An oil company says it has found a "world-class" oil reserve off the coast of Alaska that could be one of the largest in the state's history.
Targeting a Brookian submarine fan complex that covered more than 300 square miles, the Caelus-Tulimaniq #1 exploration well and Caelus-Tulimaniq #2 step-out each hit hydrocarbon columns of more than 1,000 ft, logging 183 ft and 223 ft of net pay, respectively, Dallas-based Caelus Energy said.
A development of the Smith Bay discovery could deliver some 200,000 barrels of oil per day, according to Caelus.
Chief Operating Officer Jim Musselman called the discovery exciting for the state, which receives a majority of its revenue from the oil industry.
In the 1970s, when oil was first discovered in Alaska, the find was welcomed by a nation shocked by high prices and the anxiety of Middle Eastern producers threatening to stop selling their oil to the U.S. "It has the size and scale to play a meaningful role in sustaining the Alaskan oil business over the next three or four decades".
"Fiscal stability going forward is critical for a project of this magnitude", Musselman iterated in the corporate release.
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According to Sullivan, it will be years before the discovery starts production, with the next appraisal well planned for 2018.
AIM quoted 88 Energy's priority is its new shale discovery, which is also believed to have "multi-billion barrel potential", most recently estimated between 1.4-3.6bn barrels, though it does remain interested in exploring for conventional reservoirs. "We're proof that the credit programs work", Musselman said in a statement. The appraisal program will enable Caelus to confirm reservoir continuity, optimize future drilling locations, and ultimately increase reserves.
About Caelus Energy Alaska Smith BayCaelus Energy Alaska Smith Bay is a 75 percent working interest owner in the State of Alaska oil leases at Smith Bay.
With a state pipeline system on empty, Alaska's governor optimistic about a new oil discovery in the state's North Slope region.
He credits the state's tax credit programs for providing an incentive to explore. Caelus is now planning an appraisal program that will include drilling and the acquisition of new 3D seismic data.
The projected recovery for Smith Bay is about 2.4 billion barrels, which makes it the third largest oil field in Alaska after Prudhoe Bay and Kuparuk River fields, operated by BP and ConocoPhillips, respectively.