Exxon Mobil begins process to support drilling for gas in Alaska

Recently, the Associated Press reported that Exxon Mobil has completed the initial barging of equipment and supplies to support its plan to drill for natural gas in Point Thomson on the North Slope of Alaska. Exxon Mobil said Thursday that the work supports the drilling program outlined in the plan submitted to the state earlier this year. The barges and tugs, operated by Crowley Maritime Corp., moved ice road and construction equipment to the site. Point Thomson is the North Slope''s second-largest natural gas field after Prudhoe Bay. The field is estimated to hold about 9 trillion cubic feet of gas reserves, more than a quarter of the known gas in all North Slope fields. Exxon Mobil has conducted field operations at Point Thomson for several weeks following the issuance of permits. It is awaiting more permits from state regulatory agencies needed to allow drilling activities to continue. Road construction is planned for late 2008. The project will cost approximately $1.3 billion, which includes a five-well delineation drilling program and a multiyear development to construct production facilities, pipelines, and support infrastructure. The upgraded Nabors rig will drill the first well this winter. Under the initial phase, approximately 200 million cubic feet per day of gas is expected to be produced. Approximately 10,000 barrels per day of liquid condensate that is separated from the gas, is planned to be delivered for sale through new and existing oil pipelines. The remaining gas will be injected back into the Thomson Sand reservoir to maintain pressure for continued hydrocarbon recovery and for subsequent gas sales. Exxon Mobil and other owners -- BP Exploration (Alaska) Inc., Chevron U.S.A. Inc., ConocoPhillips Alaska Inc., as well as 23 additional companies -- are proceeding with the project while they seek to resolve a dispute with the state over the area and leases.