The federal government has granted BP Exploration (Alaska) Inc. a suspension of production on the company’s offshore Liberty unit leases in the Beaufort Sea.
The action extends the leases by two years and gives BP time to develop a new approach on its stalled Liberty project.
In a recent letter to BP, the Interior Department’s Bureau of Safety and Environmental Enforcement, or BSEE, set a deadline of Dec. 31, 2014, to submit a new development and production plan for Liberty. The agency is requiring BP to turn in progress reports every three months.
Once the plan is in, the Interior Department will conduct a regulatory review and issue a record of decision.
BP is now aiming to achieve production from the Liberty unit by December 2020, the letter says. The letter makes mention of “final design, fabrication and construction,” but does not specify exactly how BP plans to go about tapping the Liberty oil deposit.
BP had been moving on an ambitious and technically daunting plan to develop the offshore field using ultra extended-reach drilling from an artificial island built at BP’s neighboring Endicott field. A monster rig built by Parker Drilling Co. was positioned on the island.
But drilling never began, and in November 2010, BP suspended the project. The company would later say the rig needed extensive modifications, and cited an “evolving regulatory framework.”
Liberty is located in shallow water, about 20 feet deep, in the Beaufort Sea about six miles offshore and 15 miles east of Prudhoe Bay.
BP drilled and tested Liberty No. 1, the discovery well, in early 1997, and announced a commercial discovery estimated at more than 100 million barrels of recoverable oil.
—Wesley Loy
See story in Feb. 24 issue, available online at 11 a.m. Friday, Feb. 22 at www.PetroleumNews.com
