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AOGCC confirms $30,000 Hilcorp fine
Kristen Nelson Petroleum News
In March the Alaska Oil and Gas Conservation proposed fining Hilcorp Alaska $30,000 for failure to submit required meter performance reports for the Beaver Creek unit.
The commission confirmed the fine in a May 14 order. It said Hilcorp has not disputed either the findings in the March notice or the penalty, and since receiving the notice in March, “Hilcorp has provided results of each meter prove as required in the conditional approval letter.”
In addition to the fine, the notice proposed specific correction actions.
Hilcorp did request an informal review, which was held telephonically, the commission said.
Violations The commission said Hilcorp violated requirements of an October conditional approval letter for new custody transfer oil measurement equipment at the company’s Beaver Creek unit by failing to provide meter performance reports as required. In addition to the fine, the commission also required Hilcorp to describe how it would prevent recurrence of the violation.
“Hilcorp’s lack of good faith in its attempts to comply with the imposed conditions, its history of regulatory noncompliance and need to deter similar behavior are factors which most heavily influence AOGCC’s decision and the penalty being assessed,” the commission said in its May decision.
The commission said that while Hilcorp’s compliance has improved over the past two years, “the recurrence of failing to account for approval conditions imposed by AOGCC calls into question the effectiveness of corrective actions implemented in responses to past enforcement actions.”
The commission said it had closed out an enforcement action for similar violations at the Granite Point and Trading Bay units, “with the same assurances of corrective actions just four months prior to this violation at Beaver Creek.”
In addition to the civil penalty of $30,000, which must be paid within 30 days if Hilcorp chooses not to appeal the order, within 10 days “Hilcorp shall provide a detailed written explanation that describes how it intends to prevent recurrence of this violation,” the commission said in its order.
- KRISTEN NELSON
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