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Hilcorp drops Swanson comingle request Commission hears testimony on definition of three natural gas pools based on field’s BLM-managed natural gas participating areas Kristen Nelson Petroleum News
The Alaska Oil and Gas Conservation Commission heard testimony from Hilcorp Alaska LLC Jan. 15 on the company’s request for changes in gas pool rules for the Swanson River field.
The company applied for definition of three Swanson River gas pools; unrestricted gas well spacing for wells at least 1,500 feet from the field’s external boundary; and commingling of gas production within the wellbore from any defined gas pool.
David Duffy, Hilcorp Alaska landman, said participating areas at Swanson River are managed by the U.S. Bureau of Land Management on behalf of itself and Cook Inlet Region Inc., the royalty owners. When Hilcorp shared the application for pool rule changes with BLM, he said, the agency was concerned about commingling, so Hilcorp dropped it. Swanson River is in the Kenai Peninsula’s Kenai National Wildlife Refuge in Southcentral Alaska.
Hilcorp reservoir engineer Jason Ewing told the commission that commingling wasn’t a deal breaker, so Hilcorp removed it from the application.
Goal to increase production In its application Hilcorp said its goal was to increase production from legacy Cook Inlet assets it acquired from Union Oil Company of California and Marathon Oil.
The company said that when a unit operating agreement was signed in 1963 Swanson River had four working interest owners and the agreement consolidated Swanson River and Soldotna Creek into a single operating area for pressure maintenance and increased recovery.
Hilcorp now holds a 100 percent working interest ownership at Swanson. Since 1963 oil and gas production has been allocated “under a complex formula” BLM uses to review and approve allocations to participating area.
Duffy told the commission established participating areas are administered by BLM and the goal of the company’s request for changes is to establish pool rules that match the participating areas.
30 sands Ewing reviewed production in the Jan. 15 presentation, telling the commission Swanson River produced 55 billion standard cubic feet from 17 shallow gas wells- excluding gas storage - from 1960 to 2014.
Of those volumes 27.1 bcf came from the Sterling; 9.3 bcf from Beluga; and 18.9 bcf from Tyonek, with 47 completions out of 30 different sands, 20 Sterling completions, 11 Beluga completions and 16 Tyonek completions.
Ewing said production peaked at 23 million cubic feet per day in 2004. The 17 producing wells, he said, are widely spread in the field. A map Hilcorp included in its presentation showed nine wells near the northern end of the field, five in the middle and four toward the southern end.
Pool definition requests Hilcorp had requested a definition of the Sterling/Upper Beluga gas pool including all intervals correlating with the interval from 2,140 feet true vertical depth to 4,490 feet tvd in the SCU 41-4 well.
In its Jan. 15 presentation, however, Hilcorp described this as intervals from 389 feet tvd to 4,490 feet tvd.
Asked by Commission Chair Cathy Foerster about the 389 foot top in the presentation, Ewing said the change was made in case additional gas was found at shallower depths.
In response to a further question, Ewing said the shallowest gas Hilcorp knows about is roughly 2,600 to 2,800 feet TVD.
Duffy acknowledged that the Jan. 15 presentation materials did present a shallower depth than the application.
Commissioner David Mayberry also asked about depths at which drinking water would occur.
Foerster said it was bad form for the application to differ from the presentation materials and said the record would be held open for a corrected depth for the Sterling/Upper Beluga.
The Beluga gas pool would include all intervals correlating with the interval 4,490 feet tvd to 5,120 feet tvd in the SCU 41-4 well and the Tyonek gas pool would include all intervals correlating with the 5,120 feet tvd to 10,085 foot tvd interval in the SCU 41-4 wells.
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