AOGCC approves Swanson gas pools rules

Hilcorp Alaska requested definition of three gas pools late last year; previous order dealt with Hemlock oil pool at Swanson River

Kristen Nelson

Petroleum News

The Alaska Oil and Gas Conservation Commission has issued a new conservation order, No. 716, for natural gas pools at Swanson River in the Kenai National Wildlife Refuge on the Kenai Peninsula in Southcentral Alaska. Operator Hilcorp Alaska requested an amendment to conservation order No. 123B in October to define three new gas pools at Swanson River. The commission held a hearing Jan. 15 (see stories in Nov. 30, 2014, and Jan. 25 issues).

In an April ruling the commission concluded it was more appropriate to issue a new order for development of gas-bearing sands at Swanson rather than amending CO 123B, which was issued to govern development of the Hemlock oil pool at Swanson.

Hilcorp asked for the definition of three new gas pools, the Sterling/Upper Beluga/ the Beluga and the Tyonek, and for rules governing development and operation of the pools.

Hilcorp is the owner of the Swanson River field; the Bureau of Land Management and Cook Inlet Region Inc. are the landowners.

In its application Hilcorp told the commission there are 67 wells in the Swanson River field, 36 of which are producing. During June of 2014 the wells produced 68,882 barrels of oil and 238.787 million cubic feet of natural gas. Peak oil production at the field was 1.457 million barrels of oil in September 1968 and 706.304 million cubic feet of natural gas in October 2004.

When a unit operating agreement was signed in 1963 Swanson River had four working interest owners: Union Oil Company of California, Standard Oil Company of California, Richfield Oil Corp. and Marathon Oil.

Hilcorp now holds a 100 percent working interest at Swanson, as a result of its acquisition of the Cook Inlet assets of Union Oil in 2011 and Marathon in 2012.

The gas pools would be based on intervals correlated with the Soldotna Creek unit 41-4 well: the Sterling/Upper Beluga gas pool from 2,140 feet true vertical depth to 4,490 feet tvd; the Beluga gas pool from 4,490 feet tvd to 5,120 feet tvd; and the Tyonek gas pool from 5,120 feet tvd to 10,085 feet tvd.

The gas is found in the Miocene-to-Pliocene-aged sandstones of the Sterling formation and the Miocene-aged sandstones of the Beluga formation.

“Within the development area, gas has accumulated in several pockets of a north-south trending faulted anticline, which measures about 7 miles long and 4 miles wide and is bounded on the west by a large sealing fault,” the commission said in its order.

The commission said the northern two-thirds of the Swanson River field is also known as the Swanson River unit; the southern third is also known as the Soldotna Creek unit.

Order 716 provides for no restrictions on spacing of development gas wells within the affected area except that no well shall be drilled or completed less than 1,500 feet from the exterior boundary of the area unless owner and landowner are the same on both sides.