Amoco Canada’s capital spending took a big jump in 1994, as new horizontal wells were drilled to counteract the natural drop-off in production from older wells in the Elk Point oilfield. Amoco’s Heavy Oil General Manager Bruce Lounds, from the Calgary office, and Elk Point Property Management Team members Randy Best, Calgary, and Ron Johnson, Elk Point, outlined the present activities and hopes for the future in the Elk Point and Lindbergh fields at Town Council’s November 15 meeting.
Amoco has been operating in the area since 1984 and has recently streamlined their assets by concentrating on their core businesses: heavy oil production in this and the Bonnyville areas, natural gas, and buying and selling crude oil. They have sold some land and acquired other land, and now have a 66 percent working interest in the Lindbergh field.
At the current time, the Elk Point operating centre controls 165 sections of land, almost all of it south of the river, and has 325 out of a total 873 wells in operation. Amoco currently has 55 employees and full time contractors in the area. They spend $3 million a year on contract services, two thirds of this on well servicing and optimization, and the remainder on facility maintenance and improvement.
Amoco’s capital spending in the Elk Point and Lindbergh fields took a big jump from $4 million in 1992 to $7 million this year, and is expected to climb to $9 million in 1994. Three quarters of this was spent on drilling. Amoco drilled their first horizontal well in the summer of 1992, and a second, less successful well, at the end of that year. They have drilled four more to date in 1993 and expect to drill two more by year end. The horizontal wells have opened up new possibilities as they access more of the oil reservoir.
The company’s gross daily oil production in the Elk Point and Lindbergh fields has dropped from more than 2500 cubic metres to approximately 1900 cubic metres since early 1992, Randy Best told Council. In the 25 sections which made up Amoco’s original Elk Point holdings, this decline has been as much as 25 percent. Best said the decline is essentially in one of the three oil-bearing zones, and that experiments with a different kind of thermal steaming which is hoped will seal off pathways and prevent oil dispersing, are being tried. “You have to be a risk taker,” Best said. “There’s an enormous reserve, and if we can unlock the technology, there will be a long life for heavy oil.”
The 140 sections on the Lindbergh side of the field also offer an enormous potential for growth.
Amoco’s future in the area is expected to last into the new century, but the exact length depends on technology and the effectiveness of the secondary recovery methods now being developed. Primary recovery generally extracts only 7 to 12 percent of the resource, while secondary methods extract another 50 to 60 percent. “There are enormous gains to be made if we can find the key,’ Bruce Lounds concluded.
