In Alaska’s October 2010 lease sale, Great Bear Petroleum surprised just about everyone by winning 105 tracts covering over 2,000 km. directly south of the Prudhoe Bay Complex (see GEO ExPro, Vol. 8, No. 2). Since that time, they have set out to evaluate their acreage. Great Bear’s initial 2-well drilling programme was completed in late November 2012, where they recovered over 183m of whole core from the Alcor #1 and Merak #1 wells and sampled oil from the conventional Kuparuk sand. Great Bear is currently evaluating the core samples, well logs, oil samples and other tests to assess and calibrate the play fairway. Great Bear has also just finished acquiring an additional 3D seismic programme covering approximately 596 km. of proprietary 3D seismic adjoining its existing 154 km. of proprietary 3D. These operations were fully funded by Halliburton Energy Services, Inc. satisfying the earning provisions for a 25% working interest in 510 km. and an option to provide services in just that area.
Great Bear is targeting primarily the unconventional oil and natural gas liquids (NGL) fairway in its acreage, which is adjacent to the Trans-Alaska Pipeline System (TAPS) south of the Prudhoe and Kuparuk oil fields. According to Great Bear’s president, Ed Duncan, “Our initial plans were to drill a couple of horizontal sidetrack wells from the original vertical wells to test oil production from the unconventional play. However, operations and lab analysis took much longer than expected so we had to suspend drilling operations due to expiration of our rig contract.”
The US Geological Survey (USGS) 2012 assessment looked at three North Slope source rocks. These were (1) the Triassic Shublik Formation, (2) the lower part of the Jurassic-Lower Cretaceous Kingak Shale, and (3) the Cretaceous pebble shale unit and Hue Shale, which together are referred to as the Brookian shale. These three shales generated most of the oil and gas that migrated into Prudhoe Bay and other large conventional fields found on the North Slope. Great Bear is the first to target them directly.
The Shublik Formation has sourced 23° to 39° API gravity and high sulphur (greater than 1.5%) oil from a mixture of Type I and IIS kerogen. This transgressive facies reaches a thickness that exceeds 61m in western National Petroleum Reserve A (NPRA) and thins depositionally east to Prudhoe Bay where it is truncated by the Lower Cretaceous unconformity. Both the total organic content (TOC) and the original hydrogen index (HI) are highest from north-eastern NPRA to where the formation is truncated at Prudhoe Bay. The Shublik is considered a good reservoir candidate, containing brittle rock types (limestone, sandstone, siltstone and chert) in which natural fractures are common. Dr. David Houseknecht of the USGS concluded that the best oil potential for the Shublik occurs in the shale-oil assessment unit (AU) as determined by thermal maturity (the area where Great Bear is exploring). The Shublik has good gas potential for much of the North Slope.
The Kingak and the Brookian shale contrast with the Shublik in that these formations have sourced higher gravity (35-42° API) and much lower sulphur (less than 0.3%) oils from predominately Type II and III kerogen. In eastern NPRA and further east, the lower Kingak contains a condensed shale section that has high TOC and HI values. USGS researchers inferred that this area has the best oil and gas potential; however, the Kingak consists of mostly clay shale that deforms plastically and may not be a good reservoir. With similar kerogen as the Kingak, the Brookian shale does have brittle lithologies such as very-fine grained sandstone, siltstone, concretionary carbonate, and silicified tuff that could render it a much better reservoir. These brittle facies, along with high TOC and HI, occur east of NPRA across the central North Slope and have been encountered in both Great Bear wells. The area of highest oil and gas potential is located on State lands between NPRA and the Arctic National Wildlife Refuge (ANWR,) where the thickness exceeds 150m.
All three of these source rocks occur over much of Alaska’s North Slope and range in depths from less than 900m along the Barrow Arch to over 6,000m along the Brooks Range front. Thermal maturity varies from immature near the coast, through the oil window and into dry gas to the south near the Brooks Range. The USGS has assigned the Shublik with a 95% probability that technically recoverable oil and gas will be possible, 90% for the Brookian shale, and 40% for the Kingak. With no production data to date, the USGS estimates 0 to 928 MMbo and 0 to 72 Tcfg for the Shublik, 0 to 955 MMbo for the Brookian, and 0 to 117 MMbo for the Kingak (gas was not assessed for the Kingak). They concluded that “the Shublik is estimated to contain the greatest oil and gas resource potential per unit area, with values that rank among the top few source-rock systems in the United States.”
Great Bear’s Programme
The 2012 drilling programme confirmed that all three source rocks which the USGS evaluated are present and in the ‘oil window’. The shallowest unconventional zone, the lower Hue/HRZ shale (Brookian), was encountered with good oil shows over an interval in excess of 180m. Cores over this interval are very organically rich with TOC values up to 8%. They also recovered 30m of lower Kingak core (possibly one of the most complete ever taken). Finally, their primary target, the Shublik Formation, was cored through the entire formation. Both the Kingak and Shublik were at the thermal maturity that would support light oil and condensate generation, confirming Great Bear’s regional thermal maturity fairway mapping.
In addition to these unconventional plays, the wells penetrated three conventional plays. The Brookian turbidite fan play is productive at the ConocoPhillips-operated Meltwater Field, located west of Great Bear’s acreage. The next conventional play these wells encountered was the Kuparuk sandstone that is regionally productive to the north, centred at the Kuparuk Field. Finally, they encountered the Ivishak, which is the primary reservoir at the Prudhoe Bay Field.
In early 2013, Great Bear acquired 596 km. of proprietary 3D seismic, which is now being processed and expected to be completed by late summer. This data will be combined with their existing 3D to give them over 750 km. of 3D coverage across the core of their lease holdings. They will use this data to codify a dual conventional/unconventional exploration programme that covers 175,000 acres (708 km.) positioned along and west of the TAPS and Dalton Highway.
Right Place – Right Time
In spite of the Arctic conditions, Great Bear is operating in an area that has seen decades of exploration and development activity with no urbanisation or agricultural activity across their lease position. This is often not the case in the lower 48 states, where shale development can be hampered and operationally challenging in populated or agriculturally intensive areas. There is also a lack of potable water aquifers in the central North Slope area, mitigating the possibility of municipal ground water contamination. In addition, a thick layer of permafrost is present across the area, which provides a ‘barrier’ between the frac depths and the surface. There are, however, ample surface and brackish sub-surface water supplies for drilling and stimulation programmes. The Dalton Highway, as well as the TAPS (currently operating at 40% of design capacity), bisects Great Bear’s acreage, providing the necessary low-cost access to markets.