Development Plans For The Hondo Field-Santa Barbara Channel

Abstract

Introduction I appreciate the opportunity to speak to you about Exxon's plans and activities for development in the Santa Barbara Channel. First, let me give you some background. Background Refer to Fig. 1. Oil activity in the Santa Barbara Channel is far from new. The first offshore wells anywhere in the world were drilled from piers at Summerland in 1896. Daring the 1920's and 1930's, drilling from piers or artificial islands ranged from one end of the channel to the other in state waters. The first production from an offshore platform in the Santa Barbara Channel was in 1958 platform in the Santa Barbara Channel was in 1958 from Standard of California's platform Hazel off Carpinteria. More than a dozen new fields subsequently were discovered and put into production from eight platforms in state waters. The first federal lease sale in the Santa Barbara Channel was held in Dec. 1966. In 1968, 2 years later, the Bureau of Land Management offered 110 tracts for lease on the OCS in the channel. Oil operators paid more than $600 million for the right to explore 71 of these tracts shown in yellow and orange on the map in Fig. 2. Exxon was a major participant, acquiring an interest in 47 tracts, shown in yellow, and investing $218 million. As you can see, Exxon obtained leases in several areas of the channel. However, our discoveries to date have been in the Santa Ynez Unit (outlined in black). Chevron, Shell, and Exxon are the leaseholders in the 83,000-acre Santa Ynez Unit, with Exxon as operator. Exxon has discovered three fields in the unit, Hondo, Pescado, and Sacate. The largest of these fields is Hondo, and it is being developed first. Development of Hondo will be multiphased (see Fig. 3). The initial phase involves a single platform from which 28 wells will develop the eastern half of the field. The primary reservoir in Hondo is the Monterey, a chert formation averaging 1,200 ft thick, which occurs at a depth of 8,000 ft subsea. The platform that Exxon set in the summer of 1976 is located in 850-ft water depth. Its location outside the bay area will require that all wells be drilled directionally. Exxon's preferred development plan utilized an onshore treating site, located 1 1/2 miles inland in a canyon. Here, we would dewater and remove H2S from the crude before loading on a tanker through a marine terminal consisting of a single-anchor leg mooring (SALM) buoy. Associated gas also would be brought to shore for conditioning, including sweetening and sulfur recovery, prior to delivery into a gas transmission line crossing Exxon's property. The necessary approvals for this property. The necessary approvals for this development plan were obtained from the Dept. of Interior, the FPC, the County of Santa Barbara, and the Regional Coastal Zone Commission. This process included three environmental impact statements, 20 public hearings, and a county referendum. However, public hearings, and a county referendum. However, on appeal, the State Coastal Zone Commission denied our plan, substituting one with conditions that, among others, could have required construction of a pipeline from the onshore site to Los Angeles or some pipeline from the onshore site to Los Angeles or some other undesignated location. Since such a pipeline would have no environmental advantage and would be economically unattractive, the conditions were unacceptable to Exxon. As a result of this, Exxon elected to proceed with an alternative plan that also had been approved by the DOI. This plan utilizes a floating storage and treating facility as a substitute for an onshore plant. This offshore storage and treating (OS and T) plant. This offshore storage and treating (OS and T) vessel will be moored to a SALM in 490-ft water depth, 8,500 ft from the platform in federal waters. See Fig. 4. It is being designed to treat initially up to 40,000 BOPD, 15,000 BWPD, and 11 MMcf/D of gas for fuel. Treated crude oil will be transported to refineries by a shuttle tanker that will moor to the OS and T in tandem. Provisions are made for future expansion of the OS and T to handle 60,000 BOPD, the peak expected from full Hondo development.