BP aims for billions more barrels from Prudhoe Bay

By Robert Campbell

ANCHORAGE (Reuters) - Operator BP (BP.L: Quote, Profile, Research, Stock Buzz) expects to wring at least 2 billion barrels more crude from Alaska's Prudhoe Bay oilfield, even after the ageing giant has yielded over 11 billion barrels, far more than thought possible when it was discovered.

In addition to coaxing more medium sour crude out of the most productive field in the United States, BP is eyeing the once worthless shallow reservoirs of heavier oil that have become valuable as oil prices have surged to above $100 a barrel.

"No field the size of Prudhoe Bay has ever been shut in," said Gordon Pospisil, a senior BP petroleum engineer who is leading the effort to tap the field's heavy oil reservoirs.

"We're still drilling 60 or 70 new wells a year and it comes down to a progression of technology, the resource value and the opportunity to access a very large oil in place volume using modern drilling techniques."

BP's focus is returning to boosting recovery rates at Prudhoe Bay, as it nears completion of a two-year project to rebuild the field's transit pipelines after serious corrosion led to major spills and shutdowns in 2006. The problems cost it millions of dollars in fines and tarnished its carefully constructed reputation as a progressive oil company.

Output at Prudhoe peaked at 1.5 million barrels per day (bpd) before beginning to decline in 1988.

The field now pumps less than 400,000 bpd and production is declining at about 6 percent a year, yet remains the biggest producer in the United States.

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