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KLU gas output climbs Operator Furie is gradually bringing Kitchen Lights production back online Kay Cashman Petroleum News
The Spartan 151 jack-up rig cantilevered over the Julius R. platform in the Kitchen Lights gas field in Cook Furie Operating Alaska’s natural gas production from the offshore Kitchen Lights unit continues to increase, per the Alaska Oil and Gas Conservation Commission. Natural gas output from the Cook Inlet field in April was 347,919 thousand cubic feet as compared to 68,651 mcf in March.
That compares to 853,410 mcf as of November 2018, prior to the field going down because of hydrate plugs.
In April, two wells were online in the 83,394-acre unit, compared to one well in March and four in November and December.
AOGCC reported that for April, well KLU 3 produced 238,316 mcf as compared to 68,651 mcf in March, 1,886 mcf in February, 290,425 mcf in December and 290,279 mcf in June 2018.
KLU A-2A has come back online and for 27 days produced 109,603 mcf in April, as compared to 34,554 mcf in January and 211,732 mcf in December.
Operator Furie had been making steady progress in the field, having completed its planned 2018 drilling program and thus curing a 2017 default with the Alaska Department of Natural Resources’ Division of Oil and Gas, along with securing approval in December of its new plan of development for the Kitchen Lights unit.
But the company ran into problems in January with hydrate plugs caused by freezing water combining with gas to form solid hydrates at the unit’s onshore processing facility and in the 15-mile subsea pipeline from the Julius R offshore production platform, which eventually slowed natural gas delivery to a trickle later that month. Gas output fell to a mere 1,886 mcf in February, putting the company’s supply contract with Enstar Natural Gas Co. in jeopardy.
On Jan. 23 Furie sent a letter to Enstar affiliate Alaska Pipeline Co., declaring Force Majeure and saying that it could no longer meet its commitments under its gas supply agreement with Enstar.
At that time Lindsay Hobson, Enstar communications manager, told Petroleum News the utility had not received any gas from Furie since Jan. 25.
Negotiations continue On Feb. 11, APC sent a formal notice to Furie, declaring that Furie was in default under the supply agreement, triggering negotiations between Enstar and Furie.
Then in a March 19 email Furie’s top executive for Alaska, Scott Pinsonnault, told Petroleum News, “We have safely restored utility and communication between our onshore natural gas processing plant and the Julius platform.” He said the company would spend the next few weeks making sure that the line was completely clear, functional and safe before restoring gas production from the field.
Hobson confirmed May 22 that although Enstar was not currently receiving “firm volumes” from Furie, the contract with the Kitchen Lights operator remained in effect.
“The parties,” she said, “are still in discussions regarding the future of the contract.”
2019 planned activity The division’s approval of the sixth plan of development for Kitchen Lights in December required Furie this year to acquire the logs and data necessary to evaluate the possibility of drilling a fifth development well from the platform, and to present a plan for that well to the division. Depending on the results of data interpretations, the additional well would likely target the stratigraphic equivalents of Sterling formation zones flow tested in KLU 3.
The company also committed to conduct development operations, including the adding of new perforations, in KLU A-2A and KLU 3.
Per the approval document, Furie told the state it would also like to drill additional exploration wells at Kitchen Lights but to do so would require additional financing and the payment of state tax credits that Furie was owed. In that March 1 application Furie said, “in light of the additional reservoir information obtained, Furie proposes separate PAs for the Sterling and Beluga formations, based on substantially different pay area boundaries in each formation.”
By February 2019 the company planned to mature two prospects outside the Corsair block of the unit, and to present the results to the division, together with evidence that reasonable efforts were underway to drill these wells in 2019 or 2020. (The unit is divided into four blocks, all offshore in the Cook Inlet, with development drilling for the Kitchen Lights field taking place in the Corsair block.)
Furie also committed to submit by March 1 a proposal for the establishment of a participating area or areas in the unit.
Per the division, Furie applied for two participating areas - the Corsair Sterling PA and the Corsair Beluga PA.
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