AOGCC cancels hearing

Cancellation due to petitioner Dan Donkel’s failure to notify owners he wants lease included in ConocoPhillips’ Kuparuk

Kristen Nelson

Petroleum News Editor-in-Chief

The Alaska Oil and Gas Conservation Commission has canceled a May 15 hearing on the petition of Dan Donkel to unitize leases ADL 380066 and 28249 or, in the alternative, to expand the Kuparuk unit to include lease ADL 380066.

Donkel petitioned the commission in January for compulsory unitization of North Slope oil and gas lease ADL 380066 with lease ADL 28249 or the compulsory expansion of the Kuparuk unit. Donkel had an overriding royalty interest in oil and gas lease ADL 380066, now expired, which is adjacent to the Hemi Springs well south of Kuparuk. The state certified the Hemi Springs well in the early 1980s as capable of producing in paying quantities.

In February, the commission told Donkel that, according to Alaska statute, he was required to provide notification of the petition by certified mail to each owner of an interest in the affected tracts.

Donkel argued, and continues to argue, that it is the commission’s duty to provide notification.

In March, the commission set the hearing date and informed Donkel that he would have to provide it with proof of notification by certified mail to owners of interests in the affected tracts by April 17.

The agency said that if it was forced to cancel the hearing due to Donkel's failure to provide proof of notification, it would consider allocating to him the cost of the newspaper notice, as provided by statute.

The commission said that Donkel notified them on April 17 and 18 that it is his position that he does not have “the duty to notice anyone of petition.” The agency said Donkel indicated “that he does not intend to comply” with its requirements for notification by certified mail to owners.

Ruling wouldn't be binding without notice

The commission said it would be “wasteful” of its “time and resources, and those of the parties” to proceed with a hearing under these circumstances.

And, since Donkel has not paid any regulatory cost charges and since his failure to comply with the agency's notification requirements has caused the commission “unnecessarily to bear the expense of publishing notice of a hearing that will now be canceled and the expense of publishing notice of cancellation of the hearing,” the commission is charging Donkel $102.93 for publication costs.

Donkel said in his April 18 letter to the commission that it is the duty of the commission to protect royalty owners. He said he does not have the financial resources to do the commission's duty, and said “the law does not require it.” He told the commission that it is their duty to notice hearings.