Donkel oil and gas LLC is one of many companies that are going after these undeveloped oil discoveries made by the Majors back when prices where lower and technology was not as advanced as it is today. On May 1 Petroleum News Alaska reported the proposed Donkel Oil and Gas (NYSEARCA:DOG) Unit has 21, 354 acres to develop containing the Arco Stinson Number 1 discovery well and if approved by the State of Alaska Donkel tells World Energy “more oil and gas could be flowing from this very large oil and gas discovery in the very near future. Also Exxon is planning to bring its giant oil and gas Point Thompson discovery on line, which is right next to the DOG Unit and the Stinson discovery well.
As the price of oil remains near $100 per barrel, Governor Parnell, Senator Murkowski and Senator Begich have all been demanding to open up drilling in Alaska. The Governor is sending an open invitation to the smaller oil companies that are looking to invest in Alaska, and a strong message to the Federal Government. Dan Donkel of Donkel Oil and Gas LLC says, “Alaska has the big oil fields America needs for the future to save our nation from economic ruin.”
These smaller companies include operators like Apache, Brooks Range Petroleum Corp, Armstrong Oil and Gas, Buccaneer Energy, Great Bear, Escopeta and Savant which are all developing resources in Alaska. I am sure we will see all of them at the Pacific Section American Association of Petroleum Geologists event in Anchorage next week.
With gasoline topping $4.00 per gallon in 13 states. President Obama recently suggested that we all need to buy smaller cars or “hybrid vans” to deal with this situation. However, historically the answer to high prices is to announce more drilling here in the United States.
One solution would be to follow Governor Parnell’s plan to open Alaska’s Arctic National Wildlife Refuge (ANWR). This could potentially add 1 million barrels of new oil per day over the next ten years to help fill the Trans Alaska Pipeline, while creating lower taxes and adding incentives that will encourage oil companies to come back to Alaska with more risk capital and drill more wells.
Today Alaska is sitting on unprecedented reserves of oil and natural gas waiting to be tapped. Recently, Governor Parnell has been pointing to the need to drill in the Outer Continental Shelf and around Anwar (not in ANWAR). Additionally, much more activity has been occurring around the Cook Inlet.
Senator Lisa Murkowski has been calling on Congress and the EPA to allow development in Alaska to move forward, and with good reason. Recently several articles have been published which cite a USGS study that there are 10.3 billion barrels of oil available off the North Slope, for instance, the land with the old Stinson #1, drilled by Arco in 1990 flowed lots of oil and gas.
The Stinson well allowed a third-party engineering firm to assign 150 million barrels of probable reserves (420 million as a P10) to a single Base Eocene sand, while a deeper Base Tertiary sand flowed 51 API (very high quality) condensate to 37 API brown oil (Good Quality) from an impaired drill stem test, that engineers estimated would have flowed at rates up to 800 BOPD, had the hole integrity been maintained. Additionally, the well flowed 17 million cubic feet (NYSEMKT:MCF) of gas per day. According to Don Brizzolara, former Arco geologist, “it would seem very reasonable that from 1 to 4 TCF (trillion cubic feet) of gas are present with an average of around 2 TCF. The combined oil reserves of the Stinson Field may range from 200 to 800 million barrels of oil.”
Donkel says that by developing this “DOG Unit” we will be able to help prove up some of estimated 10.1 billion barrels of oil in place that the USGS identified. It may even be possible to develop some of the oil in ANWAR without ever stepping foot in the reserve by drilling horizontally from the DOG Unit. Of course an aggressive development plan will need to be put in place to tap into this oil, but a recent visit to the Offshore Technology Conference in Houston shows that the industry has new procedures and safety recommendations in place, and are ready to deploy them offshore to insure that what happened in the Gulf of Mexico does not happen in Alaska.
Alaska has always had the oil, and today they have the leadership to attract new oil and gas investment and the oil companies of the World are ready to “Discover” this resource. Donkel says, “We see a renewed Oil Boom coming to Alaska and it is happing now.”