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Weekly UpdatesWe all know that most of the State of Alaska's income is derived from North Slope oil that flows through the trans-Alaska oil pipeline. Cook Inlet also provides a small amount of royalty income to the state.
What many Alaskans and outsiders don't know is where and when the Alaska oil story began.
Way back in 1896, a prospector by the name of Thomas White recognized the importance of natural oil seeping out of the ground near Katalla, located along the Gulf of Alaska east of Cordova. He staked the first petroleum claims in the state. Rounding up investors was the next step and that took until 1901. In 1902, the Alaska Development Co. obtained a flow of oil after drilling well No. 1 to a total depth of 366 feet. The well was drilled to a depth of 270 feet in the previous year and shut down owing to drilling difficulties.
Following the successful deepening and completion of well No. 1, at least 37 other wells were drilled in the area between 1902 and 1933. Eight wells failed because of malfunctions in drilling equipment or because they failed to reach the prospective oil-bearing rock strata. Eleven wells are reported to have yielded little or no oil or to have contained only "shows." Eighteen wells in the claim at the head of Katalla Slough produced oil. These wells ranged in depth from 366 feet to 1,810 feet.
A GROUP EFFORT
Several other operators besides Alaska Development Co. participated in the drilling of these wells and seven others not in the Katalla Slough claim. These included The Alaska Petroleum and Coal Co., Clarence Cunningham, The Amalgamated Development Co., The St. Elias Oil Co., and The Alaska Coal Oil Co.
Actual drilling was accomplished by erecting wooden derricks and then using the percussion cable-tool method. A heavy drill bit was hoisted up in the derrick and then dropped repeatedly. When rock chips accumulated in the hole preventing further drilling, a bailer was lowered in the hole to remove the cuttings. This drill-bail, drill-bail technology method is still used today to drill many water wells.
Some of the Katalla wells produced casinghead gas. This gas was used to fire steam engine boilers in the drilling of other wells.
THE FIRST REFINERY
A small experimental refinery was built near Katalla Slough a short distance west of the oil field in 1911, and some oil was pumped or refined. The next year the refinery was expanded and went into regular operation with gasoline and other products being produced. Except for that used in the Katalla-Controller Bay area, most of the refinery products were used principally at Cordova, which is located about 55 miles northwest of Katalla.
In 1933, the refinery was partially destroyed by fire and this brought all oil production to a halt. The wells were capped after producing 154,000 barrels of oil and were never reactivated.
TIME'S TOLL
Time has taken its toll and today all buildings and derricks are no longer standing. The oil field and refinery site are almost entirely covered by lush vegetation that thrives on the annual 150-plus inches of precipitation. The town of Katalla, which was a thriving community of a few thousand before Anchorage was even built, was located a short distance west of the oil field. It gradually became deserted as those people dependent on the oil left. For a time, a few people engaged in fishing and trapping occupations stayed on hoping for the big oil boom to hit, then they too left. Today the town is completely abandoned.
Katalla, fronting on the Pacific Ocean, was once a lively oil and coal town and a proposed railroad terminus for some years after the turn of the century. It has been reported that the major reason for the abandonment was largely due to the lack of a harbor. The small spit-protected harbor that the town had for awhile was completely destroyed by a large Gulf of Alaska storm. At its heyday, the town contained six or seven saloons so business must have been good.
New INTEREST
For years Katalla was all but forgotten and then in the 1950s, the lure of big oil brought oil men back into the area for a flurry of exploration, which resulted in the drilling of several wells along the coast east of Katalla. All wells were unsuccessful and interest in the area waned.
Then came the large Cook Inlet oil discoveries in the 1960s and oil men once again thought of Katalla. New interest was generated by a few small operators who all failed to develop any producing properties in the area.
Prospectors and oil explorationists who tramped the upland areas along the Gulf of Alaska often came across natural oil seeps such as was discovered at Katalla. Geologists believe that the source rocks for these oil seeps are part of the Poul Creek Formation of Oligocene age (24 million to 34 million years ago). These strata crop out in the mountains east of Katalla and in the subsurface in the Robinson Mountains. Standard Oil Co. even drilled a well near one of the largest oil seeps located near Johnston Creek, which produced a gas "show" but was capped.
The oil seeps are often manifested by a scum of oxidized oil lying on a small pool of water and typically have a yellowish-greenish iridescent color. The creek downstream from the Johnston Creek seep has trout in the water as well as all of the aquatic plants that inhabit the area, so the seep does not seem to alter that stream environment. Heavy rainfall in the area helps wash the oil downstream and into the Gulf of Alaska. It has been reported that the Johnston Creek seep puts out about 1/2 barrel of oil a day. When you see one of these, it is easy to imagine why prospectors of old were so exited and why oil men wanted to drill to strike it rich.
So, now you know that Alaska oil has a history that is more than a 100 years old, and Katalla played a key part.
Abridged Alaska Oil History
1990s to Present
Exploration continues at a slowerpace on the North Slope, as well as in the Cook Inlet Basin. Prudhoe Bay and Kuparuk on production decline.
1970s to 1990s
Numerous Outer Continental Shelf/ease sales held offshore Alaska and onshore on state lands. Major oil field discoveries at Kuparuk onshore and Endicott offshore, and several adjacent smaller fields discovered.
1977
North Slope oil begins to flow through the transAlaska oil pipeline and continues to present.
1974 to 1977
Pipeline and haul road construction.
1973
Pipeline Authorization Act passed.
1971 to 1972
Pipeline ownership decided with seven oil company owners.
1971
Native Claims Settlement Act passed.
1969 to Present
Drilling in Prudhoe Bay Field.
1969
September, $900 million North Slope Lease Sale.
1969
Tanker SS Manhattan makes a Northwest Passage trip to move North Slope oil.
1967
December, ARCO drills Prudhoe Bay State No. I discovery well and confirmation wells drilled.
1963 to 1965
Several North Slope exploration wells drilled.
1962 to 1965
Cook Inlet oil and gas fields discovered (Middle Ground Shoal, Granite Point, North Cook Inlet Gas field).
1965
Shell installs Cook Inlet Platform on Middle Ground Shoal.
1962
Pan Am's (AMOCO) platform installed on Middle Ground Shoal in Cook Inlet.
1959 to 1960
Several oil companies open exploration offices in Anchorage and conduct seismic surveys onshore and offshore.
1960
State of Alaska/and selection begins and state selects land in the Prudhoe Bay area as part of its 104 million acres of land granted by Congress.
1959
The Alaska Statehood Act passes Congress.
1958
Shipping of oil from Swanson River Field begins.
1957
Richfield's Swanson River discovery on Alaska's Kenai Peninsula.
1954
Rich field files on Swanson River acreage.
1950s
Several companies drill exploration wells along the Gulf of Alaska, Copper River Basin and Cook Inlet Basin.
1945 to 1953
U.S. Navy drilling in National Petroleum Reserve on North Slope.
1933
Katalla oil refinery burns and production shuts down.
1902 to 1904 and in 1920s
Exploration drilling (no discoveries) on Alaska Peninsula.
1902 to 1933
Drilling in the Katalla Oil Field and exploration east in the upland areas of the Gulf of Alaska.
1901
Drilling starts in the Katalla Oil Field.
1896 to 1900
Arrangements made for financing the exploration of Katalla prospect.
1896
Oil seep discovered at Katalla by prospector Thomas White.
Irven F. Palmer Jr. is a retired geologist; a current board member of a large Alaska corporation; an active aviator who has flown his small plane to most areas of the state," an artist who does work in several mediums, but mostly water colors; and a freelance writer. He arrived in Alaska in 1967, though recently moved to Washington state to be near his children. He spends his summers in Alaska on the Kenai Peninsula.
He was a geologist for Continental Oil Co. and had the opportunity to visit the two site of Katalla, the Katalla oil field, refinery site and the upland areas of the Gulf of Alaska several times. He recorded those visits with notes and photographs.
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