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GHX-2: jump-starting Prudhoe Bay.

The new gas-handling (GHX-2) modules on the North Slope will extend the life of the northern oilfields.

With crude production largely on the wane during the first half of 1993, the early arrival of this year's sealift on the North Slope brought welcomed relief to producers. On board were a dozen modules aimed at giving Alaska's largest oilfield at Prudhoe Bay a much-needed shot in the arm.

In fact, project coordinator Arco Alaska expected to have the so-called GHX-2 gas-handling modules installed and operating by the end of September, weeks ahead of schedule. GHX-2 will give Prudhoe Bay output a temporary boost of 100,000 barrels a day, half of which will come this year and half in late 1994, after the remaining modules are delivered to the North Slope next summer.

Actually, the $1.2-billion GHX project is designed to keep Prudhoe Bay production, in natural decline since 1988, from plummeting while extending the life of North America's most prolific oil reservoir. Through GHX-1 (completed in 1990) and GHX-2, Arco estimates an additional 800 million barrels of oil can be recovered over the field's lifetime.

As the Prudhoe Bay field grows older, more natural gas rises to the surface with the oil -- a natural phenomenon that inhibits oil production because of the difficulty in dealing with large volumes of gas. GHX-2 will increase daily gas-handling from 5.2 billion cubic feet a day to 7.5 billion cubic feet a day, most of which will be reinjected into the field's gas cap. The gas also serves to maintain reservoir pressure.

"The natural evolution of producing a reservoir is decline over time. We're trying to arrest that decline, and the best we probably can do is to create a momentary leveling off of that before we continue the decline," explains Charlton Breon, a member of Arco's GHX-2 design team.

Prudhoe Bay production has fallen from an annual average peak of 1.6 million barrels a day to just over 1 million barrels a day but still represents roughly three-quarters of North Slope output. Without the GHX project, field production would be plummeting at the rate of 6 percent to 8 percent a year.

Nevertheless, total Alaska North Slope (ANS) production -- representing 85 percent of state revenues and 25 percent of the U.S. domestic oil supply -- was well below forecasts going into the third quarter of this year. In July, for example, ANS yields dropped to 1.447 million barrels a day, the lowest monthly average in 13 years. And for the first time since 1978, Prudhoe Bay fell below 1 million barrels a day for the month, largely because preparation work for the GHX-2 project forced a cutback in oil production. Additional hits occurred in August because of on-going field work related to GHX-2 module installations.

But early arrival of the modules, coupled with new technologies and experience gained from GHX-1, is allowing Arco and its contractors to complete this year's work well ahead of schedule.

Built in a converted sugar cane field in New Iberia, La., the 17,000 tons of GHX-2 gas-handling modules were placed on barges at the construction site and maneuvered through a 40-mile network of inland canals to the Gulf coast. There, the modules were loaded onto three football field-size ocean barges for the 6,000-mile journey to Alaska via the Panama Canal.

Troubled Waters

It was a record arrival for a North Slope sealift, departing New Iberia on May 24 and arriving at Prudhoe Bay on July 29. But it wasn't all smooth sailing.

The sealift was chased by a hurricane in the Gulf of Mexico. And off the coast of California, the tugs and barges encountered 60-knot winds and huge waves that slowed the pace to seven miles a day, some 180 miles less than a typical day's passage. The waves were so large they crashed over the top of the 13-foot-high wave shield on one barge, crushing a metal shelter and ripping protective siding from a module.

Fortunately, the sealift arrived at Point Barrow just after one storm cleared a route through the ice pack and just before another moved the ice back.

"We had nice sunny days and a south wind and the ice was out, so we came right around. If it had been a day later, we'd still be waiting for our barges," recalls Mike Clendennen, Arco's GHX-2 construction supervisor on the slope.

This year's sealift contained three modules in the 5,000-ton range, the largest ever shipped to the North Slope. One was headed to the gas-expansion annex at Gathering Center No. 1, operated by BP Exploration (Alaska) in the western operating area. The others, tandem compressor units, went to the Central Gas Facility, operated by Arco. The compressors are powered by a pair of 60,000-horsepower gas-fired turbines.

Heavy Haulers

The three 5,000-ton modules also are the largest ever moved anywhere in the world by trailer. In fact, Arco hired Scheuerle, a renowned German company, to build a special $14-million trailer to transport the modules from Prudhoe Bay's West Dock along 10 miles of gravel roads to their destinations. The trailer has 32 axles, 512 tires and 36 computers to steer the apparatus and operate its hydraulic system. Top speed is 2 miles per hour.

"This new trailer took a lot of work, because there is a lot of relationship between the module design and trailer. This is one of the largest trailers in the world, and it's a world-class move," says Mike McKenna, construction logistics coordinator for Ralph M. Parsons Co., prime contractor for GHX-2 module design and engineering.

In addition to new technologies in trailer design and favorable weather conditions in the Beaufort Sea, lessons learned from GHX-1 are helping to move the second phase of gas-handling along at a more rapid pace than initially planned. Arco had thought it would be October or November before GHX-2 could be brought on line. That changed.

Even before the modules reached the North Slope, "They were functionally checked out in terms of all the equipment running and all the instrumentation being viable and calibrated," says Arco's Breon. "The work we need to do up here is connecting the piping systems, electrical systems and control systems."

Breon also notes that the longer trailer, measuring 260 feet by 32 feet, means Arco can build longer but fewer modules to fit the space.

"We are putting more equipment inside of these modules than we have in previous sealift years," he says. "There are probably six major modules associated with GHX-2. In prior years, it may have taken 10 modules for the same amount of work.

"Our goal has always been to get the modules to the foundations," he adds, "and this allows us to do it in bigger and bigger chunks. We've taken advantage of and pushed the envelope of new technology, in terms of oilfield equipment and logistics of how we design arctic projects."

Faster Production

Joe Albano, Arco's construction/logistics engineer, adds that the 21,000 tons of remaining GHX-2 modules under construction in New Iberia are scheduled to be completed in December, months before they are to be shipped to Alaska. He attributes faster production to constant performance evaluation and a duplication of designs, especially for large compressor and annex modules.

Says Albano, "When you buy all your materials for one project because they are cloned, you've got materials sitting there. Now you can fine-tune the construction process and do things in the most efficient way."

While the first phase of the GHX-2 project will create only about 50 permanent jobs, it created about 1,500 construction jobs in New Iberia and about 950 jobs on the North Slope during peak employment last March. Fluor Daniel of Irvine, Calif., fabricated the modules in New Iberia and Veco International of Anchorage is installing them.

Prudhoe Bay owners also have spread their GHX-2 money around the world, purchasing an estimated $327 million in materials from 700 to 800 vendors in some 37 states and a number of foreign countries, including Germany and Japan. Of the $1.2 billion in total costs for the project, about 40 percent went to GHX-1 and the rest to GHX-2.

Says Parsons' McKenna, "There aren't that many billion dollar projects in the world today. So when you're talking a billion dollars, you're talking world-class."
COPYRIGHT 1993 Alaska Business Publishing Company, Inc.
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Title Annotation:Northern Slope gas-handling modules
Author:Tyson, Ray
Publication:Alaska Business Monthly
Date:Oct 1, 1993
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