Alaska Oil and Gas Conservation Commission report: March 2017

•The Alaska Oil and Gas Conservation Commission on March 3 reduced (Other Order 116) the amount of a fine that it had previously charged against Hilcorp Alaska LLC for regulatory violations at the Milne Point unit, as reported in the March 12 issue of Petroleum News. The eventual $200,000 came down from an earlier total of $720,000.

On March 22, the AOGCC issued (Other Order 117 and Other Order 118) two $80,000 fines against Hilcorp Alaska LLC for activities at the Milne Point unit, as reported in the March 26 issue of Petroleum News. The final amounts of both were increased from preliminary fines of $75,000. The commission fined the company for changing approved work procedures and performing well cleanouts without an approved contingency plan.

•On March 7, the AOGCC approved (Area Injection Order No. 2C.043) a request from ConocoPhillips Alaska Inc. to continue water injections at the Kuparuk River Unit No. 1B-04 well. The company reported a tubing by inner annulus pressure communication in October 2016 while injecting natural gas. The communication was not observed during a 30-day water-alternating-gas test, and subsequent mechanical integrity testing in January 2017 convinced the commission of the integrity of the well for water injections.

•On March 10, the AOGCC approved (Conservation Order 341F.004) a request from BP Exploration Alaska Inc. to waive Rule 7(a) in Conservation Order 341F for the Prudhoe Bay Unit 07-15B sidetrack at the Prudhoe Bay unit. The rule required “an open- or cased-hole neutron log to be run, in certain portions of the pool, on newly drilled wells prior to sustained production for the purpose of gas-oil contact.” A slickline neutron tool was unable to reach the gas-oil contact in the sidetrack, but neutron logs recorded from several nearby wells provided enough information to satisfy the needs of the commission.

•On March 15, the AOGCC approved (CO 730) a request from BlueCrest Alaska Operating LLC to drill and complete the Hansen H-14 oil well and also approved (CO 729) a request from BlueCrest to drill the Hansen H-14L1 lateral within the same section of a previously producing well. The proposed well and lateral would be in the same section as the existing Hansen 1A-L1 lateral and the Hansen H-16 well at the Cosmopolitan unit in the southern Kenai Peninsula near Anchor Point.

The two conservation orders exempted the company from the spacing requirements for development drilling, which were unnecessary given that BlueCrest is the sole lessee.

The commission also approved drilling permits for both wells on March 17.

•The AOGCC has scheduled a public hearing (CO-17-009) on April 18 to consider a request from BP Exploration (Alaska) Inc. for permission to repair production casing leaks and tubing leaks in the PBU G-11B producer, PBU 15-48C producer and PBU Y-24 injector at the Prudhoe Bay unit remedial inner annulus cement squeeze procedures.

•The AOGCC has scheduled three public hearings (CO-17-006, CO-17-007 and CO-17-008) on April 20 to consider a proposal to waive certain requirements for workovers at the fields of the Prudhoe Bay unit, the Kuparuk River unit and the Colville River unit.

- ERIC LIDJI