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October 19, 2011 --- Vol. 17, No. 89October 2011

Barron gives Escopeta green light to keep on drilling

In an Oct. 13 letter to Escopeta Oil, Bill Barron said the independent could continue drilling Kitchen Lights No. 1 with the Spartan 151 jack-up rig, as long as it was in compliance with all other state and federal agencies, including a successful test of its blowout preventer with the Alaska Oil and Gas Conservation Commission.

Barron is the director of the Division of Oil and Gas, part of the Alaska Department of Natural Resources.

Escopeta Strategic Officer Steve Sutherlin said on Oct. 12 that the blowout test had been successful.

At that time Escopeta had reached a depth of 4,933 feet at the offshore Cook Inlet well, the approximate depth at which Barron had asked the company in a Sept. 2 letter to temporarily stop work in order to evaluate and determine “the reasonableness and prudence of moving forward with additional drilling.”

Barron did note in his Oct. 13 letter that Escopeta has to stop drilling into hydrocarbon formations by Oct. 31 per condition 7 of its Oil Discharge Prevention and Contingency Plan, which was approved in June by the Alaska Department of Environmental Conservation.

—Kay Cashman

Customs fines Escopeta $15 million for Jones Act violation

On Oct. 13, the Anchorage office of U.S. Customs and Border Protection levied a $15 million fine against Escopeta Oil Company LLC for violating the U.S. Jones Act when it transported the Spartan 151 jack-up rig from Freeport, Texas, to Esquimalt, Canada, using a foreign-flagged vessel, after which the rig was towed to Alaska,.

Customs also said Escopeta could “file a petition for relief” within 60 days with its fines, penalties and forfeitures officer in Anchorage, Patrick McGownd, who signed the letter notifying Escopeta of the penalty.

—Kay Cashman

See full stories in the Oct. 23 edition of Petroleum News, which will be online Friday at 11 a.m. at www.petroleumnews.com.

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