A Texas-based oil company announced it has made a large-scale oil discovery offshore Alaska.
According to Caelus Energy Alaska, the finding could amount to 6 billion barrels of light oil in the Arctic Oceans of Smith Bay.
“It has the size and scale to play a meaningful role in sustaining the Alaskan oil business over the next three or four decades,” Chief Operating Officer Jim Musselman, said.
US Firm Makes World-Class Oil Find Offshore Alaska
According to Caelus, if estimates prove to be true, this “world class” oil discovery could be one of the largest ever in Alaska.
The development could deliver 200,000 barrels per day (bpd) of light oil to the trans-Alaska pipeline, the company explained.
A rig operating in Smith Bay, offshore Alaska
As well as this, such a discovery could increase volume and reduce the average viscosity of oil, which would help extend its viability, the company added.
The discovery is based on 126 square miles of three-dimensional seismic data and two wells drilled this year from ice pads.
Smith Bay Could Hold 10 Bn Barrels
The company did not conduct flow tests to verify the well’s capabilities “due to seasonal time constraints”, but “extensive sidewall coring and subsequent lab analyses confirm the presence of reservoir-quality sandstones containing oil,” Caelus explained in a statement.
Another appraisal well and seismic work is planned to improve estimates of the oil in place, with hopes that the Smith Bay complex could hold a total of 10 billion barrels of oil.
According to Sullivan, it will be years before the discovery starts production, with the next appraisal well planned for 2018.
If everything goes according to plan, the CEO explained, oil could flow to the trans-Alaska pipeline in 2022.
Meanwhile, Caelus is assessing options for a drilling platform.
Caelus Energy Alaska Smith Bay has a 75% ownership in the state leases at Smith bay, while NordAq Energy Inc. holds a 17.5% interest and L71 Resources a 7.5% interest.