Producers magazine preview: AIX Energy faces declining production
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Kenai Loop field showing signs of maturity as in 13th year of production; company's focus on aligning gas sales with deliverability
Eric Lidji for Petroleum News
As it begins its second decade in Alaska, AIX Energy LLC continues to be a quiet and reliable presence in the Cook Inlet Basin as operator of the Kenai Loop field.
Its 11th plan of development for the onshore field consists of a single sentence. "AIX will focus on aligning gas sales with field deliverability," wrote Chief Operating Officer Ronald C. Nutt. In a slightly more expansive description of the activities for its 10th plan of development, Nutt wrote that the company had "focused on obtaining reservoir information to better understand field reserves and deliverability, identifying operational efficiencies, maximizing gas sales, and maintaining a safe operating environment."
The note about "field reserves and deliverability" points to the inevitable changes underway at the maturing natural gas field. Kenai Loop produced 1.24 billion cubic feet in 2022, 736 million cubic feet in 2023, 725 million cubic feet in 2024, and 311 million cubic feet through the first half of 2025.
The large drop between 2022 and 2023 can be traced directly to the Kenai Loop 1-3 well, which scaled back production in December 2022 and was suspended in October 2023.
Since then, the Kenai Loop field has been producing from a single well: Kenai Loop 1-1.
This well is also showing signs of age. It produced 2.44 million cubic feet per day in 2022. Production dropped to around 1.98 million cubic feet per day in 2023 and remained flat through 2024. It is down to around 1.71 million cubic feet per day through the first half of 2025.
Kenai Loop came online in 2012. Production began declining in 2016 and accelerated around 2018. AIX Energy installed a new compression facility at the field in 2019, which appears to be the largest investment AIX Energy has made in its time as operator.
Through the end of June 2025, the Kenai Loop field had produced 28.4 bcf, according to the Alaska Oil and Gas Conservation Commission. A Ralph E. Davis Associates Inc. report from the early 2010s estimated the field contained some 31.5 Bcf of natural gas.
History AIX Energy arrived in Alaska in early 2014 when it acquired Australian independent Buccaneer Energy's debt. In a subsequent bankruptcy auction later that year, AIX acquired nearly all of the Buccaneer Energy assets in Alaska through a credit bid.
The acquisition made AIX Energy the operator of the Kenai Loop field.
In its first year as operator, AIX Energy resolved some outstanding issues from its predecessor and began evaluating some of the maintenance projects it could pursue. It also began working to establish various gas sales agreements throughout the basin.
By early May 2017, AIX Energy had at least four supply contracts: a non-firm contract with Tesoro, a non-firm contract with an un-named company (likely Chugach Electric Association), a firm contract with Tesoro and a firm contract with Enstar Natural Gas Co.
By that fall, AIX Energy had renewed its sales agreement with Enstar Natural Gas Co. through March 2021, calling for firm gas supplies that would increase slightly each year. In an early 2022 filing, AIX Energy revealed it was selling its gas volumes exclusively to a single, unnamed purchaser under a one-year "Firm as Available" contract.
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