West Sak Field Development: Analysis of a Marginal Project
Authors: Foerster Cathy P. , Lynch Keith W. , Stramp Ryan L. , Werner Michael R. , Thompson Rodger R. 
Published: December 2007

The West Sak reservoir on the north slope of Alaska has original oil in place (OOIP) of between 10 and 20 billion barrels. Although this resource has been widely recognized for over 15 years, it has remained essentially undeveloped, with total production of less than 0.1 percent of OOIP.

A wide variety of complex issues - technical, financial and political - have made West Sak development appear too risky for even the major north slope operators. This paper presents a project management approach used to build a development plan that addresses the areas of uncertainty, minimizes the risk and will likely lead to a phased, "pay-as-you-go" West Sak development.

The approach used to build the West Sak development plan applied some techniques commonly accepted in the business community to break some old paradigms that were built and cemented into place by years of traditional North Slope engineering thinking. Carefully scrutinizing the range of uncertainty of the project variables (both controllable and uncontrollable) using a tornado plot and quantifying the risk-versus-return using a cumulative probability plot provided clarity that enabled the resource owners to shift to a new paradigm. This new paradigm has identified value realization possibilities previously unrecognized. The expected outcome is a profitable West Sak development.

Reservoir Description

As shown in Fig. 1, the West Sak reservoir has a large areal extent - 30 miles north to south and 20 miles east to west, from the western area of Prudhoe Bay Field across the Kuparuk Field. The West Sak dips from west to east with the top of the West Sak found at approximately 4500 ft SS in the East and approximately 2000 ft SS in the West. Inspection of Fig. 2 shows that the West Sak is a highly stratified and poorly consolidated sandstone with gross thickness of 400 ft and net pay of only 90 ft. Two Upper West Sak and one Lower West Sak intervals have been designated. Complex faulting breaks the reservoir up further.

With the wide variation in depth also come wide variations in temperature, pressure, oil gravity and oil viscosity. Temperature ranges from 60 to 100 degrees F, pressure ranges from 1000 to 1800 psi. oil gravity ranges from 10 to 22 degrees API, and viscosity ranges from under 30 to over 3000 centipoise.

Only a small portion of the West Sak is seen as producible with current technologies. This "sweet spot" of the reservoir, shown in Fig. 3, overlies the eastern part of the Kuparuk Field and is found at an average depth of 3500 feet. To the east the West Sak is wet and to the west the oil is too viscous to flow. In the "sweet spot" of the West Sak the temperature is 75 F, the reservoir pressure is 1450 psi, the oil gravity ranges from 17 to 21 API, and the viscosity ranges from 26 to 27 cp.

History

A flurry of exploratory activity between 1969 and 1978 revealed the shallow heavy oil potential in the Kuparuk area, and Kuparuk Field delineation and development between 1979 and 1981 verified the large areal extent of the resource. In 1982 ARCO Alaska, Inc. (AAI) identified the West Sak as a reservoir with near-term production potential and in 1983 initiated a West Sak pilot waterflood that operated for 2-1/2 years. The pilot was viewed as a technical success because it confirmed that the sweet spot of the West Sak could be developed by conventional waterflooding methods, demonstrated sustained well rates of over 200 BOPD, and evaluated a variety of completion strategies.

However, the pilot was viewed as a business failure for a variety of reasons. First, it was felt that production rates needed to be much higher than 200 BOPD. However, the completion innovations explored had not proved that these higher rates were achievable. It was felt that the success of West Sak would rely on undeveloped or unproven technologies. Second, it was recognized that the expected West Sak volumes could not support the high development and operating costs experienced at Prudhoe Bay and Kuparuk at the time and the pilot had not adequately investigated cost reduction strategies for the West Sak. P. 109^