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State approves MGS operations suspension
Kristen Nelson Petroleum News
The Alaska Division of Oil and Gas has approved a June request from Hilcorp Alaska for suspension of operations and production at the Middle Ground Shoal unit in Cook Inlet.
Hilcorp shut down MGS in April, following discovery of a fuel gas leak and has been required by the federal Pipeline and Hazardous Materials Safety Administration to replace the line between Platform A and shore. In an April 6 amended corrective action order, the agency said the MGS-A line must remain shut-in and may not be operated until authorized by the PHMSA director.
PHMSA said this is the fifth leak on the MGS-A line since June 2014. Previous leaks occurred in June and August of 2014, December 2016 through May 2017 and in 2019.
Hilcorp purchased MGS Cook Inlet oil and gas facilities from XTO Energy in September 2015. MGS-A pipeline, an 8-inch diameter line from MGS onshore facility to Platform A, was installed in 1965; the portion from the A Platform to the C Platform was installed in 1967.
MGS Platform A was the first Cook Inlet platform installed, put in place by Shell in 1964. XTO, formerly Cross Timbers, purchased Shell’s Cook Inlet interests, including Platforms A and C, in 1998.
Request in June Hilcorp requested suspension of production and operation for MGS June 22, telling the division the suspension would be until the fuel gas system is evaluated, repaired and returned to operational status.
In a July 28 decision division Director Tom Stokes said Middle Ground Shoal, discovered by Amoco Production Co. in 1963 at the MGS State No. 1, “was the first offshore discovery in both Alaska and the Cook Inlet.”
The MGS unit was formed in 1967 as the South Middle Ground Shoal unit and renamed MGS in 2016 when the division approved an extension of the unit to include leases Hilcorp acquired from XTO Energy.
Stokes said there are four platforms in MGS. Two are lighthoused, Baker since 2013 and Dillon since 2003, with all MGS production, prior to the April shut-in, from the A and C platforms. As of May 31, MGS has cumulatively produced 210.21 million barrels of oil and 114.73 billion cubic feet of natural gas, he said.
Hilcorp told the division the fuel line “is capped and filled with sea water, and resting on the sea floor.” The company said all platforms in MGS “will remain shut in while Hilcorp determines the best path to reactivation through pipeline repair or replacement.”
The company said if replacement is chosen, it estimates operations would extend into late-2022.
In a June 1 decision the division required Hilcorp to provide updates of the status MGS every 60 days. Stokes said the only additional modification “is to limit the approved SOP period to 18 months.” If the company requires an extension, it must notify the division in writing no later than 45 days from expiration of the approved SOP period, which is June 22, 2021, through Dec. 21, 2022.
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