First-Hand:Prudhoe Bay Permafrost, the Cold War, and the CIA: Nothing Can Be So Bad That It Cannot Get Worse

Submitted by Stan Christman

In 1969, a few months after drilling the first few Alaska Prudhoe Bay development wells, a surface casing developed unexpected pressure. Despite repeated bleed-offs, the pressure kept returning. I was Humble Oil’s drilling engineer contact for the Prudhoe Bay discovery, working with the two operators, Arco and BP. Pressure was also on the production tubing, even though the subsurface safety valve (SCSSV) had been closed and successfully bled off earlier (valve at a depth of 1800 feet, to be below the permafrost) A wireline unit tried to pull the retrievable SCSSV, but ran into an obstruction. Soon, other wells developed similar symptoms. It was becoming apparent that a potentially serious problem existed.

The workover from Hell

A drilling rig was moved to workover the well, i.e., to investigate and repair. Over the next several days, the news kept getting worse. The SCSSV’s could not be opened, so the well could not be killed by pumping mud to the bottom. It was full of live oil with pressures over 1200 psi out to the surface casing, and connected to a very productive reservoir.

A temperature survey was run to the valve, and it was below freezing at the valve. Ice in the valve? The permafrost was deeper than had been previously interpreted from minimum drill logging temperatures. First lesson: the log temperature adjustment method used elsewhere was not good in permafrost; the return to undisturbed temperature profile takes longer, months. Later forensics revealed that the SCSSVs had been damaged by the expansion of some bypassed water freezing in the valve mechanisms.

Complex and risky operations proceeded, first successfully over-balancing the well with 22 ppg diesel (and barite) down to the leaking SCSSV at 1800 ft.

The tubing had its packer at the subsurface safety valve, and it would not release. Swedged out, cut, and pulled the upper 4½” tubing. The crews discovered several collapse points, and the 9 5/8” production casing was also collapsed at the same depths. Cut and pull that (getting the packer whose slips had been pushed through the casing by ice plus the ‘casing retrievable’ SCSSV).

It was clear that the 9 5/8” collapsed from freezing of some bypassed water that had remained in the annulus. The burst rating of the outer pipe was greater than the collapse rating of the inner pipe. Second lesson: do better at removing all water.

And next the 13 3/8” surface casing was also found collapsed, but albeit at only one depth. This collapse was more troubling, as it did not seem to make sense because the next annulus at that depth was inside a 20 inch casing, which had a much lower burst rating than the heavy-wall 13 3/8” casing collapse rating. Instead of the collapse, any water should have burst the 20-inch … unless the permafrost formations were much stronger than imagined.

“Permafrost freezeback”

Prudhoe permafrost zones are silts, sands, and gravels whose pore water is frozen. The oil industry ‘knew’ from drilling and fracturing technology that the upper limit of borehole pressure was essentially equal to the overburden weight, which at Prudhoe was about 0.8 psi/ft. The 20-inch casing was good for 1.0 psi/ft. (at the depth of the collapse).

The permafrost thaws to a few feet radius during drilling of the well. After the well is left, the permafrost slowly refreezes. As it does, the water expands and the added volume seeks relief by deformation and fracturing of the adjacent permafrost. Except now it looked like the permafrost might somehow be stronger than the 20-inch casing.

“Fracking” the permafrost

So to test the idea, after one of the active rigs set its 20” casing at about 1000 feet, a pump-in test was performed. The pump pressure rose steadily until the pressure flattened at 1.6 psi/ft. No apparent break back, i.e. fracture initiation. Pumping stopped, but the pressure remained. And when the pressure was bled off, nearly all of the pumped fluid (diesel) came back.

So the normal rock technology did not apply to permafrost. Lesson three: the permafrost was very strong. The Prudhoe Bay casing program was going to change.

Thaw subsidence

Previously, the design question of possible subsidence from thawing had been identified, with assumed compression loading on the well. So, the early development wells had ‘jack-screw’ wellheads, which could re-tension the production casing to offset subsidence, similar to what had been done along the Gulf Coast for fresh water withdrawal subsidence. The partners, BP, Arco, Exxon, and others had continued working on the thaw technology. Now, the costly freezeback damage punctuated that the permafrost could have surprises.

Siberia: a field named Tazov

As it happened, Prudhoe Bay was not the world’s first in thick permafrost. That distinction was the large Tazov field in Siberia, on the USSR ’s annual list of large gas fields starting about 1966. Until it was quietly removed in 1969.

Rumors circulated in the oil patch that the Russians had drilled several development wells, but something had gone terribly wrong. Some geologists who had visited the region related that the residents spoke of wells blowing out and could not be shut-off.

Humble Research obtained some of the first commercial satellite photos of the Tazov area, and, while the resolution was too poor to see any wells, roads, any fires, the ground was oddly different for miles downwind. Didn’t look like smoke? Maybe dead vegetation from gas condensate?

“We need to talk with the Russians.” But in those Cold War days, how? Humble had a Canadian affiliate, Imperial Oil, that was involved with an upcoming Arctic drilling conference in Calgary that the “Russians are coming” to.

At the conference, an Imperial drilling engineer asked the Russian delegate, “What happened at Tazov?” The response was telling “Oh, Tazov! Yes, very big problem. Unfortunately, there is not enough time to talk about it here.” Equaled “Nyet”.

We pieced together a guess. It was surmised that several wells had been completed, apparently not too far apart at the surface, and several months later, due to freezeback and likely no subsurface safety valves, one by one, gas got through the casings within the permafrost. We further assumed that the reservoir productivity and gas rates were so high that the relief well techniques (that Russia knew about), if tried, did not work. It appeared that Tazov was effectively depleted in a couple of years.

I never really understood why information about the event was stifled, national pride perhaps. Until 2009.

The CIA knew something went wrong at Tazov

In 2009, I found a declassified CIA 1970 Intelligence Report entitled “Prospects for Continued Soviet Exports of Petroleum”, and following are excerpts that explain much: [1]

“The USSR has abundant potential resources of petroleum, both onshore and offshore, that could make it the world's leading producer of petroleum by the end of the 20th century. However, 30% to 40% of these reserves are located in permafrost regions where their exploitation will be difficult and costly.”

“In recent years exports of oil have been the largest single source of foreign exchange earnings for the Soviet Union . Since 1955, annual hard currency earnings from oil exports to Free World countries rose from $10 million to a maximum of $375 million in 1968. During the past five, Soviet oil sales to the industrialized countries of the Free World earned a total of $1.5 billion in hard currency.”

“In January 1970, Soviet policymakers announced that development of oil and gas reserves in Western Siberia would have top priority during the next decade. Annual production of oil from this region is scheduled to reach 100-120 million tons by 1975 and 230-260 million tons by 1980.”

“As production of gas moves eastward to the remote, permafrost regions of West Siberia , the development problems become more severe. It is difficult for seismic equipment to detect the presence of oil and gas structures in permafrost areas, and in West Siberia permafrost is encountered at depths up to 500 meters. Therefore, only by drilling can an accurate delineation of the petroleum-bearing structure be obtained. Such drilling operations are difficult, especially if insulation is not supplied around the well bores to prevent the permafrost from thawing. Warm flows of gas at elevated temperatures can thaw permafrost up to 6 meters around the well and cause the casing to collapse, with subsequent loss of the borehole. Several producing gas wells in the large Tazov field developed ruptures in the permafrost surrounding the well, allowed the gas to escape, and destroyed a portion of the gas deposit.”

“The problems of developing natural gas reserves in permafrost regions without adequate modern equipment and technology, coupled with shortages of large-diameter pipe and matching valves and compressors will make fulfillment of production goals in 1975 and 1980 impossible.”

“The strong Soviet need for hard currency could motivate planners to increase exports to the Free World and let the East European countries (fend for themselves). However, it is unlikely that Eastern Europe could afford that. Moreover, from the Soviet point of view, this course of action would have the disadvantage of reducing East European dependence on the USSR .”

The CIA view that Tazov well damage was due to thaw subsidence is dubious, since that type of damage should take several years of production to develop, and it is not clear that a gas pipeline existed then. It is likely that CIA (or the Russians) did not yet know about freezeback technology, so adopted the only permafrost problem that was then known.

At the higher level, this report adds up to a CIA forecast that the USSR would run out of real money in the 1980’s, and it would be partly due to permafrost. And that is exactly what happened with the economic collapse of the Soviet Union.

And the Cold War ended.