Danco hearing postponed

Kristen Nelson

The Alaska Oil and Gas Conservation Commission has postponed the continuation of its hearing on the application of Danco Inc. for an order granting integration of interests and unitization of tracts in the existing North Cook Inlet unit with state oil and gas leases ADL 369100 and ADL 369101.

A scheduling hearing April 17 was recessed to April 23 so the parties could discuss access by Danco expert David Lappi to Phillips Alaska Inc. seismic data, so that Lappi could determine if the processed data was what the Danco group needed, or if they would have use raw data and have their own processing done.

Phillips said the raw data could be made available, but said their experts indicated processing would take six to eight months and cost the Danco group $2.5-$3.5 million in additional to data copying charges.

The parties agreed that sufficient information on the processing could be provided without intruding on Phillips’ proprietary processing techniques.

The seismic in question is from 1993, when the former ARCO Alaska Inc.-Phillips Petroleum Co. partnership was primarily interested in the deeper oil zone, but an expert for Phillips said that because of Phillips Petroleum’s gas production from the Tyonek platform, the seismic was processed to image both the deep oil zone and the shallow gas zone.

The parties did not reach resolution on the extent of the seismic. Phillips said what it was making available included only the unit and the two northern leases that are in question, while the Danco group wanted seismic surrounding the unit.