An oil industry geologist credited with helping usher in a modern resurgence of resource extraction on the North Slope says he’s discovered a new area that could hold hundreds of millions of barrels of oil.
Bill Armstrong, CEO of Armstrong Oil and Gas company, hopes his discovery of the Sockeye-2 area near the Arctic National Wildlife Refuge will lead to increased oil production on the North Slope.
Reporter Alex DeMarban with the Anchorage Daily News wrote about Armstrong’s latest discovery, and says he has a solid reputation in the industry for major oil finds in Alaska.
This interview has been lightly edited for length and clarity.
Alex DeMarban: The major thing that he did was in 2013, he found the Pikka discovery, and that Pikka discovery revolutionized oil field activity and brought lots of interest to the western portion of the North Slope oil fields. And so what that has done is created a situation where these new fields that have been discovered, the oil that's going to come online is leading to a significant turnaround in oil production in Alaska, after we've had our oil production fall for decades from like 2 million barrels to like just 1/4 of that today, even less actually. But at any rate, now it's going to go up maybe 33%, and that hasn't happened in a long, long, long time. So he's opened up a new frontier for oil field activity with his Pikka discovery in 2013.
Wesley Early: Tell us a bit about Armstrong's latest discovery, Sockeye-2. Where is it, and what's his assessment of the value there?
AD: So Sockeye-2 is located somewhat close to the Arctic National Wildlife Refuge. So similar to the case of Pikka, which is on the western frontier of the North Slope oil fields, this is on the eastern frontier of the North Slope oil fields. So there's really not much over there. There's one other development near the ANWR border, and that is the Point Thompson oil field that ExxonMobil has, but that oil field, it's important in some ways, but it doesn't really produce much oil. And this is pretty much a new exploration area, just very little activity has happened out there. So it's on the eastern portion. What he's saying is, there's like 700 million barrels of oil there. That's just an early guess, but he's been pretty correct about estimates on his Pikka field as well. So 700 million barrels of oil is obviously worth billions of dollars, lots and lots of money. So it's not quite as big as Pikka or Willow. So it would be 700 million barrels compared to 2.5 billion barrels at Pikka , but still a significantly large field for Alaska.
WE: You interviewed several outside experts to get their take on Sockeye-2. What did they say?
AD: This is really interesting. For example, David Houseknecht, he's a longtime geologist with the USGS, the U.S. Geological Survey. And this guy, David Houseknecht, he knows the North Slope geology and oil field history like, it seems like, no one else. I mean, he can cite a well from 1976, just pull it up out of his head. You know, any time, any well, he pretty much has the answer right there in his head. He knows about it. So one thing that's interesting about him is he was aware early of this Pikka opportunity, and believed in it right away, and knew that this was something that had been overlooked in Alaska's North Slope, this type of geology for an oil discovery had been overlooked by other oil companies. And so early on, he was a believer in Pikka, and he's also, at this point, a believer in the Sockeye-2 well, which is the new discovery that Armstrong has. And then the other expert that I just talked to for this story is Mark Myers, who was the former director of the USGS and also was an engineer who looked for oil for ARCO, and he actually had attempted to find oil at what later turned out to be Pikka, and was just right on the edge of finding it, but overlooked it. And he also has great faith in Bill Armstrong, and believes also that he's onto something with this Sockeye-2 discovery and the other potential discoveries that are waiting to be found out there.
WE: And what do you think this discovery says about the potential for more large finds up on the North Slope?
AD: Well, based on what the experts are telling me, like David Houseknecht and Mark Myers, it sounds like there's, you know I guess I'm skeptical of lots of things, but I would say that it sounds like there's maybe solidly more than a 50% chance that this discovery is going to lead to other discoveries up there and could open up development on this east side of the oil fields. And it seems like there's a pretty good chance that that will happen. Myself personally, I'd maybe give it 50-50 but listening to these experts, maybe they're at 75%. They're pretty excited about it, or they give it a pretty high possibility of happening.
