Providing coverage of Alaska and northern Canada's oil and gas industry
August 2022

Vol. 27, No.32 Week of August 07, 2022

RCA issues order transferring North Fork pipeline to Gardes

Kay Cashman

Petroleum News

Effective July 27, the Regulatory Commission of Alaska issued a final order transferring Cook Inlet Energy’s controlling interest in Anchor Point Energy, owner of the North Fork unit pipeline, to Gardes Holdings, which essentially owns the North Fork unit leases and assets via Vision Resources and Vision Operating.

Cook Inlet Energy is a Glacier Oil and Gas company. On May 1, 2021, Vision Operating took over as operator of the 2,602-acre North Fork unit, which consists of five state leases on the southern Kenai Peninsula.

Unlike every other hydrocarbon producer that has entered Alaska, Lafayette, Louisiana-based Robert “Bob” Gardes is first and foremost looking for natural gas, not oil.

RCA’s transfer approval is contingent on the following:

*By Aug. 26, Gardes Holdings must file an original, paper copy of its corporate guaranty as a “compliance filing in this docket.”

*Anchor Point Energy has to attach proof of insurance meeting the requirements of the order to each annual report.

*By Aug. 26, Gardes Holdings must file tariff revisions on behalf of Anchor Point Energy as a compliance filing.

The transfer application was jointly filed on April 1, 2021, by Cook Inlet Energy and Gardes Holdings and supplemented May 14, 2021, July 23, 2021, Sept. 8, 2021, Jan. 13, 2022, March 25, and July 11.

Production stable

The most recent Alaska Oil and Gas Conservation Commission data for June shows the North Fork unit averaged 3,058 thousand cubic feet per day, down 22 mcf per day from a May average of 3,080 mcf per day, and up 1% from a June 2021 average of 3,028 mcf per day.

In late January the Alaska Department of Natural Resources issued the Acknowledgement of Transfer of Interest of Right-of-Way Lease for the North Fork pipeline, ADL 230928.

The joint applicants provided a copy of the right-of-way lease to RCA for the pipeline and supplemented the application with documentation that resolves any issues related to the interests of Apollo Investment Corp. and Highbridge Principal Strategies in the right-of-way lease, RCA noted in its recent order.

DNR also approved the transfer of controlling interest in Anchor Point Energy from Cook Inlet Energy to Gardes Holdings.

Few changes, more gas

In its filings with RCA, Gardes Holdings said that it does not intend to change the manner in which the North Fork Pipeline is operated by Anchor Point Energy and that Anchor Point Energy will continue to operate the North Fork pipeline as a regulated common carrier pipeline, accessible to all shippers on nondiscriminatory terms and conditions and in accordance with applicable safety and environmental practices, statutes, and regulations.

Gardes Holdings said that approval of the transfer of controlling interest in Anchor Point Energy will have no substantive effect on Anchor Point Energy’s rates or terms and conditions of service and that no substantive changes will be required to Anchor Point Energy’s tariff.

In conclusion, Gardes Holdings said that its “investments, including the acquisition of Anchor Point Energy, will have the potential to benefit gas consumers and to benefit the greater economy of Southcentral Alaska by developing and delivering additional energy resources, creating jobs, and stimulating economic activity.”

By delivering additional energy resources, Gardes Holdings was likely referring to its plan to increase natural gas production from North Fork.

To increase gas production Vision Operating has to be able to deal with water produced along with natural gas. In April the company got AOGCC approval to use an existing, but non-producing well, for Class II oil field waste fluids underground disposal (see story titled “Vision Operating gets AOGCC OK for North Fork aquifer exemption” in July 31, 2022, issue of Petroleum News).

As many as 23 prospects

Stephen Hennigan, president of Vision Operating, told AOGCC in a February hearing that the company has identified as many as 23 prospects in the area.

He said he had been involved at North Fork since Armstrong Cook Inlet brought the field online and said a lot of zones were left because they started to produce water. There was significant gas in those zones, he said, and if the water could be disposed of, the company could go back and produce the gas.

The North Fork discovery well was drilled in 1965 by Standard Oil Company of California, but the field was not brought online until 2011, after Armstrong Cook Inlet, a subsidiary of Armstrong Oil and Gas, took over the field in in 2007, drilled new wells, built a 7.4-mile pipeline and began delivering gas.


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