Providing coverage of Alaska and northern Canada's oil and gas industry
September 2016

Vol 21, No. 36 Week of September 04, 2016

Alaska Oil and Gas Conservation Commission August summary Prudhoe Bay injections

On Aug. 2, the Alaska Oil and Gas Conservation Commission granted (Area Injection Order No. 3B.002, Area Injection Order No. 3B.003 and Area Injection Order No. 4G.001), three requests from BP Exploration (Alaska) Inc. to continue injecting water into specific Prudhoe Bay unit wells. The company had reported a “potential Inner Annulus repressurization” at the PBU S-41A, PBU X-24A and PBU 09-25 wells, which triggered “diagnostics and monitoring.” The tests convinced the commission that “the well’s condition does not compromise overall well integrity so as to threaten human safety or the environment,” although the commission did impose reporting requirements.

On Aug. 16, the commission rescinded and replaced (Area Injection Order No. 3B.004) Area Injection Order No. 3.026, which allowed water injections at the PBU W-42 well.

BP asked for permission in November 2015 to conduct a mechanical integrity test on the well at a pressure of 1,400 pounds per square inch. Shortly thereafter, though, the company decided that advanced corrosion made the well inoperable, which negated its initial request. After resolving some issues with surface equipment, BP resumed water injection and conducted the test at 1,400 psi in July 2016, according to the commission.

The original area injection order in 2009 required that any testing of the well occur at the maximum rate of pressure expected during actual injections, which would have been approximately 1,200 psi. But the existing regulations require any mechanical integrity test to be 1500 psi. The rescinded and replaced area injection order addresses the contradiction by requiring all future pressures tests to meet the regulatory standard.

Additionally, the commission found that “the well’s deteriorating condition represents concern for continued injection” and “encouraged” BP to repair the well’s tubing.

The current approval will expire at the end of 2018, or sooner “if pressure monitoring, tests or surveys show further deterioration of the well’s mechanical integrity.”

BlueCrest advancing Hansen

On Aug. 11, the commission granted (Conservation Order No. 728) a request from BlueCrest Alaska Operating LLC for a spacing exemption for the Hansen H-16 well.

The proposed oil well would be within 1,000 feet of an existing well, in the same governmental section, capable of producing from the same pool. The Hansen H-16 well would be a horizontal development well targeting the Hansen Undefined Oil Pool.

“The well path and bottom-hole location for Hansen H-16 were chosen - based on reservoir mapping and modeling results - to ensure greater ultimate recovery by maximizing the amount of wellbore open to the reservoirs, and extracting oil that cannot be efficiently produced by existing wells,” the commission wrote in its decision.

Although the commission received two public comments on the application, and a request for a public hearing, no one attended the hearing and therefore the commission made its decision based upon the information contained within the original application.

Middle Ground Shoal changes

As initially reported in the Aug. 28 issue of Petroleum News, Hilcorp Alaska LLC proposed a series of changes to Conservation Order No. 44, governing operations for oil and gas production at the offshore Middle Ground Shoal field in the Cook Inlet basin.

The proposed changes come as the company is asking state officials to expand the field to include the North Middle Ground Shoal field and the South Middle Ground Shoal unit.

The commission tentatively scheduled a public hearing on the request for Sept. 20.


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