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Preliminary draft out for Julius R discharges, includes produced water
Kristen Nelson Petroleum News
In its 2020 plan of development for the Kitchen Lights unit HEX, the new owner of Furie Operating Alaska, said the company has been producing only from the Beluga formation on the Julius R platform in Cook Inlet since a hydrate plug forced shutdown of production in early 2019.
HEX Cook Inlet acquired Furie Operating Alaska out of Chapter 11 bankruptcy on July 1.
In the seventh plan of development for Kitchen Lights, submitted to the Alaska Department of Natural Resources’ Division of Oil and Gas in September, HEX said Kitchen Lights production was restored in April 2019 but among the measures implemented to avoid future hydrate plugs - including periodic pigging, methanol injection and installation of additional heat trace at the central processing facility - production was limited to the Beluga formation “to limit the amount of produced water entering the pipeline.”
“With the Beluga reservoir in decline the upside prize for the new owners was returning the Sterling reservoir to production,” requiring “a water handline permit for overboard discharge of the water,” HEX said in the POD.
The company said it had assumed Sterling would be online in the fourth quarter of 2020, but now that production isn’t expected to come online until the second quarter of 2021 at the earliest.
The company said all four of the wells on the Julius R platform have been perforated in both the Sterling and the Beluga.
“Obtaining the platform water handling permit more than doubles our remaining reserves and revenue,” HEX said.
Preliminary draft out The Alaska Department of Environmental Conservations’ Wastewater Discharge Authorization Program issued a notice of review Nov. 19, with a preliminary draft available for a two-day review by the applicant, ending Nov. 23, following which DEC will prepare a draft permit and fact sheet for a formal 30-day public review period.
The notice of review says the proposed permit is for reissuance of the initial wastewater discharge permit issued in 2014 for construction of the Julius R platform and pipeline, as amended.
Furie initiated natural gas production from the Julius R in late 2015 from a single well; today there are four wells completed into the Beluga and Sterling formations.
DEC said, “the addition of a system to treat produced water prior to its discharge to Cook Inlet from the platform represents a major modification to infrastructure affecting the proposed permit.”
Furie Operating applied for reissuance of its Alaska Pollutant Discharge Elimination System individual permit for the Julius R platform in March 2019 and submitted an amendment in November 2019 to include an additional, new discharge of produced water.
Beluga DEC said the 2014 permit was based on production from the Beluga formation with the assumption that produced water would be minimal, some 50 barrels per day, and that it could be transported via pipeline to the onshore central production facility for disposal.
“However, after completing wells and producing from the Sterling formation, the volume of produced water has significantly increased and includes gas hydrates that can cause pipeline freeze-ups that must now be considered,” the department said.
DEC said the original assumptions, based on dry gas from the Beluga formation, were “found to be inappropriate,” as Sterling gas is wet with produced water volumes of some 2,000 bpd.
“Further compounding produced water management difficulties, during the winter conditions of January 2019 while producing from the Sterling, gas hydrates formed in the produced fluids within the pipeline to the onshore facility causing a pipeline blockage substantial enough to completely halt gas production for 75 days,” DEC said.
Sterling To ensure that gas hydrates do not form in the pipeline, water needs to be removed at the platform.
“This situation posed a design challenge to find a produced water treatment system that could adequately treat the produced water and be installed within the limited space available at the platform,” DEC said.
Furie submitted a preliminary application, without produced water, in February 2019, prior to expiration of the existing permit, and DEC said it administratively extended the 2014 permit “until Furie could conduct a pilot test for a produced water treatment system and submit a supplemental application allowing for permit reissuance.”
The supplemental application was submitted in November 2019 with information based on successful completion of a pilot test.
DEC requires engineering plans for such a non-domestic wastewater treatment system and said Furie submitted those plans and they were approved in February 2020 but, the department said, Furie is waiting until the permit becomes effective to start construction.
- KRISTEN NELSON
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