day Attachment No o 2 Page 2 TERTIARY SYSTEM NORTH COOK INLET FIELD Market Data LNG to Japan Tanker Fuel Boil-off Plant Fuel Total at Plant Inlet 138,400 7,500 2OO 20,600 166,700 North Cook Inlet Share 166,700 X 0.7 116,690 Mcf/day 42.59 Bc f/year *Premised on 1000 Btu gas Attachment No. 3 NORTH COOK INLET UNIT DELIVERABILITY DATA Cluster Pattern Year Average Pressure Rate at Mid-year Mcf/d SI psia FTP psia 1969 116,900 1522 1446 1970 " 1481 1404 1971 " 1~39 1359 1972 " 1397 1314 1973 " 1355 1269 1974 " 1312 122~ 1975 " 1268 1176 1976 " 1224 1129 1977 " 1180 1081 1978 " 1136 1033 1979 " 1093 985 1980 " 1049 936 1981 " 1006 887 1982 " 962 837 1983 " 917 786 Compressor HP* 286 734 1290 1850 2510 3266 *Cent rifugal C ompres s ion Premises: 15 Wells equal in deliverability to State 18740 Well No. !'in interval 4140 '-4180. Wellhead delivery pressure = 1000 psig. Wells to be equipped with minimum of 4" tubing. Depletion drive. Attachment No. 4 COMPOSITION OF GAS CI State 18740 #1 N2 CO2 C1 C2 Sr O. 73 percent .08 percent 99.13 percent 0.06 percent lO0.O0 percent .559 Attachment No o 5 CALCULATION OF PERMEABILITY State 18740 #1 Q = ,903 k h (Pe2 - Pw2) Z~ Tf in Rear~ Where Q is in Ncf/day = 8700 k is in darcies h is in feet = 40 ~ is in cp = .022 Tf is in °R = 579 ~ = .853 Pe = 1711 psia Pw - 1652 psia Re = 10700 ~w = .2915' Re ~n ~w - ~o.~o - :?o~-~ ~o x (z-~~ _ ~~) k = .178 darcies ,':, ~., .' Attac.hment No. 6 ESTIMATED LEASE DEVELOPM~T COST NORTH COOK INLET UNIT Drilling and Production Platform Rig Up Satellite PlatfoTM Dehydrator- Initial Dehydrator - FUture Producing Equipment - Initial Producing Equipment - Future Connecting Lines 1968 'Wells 1969 Wells 1970 Wells TOTAL With Cluster With Regular Spacing Pattern Spacing Pattern $ lO,35o,ooo $ lO,35o,ooo 1,080,000 1,080,000 - 4,600,000 2?0,000 2?0,000 220,000 220,000 200,000 200,000 450,000 450,000 - 810,000 1,050,000 1,050,000 5,250,000 4,200,000 ~1,575'000 - $ 20,445,000 $ 23,230,000 Note: Initial Deliverability of Cluster 'Pattern Estimated at 150 percent of Regular Pattern. Attachment No. 7 \ m PERMANENT PLATFORM ... 12 7 U --I · '. ~'HAK-AOL 17589 CHAK-~IDL 1874~ CN~K-4DL SAS ADL CNA K-A , ATL. ADL 187~6-A ALAS, OFFSHOR~ 18y66 EXHIBIT "CLUSTER" ,.,, ,,.C[~'-~G,,, PLA FOR THE 'TERTi* ,~RY SYSTE~ 'INITIAL PARTICi~:,~TIN. G, ~, AREA OF THE NOR ~, CC.:,~o~,. ~ LET t. ~ R IOW Rgw RICHFIELI~_ ~ STANDA~D~ SIGNAL OiL ~ GAS ~MPANY~ " ~N AME~AN-S~ELLY J PAN AMERICAN- SKELLY ~ PAN AM ERICAN-SKELLY J~" SH~L-RICHFIE~D' ~ StNC~IR-PHI~IP~ i ~ STANDARD I 12 7 8 9 ~ II J I . ~ STANOARD / . ~ ' I ! SINCLAIR-PHILLIPS / ~ 'J ' j J 3ANAMERI~SKE~ %6A~RICAN-SKE~Y ~ .... '. i SlNCLAIR-~I~IPS SINCLAIR-PHILLIPS J TIgN ~ ~ ~ m _ i ~ ., ',.. TII N j ~ -' · . ., .~. I a '' J SINCLAIR' PH ILLI PS j I IO H ~z 8 9 IO SHELL-~iCHFIEL~'S N~AR~ . .:.,..... :.. , · I ~ ~ ~'~ ~'" '" :'"*'"' "'': ' I 16 15 I~ ~I~ 18~/4 17 16 ~ .._ .. .. ~ . . , ~ ~OL 10740 pi ~ ~ ' j ATLANT~CJ SHELL-RICHFIELD' ~NAMERI~AN-SK~ ATLANTIC ALASKAN · ~ ....... ~ANDARD SlNCLAIRTPHILLII ~FSHORE ~ j J -, .J " . . , · ~ ~7 ~6 j . .. ~ ' .' ' TII N u TIIN ii TION .. _:., . , .......'. . . R I0 W R 9 W . :'.:,'.:.,:..'.. . . . . . . .- . ADL 17583 ADL 18755 " ' ADL 17589 ADL 18759 -LEGEND- ." ADL 17590 ADL 18760 .~mmm. UNIT ~NDARY ADL 17591 ADL 18766 Ag~ '7593 ADL 18766A T~ ~UNDARY AL~ ,7~8 AD~ 18778 ~ ~ACTNUMBER ' ' ' , , A~740 ADL ZI065 ' ADL 18741 ADL ~1819 PROPOSED INITIAL PARTICIPATING AREA ~ ADL 18749 AD~ ~5374 TERTI~Y 8YST~ ADL 18753 ~ "' "'. '~' ' ~osed Slate ~nds 52.757 Unleaded Stole ~nd~ 640 , ¥ · · · . ., I EXHIBIT "A" .o NORTH COOK INLET UNIT- COOK INLET BASIN, ALASKA o 1 2 ~ M3 ~Es .. . ·