Hilcorp Alaska LLC is working to revive several federally managed units in Cook Inlet.
While the local subsidiary of the Houston-based independent has already garnered considerable attention for its work to improve production rates at other producing fields across the Cook Inlet region, particularly the federal Swanson River unit, the company is just beginning campaigns at the federal Beaver Creek, Birch Hill and Sterling units.
Facilities upgrades
Hilcorp is currently upgrading facilities at the Beaver Creek unit. The company repaired or upgraded at least four pads last year and planned an even larger program this year, according to information in a plan of development running through March 1, 2016. The current program includes upgrades on compressors, pumps, engines, electrical and mechanical equipment, piping and flowlines at the nearly 50-year-old oil and gas field.
Alongside the facilities maintenance, Hilcorp has also been drilling wells and sidetracks and conducting workover activities on existing wells. The company told officials it drilled seven wells or sidetracks and conducted maintenance on eight existing wells in 2014.
The drilling program included three wells and four sidetracks.
The wells drilled at the end of the year came online in December: BCU 23 into the Beluga, BCU 24 into the Beluga and Tyonek and BCU 25 into the Sterling B4 interval.
The sidetracks were drilled earlier in the year. The BCU 1B sidetrack into the Beluga came online in April 2014. The BCU 14A sidetrack into the Beluga and Sterling came online in May 2014. The BCU 7A sidetrack into the Beluga came online in August 2014. The BCU 12A sidetrack into the Beluga and Sterling came online in September 2014.
Vertical expansion approved
To accommodate this renewed activity, the Alaska Oil and Gas Conservation Commission approved a vertical expansion of the official Beluga pool dimensions in 2014 to include all potentially gas-bearing sands in the pool and an easing of restrictions on well spacing, which Hilcorp said would allow development of isolated areas within the reservoir that are currently being bypassed.
This year, Hilcorp planned no drilling activity at Beaver Creek but described a six-well workover program in its development plan. The program includes work on BCU 25, BCU 12A, BCU 10 and BCU 24 to improve gas production and work on BCU 2 and BCU 3RD to improve well disposal capabilities. The company is also planning a major campaign to upgrade facilities at the unit, similar to a program conducted last year.
Birch Hill revival?
Hilcorp is also working to bring the Birch Hill unit back into production.
ARCO Alaska Inc. discovered the field in the northern end of the Kenai Peninsula in 1965 and produced some 65 million cubic feet that year before suspending production.
Although the field has been shut-in since and Hilcorp conducted no activities in 2014, the company told federal officials it has plans to revive gas production in the near future.
Throughout 2012 and 2013, the company conducted and revised planning and engineering design for a road, gathering line and facilities and also cleared vegetation from the right of way. In late April 2014, representatives from Hilcorp, the U.S. Bureau of Land Management and the U.S. Fish and Wildlife Service visited the Birch Hill pad, which can currently only be accessed by foot along the proposed road corridor.
Following all those activities, Hilcorp is currently planning to build a snow road, move a workover rig and testing equipment to the pad, remove the plug and test the well this coming winter, if market and weather conditions accommodate. If the test proves the field is non-commercial, the company would re-plug and abandon the well. If commercial, Hilcorp would build surface facilities and install a natural gas gathering line.
Sterling less certain
Hilcorp is also “actively evaluating” a workover program at the Sterling unit.
Union Oil Company of California discovered the Sterling unit through exploration efforts from the early 1960s. Production has been slow and sporadic over the decades. At times, intervals and reservoirs and even the entire field have been shut-in for extended stretches.
The unit produces from the “A” Zone, Lower Beluga and Tyonek participating areas while the Upper Beluga participating area is “watered out.” Of five unit wells, three are shut-in and one is suspended, according to Hilcorp. The fifth is an active disposal well.
In a January 2015 technical meeting with federal officials, Hilcorp detailed aspects of “a field study to determine the extent and feasibility of extending field life.” While the company has yet to plan any wells, it might conduct a workover campaign to restore production. In March, the company began permitting a workover of the existing and currently shut-in SU 41-15 RD well to add perforations into the Lower Beluga formation.
This year, the company said it will “evaluate and execute” workover projects as they arise and will conduct repairs and upgrades including potential pad and production facility expansions, upgrades to piping and electrical systems and increased compression.
