ExxonMobil Corp. is readying yet another plan to produce natural gas from its Point Thomson field on the North Slope of Alaska. The $1.3 billion, six-year project, if approved by state officials, could ramp up in 2009 and perhaps help push forward the long-awaited gas pipeline.
The Point Thomson field is estimated to contain about a quarter of the North Slope's 35 Tcf of gas reserves. Last month the U.S. Department of Energy said the construction of a 4.5 Bcf/d pipeline by 2015 and the ability to sell gas from the Prudhoe Bay and Point Thomson fields would nearly double the revenue to the state, federal government and industry (see Daily GPI, Jan. 31).
Exxon's latest development plan for Point Thomson, which was submitted to the Alaska Department of Natural Resources (DNR), calls for producing 200 MMcf/d by late 2014. In addition, about 10,000 bbl/d of liquid condensate would be separated from the gas and shipped through new and existing oil pipelines, and the remainder would be pumped back into the reservoir to maintain pressure. The proposal indicates that Exxon already has secured a drilling rig and wants to drill five exploratory wells. The project also would allow for expansion if the state's gas pipeline ultimately is built.
In the past 30-plus years, Exxon has filed 22 plans to develop the 106,200-acre lease at Point Thomson, but all of them have been rejected by the state. And it's unclear whether Alaska will accept the latest plan. On March 3 Exxon and DNR are scheduled to meet in a public hearing about the latest plan. An Alaska Superior Court judge in late December ruled that DNR was in the right when it rejected Exxon's last proposal (see Daily GPI, Jan. 2).
Besides Exxon, Point Thomson leaseholders include BP plc, Chevron Corp. and ConocoPhillips. The companies have argued in the past that the Point Thomson leases could not be economically developed, and the state threatened to nullify the leases. In December 2006 Exxon asked the court to overturn Alaska's decision to revoke its Point Thomson leases (see Daily GPI, Jan. 2, 2007).
Because of the litigation, neither Alaska officials nor Exxon could not comment on the producer's latest development plan.
"We have completed significant engineering and geoscience work over the past 18 months, focused on reservoir evaluation and development planning," Exxon said. "The assessments indicate that a phased development is a prudent approach to maximize the benefits to the State of Alaska and the Point Thomson owners, especially since a gas pipeline is more than a decade away."
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