OTC 22563

Arctic development of the Canadian Beaufort Sea, Geohazards and Export Route Options Ian Nash, Peritus International Ltd.

Copyright 2015, Offshore Technology Conference This paper was prepared for presentation at the Offshore Technology Conference held in Copenhagan, Denmark 23-25 March 2015. This paper was selected for presentation by an OTC program committee following review of information contained in an abstract submitted by the author(s). Contents of the paper have not been reviewed by the Offshore Technology Conference and are subject to correction by the author(s). The material does not necessarily reflect any position of the Offshore Technology Conference, its officers, or members. Electronic reproduction, distribution, or storage of any part of this paper without the written consent of the Offshore Technology Conference is prohibited. Permission to reproduce in print is restricted to an abstract of not more than 300 words; illustrations may not be copied. The abstract must contain conspicuous acknowledgment of OTC copyright.

ABSTRACT Studies have suggested that the Arctic contains over 30% of the world’s untapped natural gas reserves, and approximately 13%

of its undiscovered oil reserves. The Beaufort shelf in the Canadian Arctic has been of interest for Oil and Gas development for

many decades and reached a peak in the Mid 1980's when over 50 drilling islands were built to explore potential reserves by

various international oil companies, with 92 wells recorded in the Canadian Beaufort Sea area.

The Amauligak field was discovered in the Canadian Beaufort in 1984, and is still the largest oil and gas discovery in the

Mackenzie Delta or Beaufort Sea areas. Amauligak lies approximately 75 kilometres northwest of Tuktoyaktuk in 30 metres

water depth in the Beaufort Sea. The field is thought to contain 235 million barrels of oil and 1.3 trillion cubic feet of natural

gas.

Whilst vast resources such as Amauligak are known to exist in the Canadian Beaufort, the key to development of these remote

areas is finding a viable export route for oil and natural gas. This was clearly the case for the development of the Prudhoe Bay

Area of the Alaskan Arctic with the development of the Trans Alaskan Pipeline in the 1970's following the discovery of oil on

Alaska’s North Slope in 1968. This facilitated the development of the North Slope and shallow water offshore fields such as

North Star which peaked in 1988 at about 738 million barrels per annum, about 25% of total U.S. production.

Unlike the offshore shallow water Prudhoe Bay Developments, the development of the Beaufort shelf and slope will bring with

it significant remoteness and geohazard issues as well as the familiar ice challenges. This paper highlights some of the geohazard

issues facing Canadian Beaufort developments and considers what options exist for the safe and economical export of the product

to market.

INTRODUCTION It was estimated by the the United States Geological Survey in 2008/9 (Refs.2,3) that 30% of the world’s untapped natural gas

reserves (1,670 Trillion Cubic Feet), and approximately 13% of the worlds undiscovered technically recoverable oil (90 Billion

barells oil) and 20% of the undiscovered natural gas liquids (44 billion barrels) are contained within the Arctic Circle. The

Specific estimates for the Canadian Beaufort Sea and Mackenzie Delta area are as high as 10.6 billion barrels, mostly offshore

in the Beaufort Sea (Ref. 4) and 56.9tcf natural gas approximately half of which is offshore in the Beaufort Sea (Ref. 5). These

estimated reserves are consistent with estimates made by the US Bureau of Offshore Energy Management (BOEM); in its 2012

final leasing program it estimated the Beaufort Sea holds undiscovered technically recoverable reserves of 8.2bn bl of crude and

27.6 Tcf of natural gas.

The offshore oil and gas reserves in the Beaufort Sea are thought to exist in 6 groups; Deep Water; Kugmallit Delta; Rifted

Margin; Basinal; West Beaufort; Taglu. The vast majority of the offshore wells drilled in the Mid 1980’s were in the Kugmallit

group in shallow water (<40m) and slightly deeper water Basinal group (Ref. 4), which extends out to the edge of the continental

slope (40m-80m). The development of the Beaufort Sea began in the early 1970’s with 91 of the 92 wells drilled to date being

spudded before 1990 (Ref. 6). Due to harsh environment most of the wells drilled have been from seabed founded drilling

structures in water depths less than 40m. The maximum depth of any well drilled is 68m.

The largest oil and gas discovery in the Mackenzie Delta or Beaufort Sea areas to date is the Amauligak field which was

discovered in the Canadian Beaufort in 1984. Amauligak lies approximately 75 kilometres northwest of Tuktoyaktuk in 30

metres water depth in the Beaufort Sea. The field is thought to contain 235 million barrels of oil and 1.3 trillion cubic feet of

natural gas. The only oil production to date from the Beaufort Sea occurred in 1986, by Gulf Oil, who shipped a tanker load of

317,000 barrels of oil from the Amauligak field to Japan (Ref. 5). The first natural gas production from the Mackenzie Delta

was in July 1999 from the Ikhil gas field (discovered by Gulf), which provides local production to the town of Inuvik.

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The search for Oil and Gas in the Beaufort Sea is highly complex and costly due to the extreme environment, a multi-

jurisdictional regulatory system and multiple technical challenges. The extreme climate, ice conditions, seabed geohazards, long

periods of darkness, and remoteness each contribute to the complexity of planning and costs of exploring for hydrocarbons in

the Beaufort Sea. The very short summer drilling season and the presence of multi year ice flows are key contributing factors to

the high cost of exploration and development. From a development perspective the presence of ice and its potential interaction

with the seabed and the numerous seabed geohazards that have been seen to be present, will be key to successful development

and are also likely to drive high costs. In recent years there has been a view that oil and gas activity in the Beaufort Sea will

grow off the development of natural gas fields feeding the Mackenzie Gas Pipeline (MGP). However, MGP is currently

considered uneconomic due in the most part to the development of Shale Gas in the Lower 48, it is more likely that oil rather

than natural gas will be the driver for near and middle term development activities in the Beaufort Sea

Oil development in the Beaufort Sea, does not necessarily require the offshore expansion of an onshore pipeline network.

Offshore oil production would most likely be by subsea facilities in water depths greater than 50m, with subsea pipelines tied

back to shore or Gravity Based Structures (GBS) in shallow waters. The option to use Floating Production Storage and

Offloading (FPSO) facilities is unlikely to be viable for the ice conditions prevelant in the Beaufort Sea. It is likely then that

development of the Beaufort Sea will only take place if world hydrocarbon prices are high. A key factor in keeping costs down

will be finding a technically viable and economic export route for produced Oil and Gas.

EXPLORATION OF THE CANADIAN BEAUFORT Early Exploration In the 1970’s and 1980’s ninety one offshore wells were drilled in the Beaufort Sea by varous drilling platforms in water depths

up to 68m, with only one well drilled since 1990 in 2005. The distribution of drilling year and water depth for these early wells

is presented in Figure 1. In the Mid 80’s the rapid decline in demand for oil and resulting drop in the world oil price, dramatically

affected the demand to undertake exploration in the Beaufort Sea. The hightened awareness of the implications of hydrocarbon

exploration and production due to spill impacts resulting from the Exxon Valdez disaster in 1989, also contributed to the rapid

decline.

Figure 1 Distribution of Wells Drilled in Beaufort Sea by Year and Water Depth

Future Potential The potential for Oil and Gas recoverable reserves in the Beaufort Sea is high and increasing oil prices in the mid 2000’s led to

a renewed interest in Beaufort Sea reserves. Work performed by Chen et al 2007 (Ref.4), indicates that 40% of the mean

recoverable oil reserves, more than 6.7 billion barrels, are thought to be from the Deepwater (>100m) off the continental slope.

Figure 2 shows the estimated mean recoverable and discovered oil for the 6 main Beaufort Sea areas.

Figure 2 Estimated Recoverable and Discovered Oil Resources for Canadian Beaufort Sea Plays

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

Bill

ion

Bar

rels

Beaufort Sea Plays(data source Chen et al Ref.4)

Estimated Mean Recoverable Oil

Discovered Oil (P50)

OTC 22563 3

Current Beaufort Sea Licences Currently there are 15 offshore Licences issued for the Beaufort Sea. These licences cover a total of 2.78 million hectares and

are held by 7 different Operating Companies.The location of these licence blocks are shown in Figure 3. The main areas covered

by these licences are in the Deepwater, Basinal and West Beaufort in water depths greater than 50m, and account for 85% of the

total hectares under licence (29.3%, 29.2% and 26.2% respectively) Ref 1. All current licences expire by 2022.

Figure 3 Current Beaufort Sea Licences

It is most likely that significant hydrocarbon development of the Beaufort Sea will involve fields at the edge of the continental

shelf in water depths greater than 50m and on the continental slope.

FIELD DEVELOPMENT OPTIONS Continental Shelf - Shallow (less than 40m WD) For developments in shallow water depth less than 40m it is likely that Artificial Islands (AI) or Shallow Gravity Base Stuctures

(GBS) will be used with directional drilling and satellite subsea wells located in Glory Holes (GH) tied back to the GBS. All

flowlines and export pipelines require deep burial to avoid ice interaction.

Continental Shelf - Deep (40m – 80m WD) For developments on the outer continental shelf in water depths between 40m and 80m it is likely a GBS located in water depths

between 50m to 60m will be used with directional

drilling and satellite wells and facilities located in GH’s

and on the seabed. All flowlines in water depths less than

50m require deep burial to avoid ice interaction. A

limitation on the water depth for location of the GBS is

the ability to transit a GBS through the Bering Strait.

Continental Slope (Greater than 80m WD) For developments on the continental slope in water

depths greater than 80m it will be necessary to adopt a

subsea development consisting of multiple drill centres

tied back to a GBS located on the shelf in water depths

from 50-60m. The licence blocks in the deepest water

EL477 (Imperial), EL476 (Imperial) and EL481

(Chevron) are more than 50km from their deepest part to

100m water depth and more than 80km to the a potential

GBS location at 50m water depth. Whilst gas tie backs

of this distance are well within existing capabilities

worldwide (Canyon Express, West Delta deep) it is well

beyond current developments for oil tie-backs the

longest of which is the Shell Penguins development at 66km.

SOILS AND GEOHAZARDS OF THE BEAUFORT SEA Soil Conditions

The Canadian Beaufort Sea can be devided into four distinct areas and nine physiographic regions as defined by the Geological

Survey of Canada (Ref. 16): Yukon Shelf (Natsek Plain); Mackenzie Trough; Central Shelf (Kringalik Plateau, Ikit Trough,

Akpak Plateau, Kagmalit Channel); Eastern Shelf (Tingmiark Plain, Nigik Channels, Kaglulik Plain) as seen in Figure 6. It can

be seen that most of the current licence blocks lie within the Mackenzie Trough and Central Shelf areas.

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

% B

eau

fort

Sea

Lic

ence

s

Beaufort Sea Plays(data source Ref. 1)

Figure 4 Potential Field Development Layout

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The surficial clays, defined as Unit A in the geologic model (Ref.16), consist of bioturbated marine clays and silty clays with

sand. Surface sediment thickness is highly variable depending on the physiographic region. On the plains and plateaux, surface

sediment thickness is generally less than a few centimetres. In larger linear depressions and troughs, these surface sediments

form depression infill and can be up to 20 m thick. These surficial marine clays are mostly illite and are 40 to 60% clay, 30 to

50% silt and up to 15% sand. The sediments are characterized by low undrained shear strength, high compressibility and a

moderately to high apparent overconsolidation ratio.

The underlying strata (Unit C) are predominantly silts and silty sands with intervals of soft marine clays and silty clays which

have large variations in undrained shear

strength. Underlying sands are very dense and

well sorted. The major change in soil type

between surficial Units A and B and

underlying soils (Unit C) marks the upper limit

of the well bonded permafrost table, with the

overlying fine grained sediments being largely

unfrozen. The underlying dense sand acts in

the most part to limit the depth of scours. The

surface sediments in the physiographic regions

is summarized in Ref. 16 as follows:

Mackenzie Trough mean surface sediment

thickness 6.0m, characterised as a soft to firm, medium to high plastic, homogeneous, grey, overconsolidated silty clay (28 kPa)

Kringalik Plateau mean surface sediment thickness 3.8m, characterised as a very soft to firm, medium to high plastic,

homogeneous, grey, overconsolidated silty clay (28 kPa).

Ikit Trough mean surface sediment thickness 7.5m,

characterised as soft to very soft, overconsolidated,

grey, silty clays with a trace of organics (7 kPa).

Akpak Plateau mean sediment thickness 1.6m

characterised as very soft to firm over consolidated to

normally consolidated sediments are classified as lean

to fat (CL-CH) clays with silt or sand (7 kPa).

Kugmallit Channel mean surface sediment thickness

6.7m, characterised as lean to fat (CL-CH) clays with

silt or sand (12 kPa).

Tingmiark Plain mean surface sediment thickness

2.1m, characterised as very soft to soft

overconsolidated, lean to fat (CL-CH) inorganic clays

with silt or sand.

Niglik Channels mean surface sediment thickness

0.3m.

Kaglulik Plain mean surface sediment thickness 0.8m.

Ice

ISO 19906 (Ref.9) gives guidance on Ice design conditions for the Beaufort Sea, which it summarizes as “arctic polar pack,

composed of old or multi-year ice with a level ice thickness up to 4.5 m to 5 m and ridges that can be 25 m thick. On average,

the boundary of the arctic pack lies from near Cape Prince Alfred off Banks Island southwestward to some 200 km north of

Herschel Island and then westward some 200 km off the Alaska north coast. The landfast ice is extensive and forms out to a

water depth of approximately 20 m.”

The Eastern, Middle and Western Beaufort Sea Continental Shelf areas and North Slope Arctic coastline areas are characterised

by first year and potentially multi-year ice features (Ice Gouges) left by ice keel contact. Unlike the eastern Canadian seaboard,

which is characterised by icebergs that gouge the seabed, the gouges in the Beaufort Sea are formed by rafted ice, pressure ridges

and multi-year ice from the polar pack ice that forms deep keels. Ice gouging of the seabed in the Beaufort is caused by winds,

currents and waves driving the ice sheet containing these ice keels.

Figure 7 shows multibeam sonar image of an ice scour on the Beaufort shelf seafloor. The keels of sea-ice pressure ridges cut

through seafloor sediments to form ‘V’ shaped incisions. Most ice scours are less than 0.5m deep but extremely deep events can

exceed 2m in depth. Topography of the Beaufort seafloor is generated by multibeam sonar from various research campaigns. It

Mackenzie

Trough

Kringalik

Plateau

Akpak

Plateau

Ikit

Trough

Tingmiark

Plain Kagluli

k Plain

Niglik

Channel

s

Kagmalli

t

Channel

Natsek

Plain

Figure 5 Surface and underlying Strata on the Outer Beufort Shelf (Ref. 16)

Figure 6 Physiographic Regions of the Canadian Beaufort Sea Ref.16

OTC 22563 5

is evident that the seafloor is covered with the tracks of ice scours that range in age from one year to many decades. Older scours

are obliterated by newer events and/or are infilled by sediment over time.

Figure 7 Multi beam Images of Beaufort Shelf Seabed (Ref.a-14, b-14, c-15)

Pingo Like Features (PLF’s) and Mud Volcanoes

Over 1000 Pingo Like Features (PLF’s) and mud volcanoes have been identified across the Beaufort and Yukon shelves, many

of which have not been mapped in detail and their origin is unclear. PLF’s are observed individulally and in groups at various

locations on the flanks of the Mackenzie Trough, on the Central and Eastern Beaufort shelf and upper parts of the slope (see

Figure 8). In 2009 numerous “New” PLF’s were observed at the shelf break near the head of a slump area in offshore blocks

EL491 and EL476. It is currently believed that submarine PLFs fall into five categories (Ref.19) as listed below:

submarine-formed pingos

mud volcanoes

diapirs

relict topography

slump features (along ridge and margin

boundaries)

Gas Vents and Pock Marks

Gas vents and pock marks are observed in the central and

Eastern Beauforf Shelf area. Vents range in size from less

than 1m to more than 20m in diameter and are up to 9m

deep. Pock marks are also observed on the edge of the

MacKenzie trough and on the outer edge of the Beaufort

shelf. One of the most significant examples of gas vents

on the Beaufort shelf is the vent complex in Kugmallit

Bay in 8m water depth at the entrance to Tuktoyuktuk

harbor (Figure 8 Inset).

Gas Hydrates

Gas hydrates are thought to exist both within and beneath the permafrost which lies under the Eastern Beaufort Shelf. They also

exist in water depths greater than 250m on the Beaufort slope. The presence of gas hydrates and potential for liberation of gas

due to subsurface activities needs to be accounted for. Evidence exists of gas hydrate occurrence at the Nerlerk, Koakoak,

Ukalerk and Kopanoar exploration wells where Weaver and Stewart (1982) Ref. 20, established that geothermal conditions are

conducive for gas hydrate stability from approximately 225m to 1500m depth. Most appraisals suggest that up to 80% of the 93

exploration wells drilled to date on the shelf show evidence for sub permafrost gas hydrate occurrences.

Subsea Permafrost

The Beaufort Shelf west of the MacKenzie trough is underlain by subsea permafrost, which is thought to extend offshore to the

edge of the Beaufort Shelf. The depth to the base of the subsea permafrost decreases as the edge of the shelf is approached.

Drilling logs from Nerlerk, Koakoak, Ukalerk and Kopanoar exploration wells (Ref. 20) reported depths of between 925m to

300m below mean sea level.

2009 PLF’s

1979-2007 PLF’s

Gas Vents

Figure 8 PLF’s, Mud Volcanos and Gas vents Observed on Beaufort Shelf

(Ref. 16) inset - Gas Vents Kugmallit Bay

6 OTC 22563

Slope Instability

The stability of the Beaufort Sea continental slope

(water depth greater than 100m) is not well

defined and there is little data on geohazards such

as submarine slides in the upper slope. However

evidence of mass transport events exists at the

shelf break in Blocks EL491 and EL476. This

feature was first located and studied in 1979, but

was not extensively mapped until 2009. The

sediment dislodged in the event covers an area

approximately 25km wide (E-W) and 20km long

(N-S). The vertical headwall is in close proximity

to the 100m isobath at the shelf break, it also

coincides with the hypothesized northern edge of

subsea ice bearing permafrost which may have

played a role in determining the position of the

southern edge of the slide (Ref. 16). It is

interesting to note that there are far fewer PLF’s

and Gas vents in the immediate vicinity of the

headwall as compared with several hundred PLF’s

and Gas Vents that were mapped during the 2009

survey near the shelf break to the east of the slip

feature. The slide is thought to be relatively recent due to its sharp appearance and apparent lack of infill although its age is

unknown.

Regional Seismicity

The whole Mackenzie valley is associated with

seismic events onshore. This seismicity extends

offshore into the MacKenzie fold – thrust belt.

Figure 10 shows recorded seismic events location

and magnitude in the Beaufort Shelf area east and

west of the Mackenzie Trough as extracted from

the National Earthquake Database (NEDB) since

1985. (Ref. 21). Up to magnitude 6 have been

recorded in the area with most events being

between magnitudes 3 to 5. Design of the pipelines

and flowlines must take account of this seismicity,

especially with respect to slope stability as

evidence of slope failures on the shelf break within

blocks EL491 and EL476 (Figure 9). It is clear that

slope stability may be an issue even at relatively

shallow slopes angles present on the Beaufort

slope.

Pipeline Burial

Generally, pipelines and flowlines cannot be shown to have the capacity to survive direct contact with ice features in the Beaufort

Sea area. Pipelines and flowlines installed in the Beaufort Sea area should be trenched to a depth below the bottom of the design

ice gouge incision depth. The amount of additional trench depth required below the design ice gouge incision depth is based on

the amount of flowline movement caused by the sub-gouge soil displacement beneath the keel of the ice features. Depending on

the flowline depth below the ice keel, this sub-gouge soil displacement can be sufficient to bring the flowlines beyond their

design bending strain limits. Adianto and Hong statistical data analysis on new scour characteristics in the Canadian Beaufort

(Ref. 12) as derived from the 1992 Nessim and Hong study (Ref. 13) gives guidance on maximum scour depth in various areas

of the Beaufort Sea as presented in Table 1.

It is clear then that offshore pipelines in arctic Beaufort Sea area can be subject to damage from floating ice keels if they are not

buried sufficiently deeply. For the purposes of initial studies for Beaufort developments, it is considered that the pipelines or

flowlines should be able to accommodate a 100year ice scour event without any damage or effect on operations. Additionally it

is assumed that the pipelines or flowlines should survive (potentially with damage) a 3000year event. For the Central Shelf area

where most of the current licence blocks are located, the maximum scour depth for a 100yr event is 3.12m and 300yrs survival

event is 6.6m. To meet the 100yr “No Damge” limit state a sub soil displacement clearance to allow for subsoil movement under

Figure 9 Slope instability Shelf Break in Blocks EL491 and EL476 (Ref.#)

5.0-5.9

4.0-4.9

3.0-3.9

2.0-2.9

Slide Headwall

Figure 10 Seismicity Record (Magnitude)

OTC 22563 7

a scour event has to be added. Typically this subsoil displacenet allowance will be of the order of 3m to Top of Pipe (TOP). The

resulting nominal trench depth requirement over most of the

central and eastern Beaufort Shelf (in water depths grater than

15m) will be 6m – 7m TOP. All will where ice impact is a

potential threat to the. It is assumed that all developments

which include pipelines or flowlines will require trenching in

water depths less than 50m. For specific developments,

detailed studies will be required to determine the required

trench depth especially in the 25m-30m water depth range for

the area of Central Beaufort shelf where the deepest scour

depths are observed.

During later phases of any Beaufort Sea development, site

specific surveys will need to be performed over several years

to statistically define the site specific ice gouge design

conditions. A study of the geomorphology and paleo-

geologic history of the area and the formation of the sea

basins may help better understand when the ice keel marks in

the seabed have occurred. This may confirm whether deep

scours are relic (ancient) gouges from a previous, shallower

sea level period or if they are recent and suitable for the

statistical sampling group. It is unclear whether the original

Nessim and Hong data set includes observations of relic

gouges or only recent gouge evidence.

EXISTING AND PLANNED INFRASTRUCTURE FROM THE BEAUFORT SEA

General Exporting hydrocarbons from

the Beaufort Sea via pipelines

has been planned since the early

1970’s, following the discovery

of hydrocarbons at Prudhoe Bay

in 1968. Numerous Oil and Gas

overland pipelines have been

proposed to evacuate

hydrocarbons south, to avoid

the constraints of the icebound

waters of the Beaufort Sea.

Some, like the Trans Alaskan

Pipeline Project that transports

Oil from the North Slope

onshore fields to export

facilities at Valdez have come to

fruition. Others like the Alaskan

Natural Gas pipeline have gone

through various incarnations but

are still to be realised.

Alaskan Natural Gas Pipeline Project In 1976, the United States Congress passed the Alaska Natural Gas Transportation Act (ANGTA) to expedite development of a

natural gas pipeline from Alaska's North Slope (Ref. 8). The original pipeline proposed by the Federal Power Commission, (now

the FERC), recommended an overland pipeline route through Canada to move Alaska gas to the Lower 48 states, via a route

along the Alaska Highway. As Gas prices increased in the early 1980’s, suppliers of gas in the Lower 48 natural gas began to

increase their production and the immediate need for the Alaska Natural Gas Transportation System (ANGTS) declined. The

subsequent reduction of gas prices due to oversupply occurred which persisted for many years resulting in prices that were too

low to cover the costs of the full Alaska gas line project. Southern sections of the system were however constructed allowing

producers of the Western Canadian Sedimentary Basin in Alberta, Canada to deliver gas into the lower 48 via a western leg into

California in 1981 and and Eastern Leg to the US Midwest in 1982. Various reincarnations of the Alaskan Natural Gas Pipeline

Project have occurred since 2000, namely the Denali-Alaska Pipeline in 2008 which reinstated the original Alaskan Natural Gas

pipeline route but which was discontinued in 2011.

Table 1 Maximum Scour Depth (Ref.13)

Water

Depth

(m)

Maximum Scour Depth (m) 3000yr

(100yr in paranthisis)

1992

Study 2013 Study Other

All

Region

Yukon

Shelf

Mac-

Kenzie

Central

Shelf

Eastern

Shelf

US

North

Slope

5-10 (1.09) (0.92) 2.2

10-15 2.68 3.65

(1.81)

3.9

(1.74)

2.77

(1.27) 2.6

15-20 4.04 3.42

(1.72)

5.16

(2.60)

5.19

(2.16) 3.8

20-25 4.71 5.35

(2.90)

3.28

(1.65) 4.8

25-30 4.49 6.66

(3.12)

3.38

(1.53) 4.9

30-35 5.32 3.5

(1.59)

4.29

(2.07)

2.45

(0.94) 4.9

Figure 11 Historical Pipeline Projects from the Beaufort Sea

Alaska LNG

Pipeline

(planned)

TAPS

(existing)

8 OTC 22563

Trans Alaskan Pipeline The Trans-Alaska Pipeline System (TAPS) includes the trans-Alaska crude-oil pipeline, 11 pump stations, several hundred miles

of feeder pipelines, and the Valdez Marine Terminal. The pipeline runs 800 miles (1,287 km) of 48 inches (122 cm) diameter

from Prudhoe Bay, to Valdez, Alaska. The pipeline was built between 1974 and 1977 after the 1973 oil crisis caused a sharp rise

in oil prices in the United States. This rise made exploration of the Prudhoe Bay oil field economically feasible. In 2010, the

pipeline has shipped almost 16 billion barrels (2.5×109 m3) of oil.

Mackenzie Pipeline Project The Mackenzie Valley Pipeline is a proposed project to transport natural gas from the Beaufort Sea through Canada's Northwest

Territories to tie into gas pipelines in northern Alberta. The project was first proposed in the early 1970s, but was scrapped

following an inquiry conducted by Justice Thomas Berger. The project was resurrected in 2004. The current Mackenzie Gas

Project proposes to build a 1,200km pipeline system along the Mackenzie Valley. It would link northern natural gas producing

wells to southern markets. The main Mackenzie Valley Pipeline would supply 1.2 billion cubic feet per day of natural gas and

connect to an existing natural gas pipeline system in northwestern Alberta. The Mackenzie Valley Pipeline was shelved in 2013

as being uneconomical primarily due to Shale gas development in USA.

Alaska LNG ExxonMobil, ConnocoPhillips, Transcanada and the State of Alaska have proposed a 42”, 1,300km pipeline from Alaska North

Slope to an LNG liquefaction facility and shipping terminal at Nikiski on the Cook Inlet. This pipeline will initiate in Point

Thompson with a feeder pipeline from the Point Thompson Gas Fields to Prudhoe Bay where it will be joined by gas from the

North Slope developments and be conditioned to remove CO2 and compressed before entering the Main 42” pipeline to Nikiski.

The pipeline will follow the route of the Transalaskan Pipeline from Prudhoe Bay to Livekgodo 86km North East of Fairbanks

then head due south via Cantwell and Trapper Creek to Beluga where it will cross the Cook Inlet to the LNG facilities at Nikiski

(Ref.7) The project is currently undergoing pre-FEED engineering which is scheduled for completion in early 2016. On 21st

November 2014 the US Department of Energy granted authority to Alaska LNG for exports to countries covered by free trade

agreements with the United States.

OFFSHORE EXPORT PIPELINES FROM THE BEAUFORT SEA General

This paper reviews the routing options and issues for Export Pipelines from a notional GBS location on the central Beaufort

Shelf. The ultimate destination for oil and gas exports will be different. The most likely destination for Oil exports will be the

tanker export terminal at Valdez Alaska. The desitination for Gas exports would, until recently, have been the US Lower 48 via

the proposed Mackenzie valley Pipeline, however since this pipeline has now been shelved due to poor economics the most

likely desitination for Beaufort Sea Gas will be the proposed new LNG facility at Nikiski on the Cook Inlet.

Routing

Two basic options exist for routing both oil and gas

pipelines from the Beaufort shelf to the southern

coast of Alaska. The first is a westerly route along

the Arctic coast to the Point Thompson/Prudhoe

Bay area, to allow onward tie-in to TAPS oil system

or the Alaska LNG line for Gas. The second is a

south westerly route cross country from the

Mackenzie delta to intercept the TAPS and Alaska

LNG pipeline in the vicinity of Fairbanks in central

Alaska.

Under most circumstances a short offshore route

and longer onshore route would be desirable as a

means of reaching Prudhoe Bay, from an economic

perspective, however the Arctic coastal region of

the Yukon, NW Territories and Alaska brings

unique challenges. The closest landfall to the main

developments of the Beaufort Shelf is the area

between the Mackenzie delta to Tuktoyuktuk. A

landfall at Tuktoyuktuk represents the most easterly landfall and the longest onshore route to Prudhoe Bay, USA. Seven

offshore/ onshore coastal routes options to Prudhoe Bay have been considered. All routes effectively head west along the North

American continental shoreline each of the offshore options connect to the main route. These routes have been designated route

W1-O1 to W7-O7 from west to east with route W1-O1 being the shortest onshore and longest offshore route and route W7-O7

being the longest onshore and shortest offshore route. These routes are presented in Figure 12. It is clear that all, except the

longest offshore route (Route W1-O1), will have an associated onshore route that will pass through at least one national park or

Figure 12 Potential Offshore export pipline routes from the Central Beaufort

Shelf Area

1

2

3

4

5 6

7 W Routes

S R

oute

s

OTC 22563 9

wildlife reserve that are located along the coastline in both Canada and USA. In order to pass west to TAPS without crossing

these environmentally sensitive areas it would be necessary to propose a route that passes many hundreds of kilometres inland.

A route that passes so far south has a logical tie-in point to the TAPS system at Fairbanks, Alaska, rather than Prudhoe Bay. A

second routing south west to Fairbanks has therefore been considered for the three most easterly route offshore options that make

landfall in Canada. These routes are designated S5-O5, S6-O6 and S7-O7 (Figure 12).

Offshore Route options Summary The key features of the offshore pipeline routes are presented in Table 2. It is clear that the shortest routes east of the MacKenzie

trough on the eastern Beaufort shelf (routes O6 and O7) have significant portions of the route in water depths less than 50m and

as such will require a considerable amount of intervention

to ensure protection against Ice scour interaction. The

routes that landfall immediately west of the MacKenzie

Trough (routes O4 and O5) utilise the MacKenzie Trough

to route the pipeline in deep water close to the landfall and

therefore minimise the intervention required in water

depths less than 50m. The three longest routes (routes O1,

O2 and O3) cross the MacKenzie Trough in 300m water

depth and rise back onto the Yukon Shelf and follow the

55m contour before landfalling in the USA, all have

significant lengths in water depths less than 50m as they

approach the landfalls. The longest offshore route (route

O1) landfalls at Point Thompson nearly 480km west of the central Beaufort shelf. Purely from an offshore pipeline perspective

the best routes are routes O4 and O5 due to their relatively short length and the much shorter length of route requiring

intervention.

Onshore Route options Summary Onshore routes have been considered for each of the seven

offshore/onshore route options, however given that all routes

effectively head west along the North American continental

shoreline each of the offshore options tap into the main route

that passes from the most easterly landfall at Tuktoyaktuk,

Canada to Prudhoe Bay, USA. These routes have been

designated route W1 to W7 from west to east with route W1

the shortest onshore and longest offshore route and route W7

the longest onshore and shortest offshore route. Table 3 gives

an indication of the onshore route lengths and a summary of

the environmentally sensitive areas that are present along the

coastline in both Canada and USA. In order to pass west to

TAPS without crossing these environmentally sensitive areas

it is necessary to propose a route that passes many hundreds

of kilometres inland, to the south of the Ivvavik and Vuntut

National Parks in Canada and the Arctic National Wildlife

refuge and Yukon Flats National Wildlife Refuge in Alaska. A

route that passes so far south has a logical tie-in point to the

TAPS or Alaska LNG system at or near Fairbanks, Alaska

rather than Prudhoe Bay/Point Thompson. A second routing to

Fairbanks has therefore been considered for the three most

easterly route options that make landfall in Canada. These

routes are designated S5, S6 and S7. An onshore pipeline route

overview map is presented in Figure 13. The two routes east of

the MacKenzie delta (routes W6 and W7) are associated with

very long onshore routes along the Arctic coastline. They are

also associated with potentially difficult crossings of the

MacKenzie Delta area.

Table 2 Offshore Route Summary

Route Length (km)

Max Depth

(m)

Distance to Depth Contour from Landfall (km)

Max Slope (deg) 50m 30m 10m

O1 480.5 -300 75.6 30.0 9 1.0

O2 327.9 -300 33.0 13.5 1.5 1.0

O3 285.9 -300 41.2 17.0 1.9 1.0

O4 228.7 -212 8.2 1.5 0.5 1.5

O5 232.3 -75 16.6 2.6 0.9 0.8

O6 170.9 -63 110.4 81.0 49.0 0.1

O7 158.1 -63 87.0 67.0 37.0 0.2

Table 3 Onshore Route Summary

Route Onshore Distance

(km)

Max Elevation

(m)

Are

a 1

00

2

Arc

tic

Nat

ion

al

Wild

life

Ref

uge

Her

sch

el Is

lan

d

Par

k

Ivva

vik

Nat

ion

al

Par

k

Mac

ken

zie

Del

ta

W1 102.1 26

W2 243.8 147 X

W3 309.1 152 X X

W4 378.8 152 X X X X

W5 452.2 152 X X X

W6 669.2 152 X X X X

W7 706.8 152 X X X X

S5 747.4 782

S6 898.5 782 X

S7 925.3 782 X

Figure 13 Onshore Route Options

W1

W2

W3 W4

W5 W6

S5

S6/7

S5/6/7

W7

10 OTC 22563

Export Route Summary

It is necessary to take both offshore and onshore routes into

account before selecting the optimum route. Table 4

combines the offshore and onshore routes. Based on the

combined length of route alone, combined route O2-W2 is

preferred. This route landfalls at Pokok Lagoon in Area 1002

of the ANWR and also has the least intervention requirement

in water depths of less than 50m for the three routes

landfalling in the USA. This route is not thought to be viable

for environmental and political reason, although recent

debates on opening up Area 1002 of ANWR to Oil and Gas

drilling may change the vability of an onshore pipeline

passing through this area.

Route O1-W1, landfalling at Point Thompson, USA is likely

to be the best route for exporting by the westerly coastal route

to Prudhoe Bay as it is the only route that avoids all Canadian and USA state and national parks. This route has the disadvantage

however of having a long approach to the landfall in water depths less than 50 water depth.

Of the export routes that landfall in Canada, combined route O5-S5 is likely to be the best route for exporting by the southerly

route to Fairbanks. This route landfalls at Kay Point just to the east of the Ivvavik National Park and avoids all Canadian and

USA state and national parks, wilderness areas and other restricted environmental areas. It also avoids the need to cross the

Mackenzie D0elta region and utilises the Mackenzie Trough to route the pipeline in deeper water which limits the length of

approach to the landfall in water depths less than 50m to 16km.

Conclusion It is concluded that if an export pipeline is adopted in preference to Tanker export from GBS, that the preferred export route is

to tie into TAPS at Prudhoe Bay via the

long offshore export route which

landfalls at Point Thompson as seen in

Figure 14. This route stays in water

depths greater than 50m for 80% of its

length and therefore avoids the

potential damaging effects of ice

gouging on the eastern Beaufort Shelf

and Alaskan/Yukon shelf. The route

however will require a significant

amount of pre-dreged trenching as it

turns towards its landfall at Point

Thompson with approximately 75km

less than 50m water depth and 9km less

than 10m water depth. The pipeline

will need to negotiate crossing the

MacKenzie Trough and will reach a

water depth of 300m.

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text/pubs_ann_ann2013_1400849527813_eng.pdf

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Arctic” http://www.usgs.gov/newsroom/article.asp?ID=1980#.VHsiejGsVbU

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Table 4 Export Pipeline options Summary

Route Max

Elevation (m)

Max Depth

(m)

Route Length (km)

Envi

ron

men

tal

Are

a C

ross

ing

Mac

ken

zie

D

elta

Dis

tan

ce t

o

50

m Is

ob

ath

(km

)

Offshore Onshore Total

O1-W1 26 -300 480 102 582 76

O2-W2 147 -300 328 244 572 X 33

O3-W3 152 -300 286 309 595 X 41

O4-W4 152 -212 229 379 608 X 8

O5-W5 152 -75 232 452 684 X 17

O6-W6 152 -63 171 669 840 X X 110

O7-W7 152 -63 158 707 865 X X 87

O5-S5 782 -75 232 747 980 17

O6-S6 782 -63 171 899 1070 X 110

O7-S7 782 -63 158 925 1083 X 87

W7

Figure 14 Selected export Route from the Beaufort Shelf

OTC 22563 11

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