USGS Reassesses Alaska Energy; Discoveries Hike NPR-A Estimate

Less than 80 miles from Prudhoe Bay, home to the giant oil fields that feed the Trans-Alaska Pipeline, lies the site of the U.S. Geological Survey’s (USGS) latest oil and gas assessment—the National Petroleum Reserve-Alaska, or NPR-A, and adjacent areas. Managed by the Bureau of Land Management, NPR-A covers 22.8 million acres, more than the entire state of South Carolina.

A new USGS assessment estimates 8.7 Bbbl of oil and 25 Tcf of natural gas resources. This is a more than six-fold increase from the previous agency estimates in the region, which includes parts of the 2005 Central North Slope assessment and the 2010 NPR-A assessment. The USGS decision to reassess NPR-A came after several industry announcements of potential large discoveries in the area, which were much greater than previously thought. The Pikka and Horseshoe discoveries near the Colville River Delta just outside NPR-A were announced in 2015 and 2017. Industry announcements suggest that the two discoveries 21 miles apart are likely in the same oil pool, which may hold more than 1 Bbbl of recoverable oil.

“Advances in technology and our understanding of petroleum geology are constantly moving forward,” said Walter Guidroz, program coordinator of the USGS Energy Resources Program. “That’s why the USGS reevaluates and updates our assessments, to give decision-makers the best available science to manage our natural resources.”

Industry announced the discovery of the Willow oil pool in the NPR-A’s Nanushuk Formation in 2017 with estimated resources of more than 300 MMbbl of oil. Multiple wells are expected to be drilled during the 2017-2018 winter drilling season at both Pikka-Horseshoe and Willow to further delineate the discoveries. Industry also announced an oil discovery in the deeper Torok Formation at Smith Bay, less than one mile to shore from NPR-A, in 2016 to hold more than 1 Bbbl of oil. Another oil discovery in the Torok Formation was announced in 2015 at the Cassin prospect in NPR-A, not far from the Willow discovery. No plans for additional industry drilling have been announced at either Smith Bay or Cassin.

Although USGS has a range of potential for the new estimates of oil and gas resources, there is significant uncertainty regarding values. Until further wells are drilled and oil production is initiated, it is difficult to be certain about the resource potential. Nevertheless, a sufficient amount of data is available to confirm that the potential size of oil pools in the Nanushuk and Torok formations is six times larger than previously thought.

Prior to 2015, about 150 exploration wells had penetrated the Nanushuk and Torok formations, and oil discoveries were limited to a few small oil pools of less than 10 MMbbl in stratigraphic traps and one larger pool of more than 70 MMbbl in a structural trap. The new USGS assessment of the formations estimates that
oil and gas resources are not uniformly distributed across the region, and divided each formation into three assessment units. These assessment units were defined based on geological character documented using data from seismic-reflection surveys, exploration wells, and outcrops. The assessment did not include rocks older than the Torok formation in NPR-A because they have not been penetrated by exploration drilling since previously assessed in 2010, therefore there is no new information available about their oil and gas potential. The 2010 assessment of those older rocks estimated they hold 86 MMbbl of oil and nearly 15 Tcf of gas.