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BP says owners worked issue of more MI AOGCC’s 1995 CO 360 decision asked Prudhoe owners to report on plans to increase miscible injectant; agency got explanation Kristen Nelson Petroleum News
In 1995 the Alaska Oil and Gas Conservation decided, in Conservation Order 360, that maximum ultimate recovery from Prudhoe Bay would be achieved by maximizing production of natural gas liquids, NGLs, for sale down the trans-Alaska oil pipeline, rather than by maximizing miscible injectant production for enhanced oil recovery.
The operators at the time assured the commission that there was adequate MI, but as part of that order the commission required a report on plans to increase the volume of miscible injectant, MI, available for enhanced oil recovery, EOR.
Following a 2012 hearing on potential waste of propane at Prudhoe, the commission found propane was not being wasted, but came away from the propane hearing questioning whether sufficient MI was being produced and whether it needed to revisit CO 360.
That conservation order settled a dispute between the major Prudhoe Bay working owners — then ARCO, BP and Exxon — over whether natural gas liquids from the field should preferentially be sold down the trans-Alaska oil pipeline as NGLs or used to create MI for enhanced oil recovery, EOR. At that time the owners held different percentages of the Prudhoe Bay gas cap and oil rim. The field was also split geographically, with half operated by ARCO and half by BP. BP held a larger portion of the oil rim, which meant it benefitted if more MI was created for EOR, while ARCO and Exxon held more of the gas rim, which meant they benefitted if more NGLs were sold with the oil.
Alignment of oil rim and gas cap ownership occurred as a result of the purchase by Phillips Petroleum of ARCO’s Alaska assets in 2000. Also as a result of that sale, BP also took over operatorship of the entire field.
The commission held a Jan. 7 hearing on the issue of revisiting CO 360 (see stories in Jan. 12 and Jan. 26 issues).
One question the commission asked was whether the working interest owners had ever provided the report required by the order on plans to increase the volume of MI available for EOR.
The commission said it was unable to find a copy of that report.
Was the report filed, the commission asked? If so, could the companies please provide a copy?
‘Report to commission’ In a Jan. 29 follow-up to the commission on questions remaining from the Jan. 7 hearing, attorney Jeffrey Leppo of Stoel Rives, responding for Prudhoe operator BP, provided copies of correspondence on the MI issue and a record of a meeting.
A Dec. 19, 1996, meeting was held, including AOGCC, the Department of Natural Resources and the Prudhoe Bay working interest owners.
Leppo said the meeting agenda and related letters showed that the agency review held Dec. 19, 1996, “was understood by all the parties to functionally satisfy” the Dec. 15, 1996, deadline in CO 360. He said that from BP’s perspective, the correspondence and meeting agenda copied to the commission, “substantiate that the terms ‘report’ and ‘plan’ in paragraph 1.B of the AOGCC’s order were intended by the AOGCC and understood by the operators to require an explanation to the AOGCC, but not a formal filing or document. The letters also document an ongoing dialogue between the PBU operators and the AOGCC regarding planning for increased manufacture of MI through the ‘MIX-IPF project.’”
ARCO took the lead ARCO took the lead in a conceptual study called miscible injectant rate enhancement or MIRE, initiated in the fall of 1995 and conducted by a team from the major owners, Leppo said. The study, completed in the late winter or spring of 1996, examined methods for increasing MI to at least 600 million cubic feet per day, and recommended further engineering design and study focus on MI expansion through increased pressure and flow, the MIX-IPF project option, which focused on adding a new booster compressor module at the Central Gas Facility, CGF, and also involved upgrades to MI compressors, refrigeration compressors and CGF gas injection compressors.
Anticipated benefits of the MIX-IPF were an increase of 500 million cubic feet per day in the overall field gas rate, a 100 million cubic feet per day increase in MI, a 2,000 barrels per day increase in NGLs and a 20,000 bpd increase in oil production.
Initially there was an increase in gas rate, oil and NGL production and manufacture of MI. But there were significant problems after startup with low temperature separator gas/gas exchanges, which were replaced in 2003.
Rates again temporarily increased, but new problems resulted in the gas/gas exchangers, again reducing incremental MI and NGL benefits of the MIX-IPF project. The units were replaced in late 2005.
By the time the 2005 replacements were made, the MIX-IPF project could not achieve the 600 million cubic feet per day of MI “because of the leaning out of the CGF feed gas, accelerated by the use of MI for EOR operations” at Point McIntyre and at other satellite pools, Leppo said.
Project undertaken While the MIX-IPF project was undertaken with the goal of increasing MI to some 600 million cubic feet per day, as specified in CO 360, “problems with implementation reduced the benefits of the project for several years,” Leppo told the commission.
When the projects were fully addressed, the baseline level of MI production had dropped from more than 500 million cubic feet per day in 1996-97 to less than 300 million cubic feet, “due to the leaning of the CGF feed gas, accelerated by important beneficial changes in the use of MI for EOR.” Because the CGF feed gas had become leaner, benefits of the MIX-IPF project were not sufficient to raise the MI level to 600 million cubic feet per day.
Other projects considered BP has considered two other major projects since 1995 to increase MI for EOR without reducing extraction of maximum blendable NGLs, Leppo told the commission.
It studied the miscible injectant expansion by environmental reduction or MIXER concept in 2002, which looked at a new cryogenic gas plant using surplus gas lift compression to generate more MI while reducing carbon dioxide emissions. “After study, the concept was not pursued because of both poor yields and poor economics,” Leppo said.
More recently, BP evaluated adding a fourth low temperature separator to the CGF, but that proposal, Leppo said, proved “prohibitively expensive.”
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