AOGCC fines Eni for late reports

The Alaska Oil and Gas Conservation Commission has fined Eni US Operating Co. Inc. $20,000 for “repeatedly failing to submit” required annual surveillance reports for the Nikaitchuq Schrader Bluff Oil Pool in the Nikaitchuq unit by the deadline specified in rule 12 of Conservation Order 639.

In a May 5 order the commission said it issued a notice of proposed enforcement action to Eni last December based on the company’s “repeated failure” to submit annual reservoir surveillance reports by a required April 1 deadline. The commission said this covers reports from 2013 through 2016.

Eni requested an informal review, which was held in July. The commission said it gave Eni time to submit additional information, which was submitted.

The fine as originally proposed was $20,000.

When Eni requested the informal review it told the commission it would provide assurance that the late report submittal would not occur again and asked that the commission not penalize the company.

The commission said that during the informal review Eni took responsibility for the reports being submitted late and said it would not happen again. The commission said the issue of late reports had been raised with Eni in May of 2015 and Eni “provided the same assurances that the reports would be submitted on time.” Eni told the commission last year that it instituted “a robust process” to ensure reports are timely fined.

The company provided information on the new process, “a formal process involving multiple steps and people within Eni designed to ensure that the annual reservoir surveillance report is completed and submitted on time.”

The commission said there was nothing ambiguous about the language requiring annual report submittal, and said Eni had a history of noncompliance, even after AOGCC staff brought the repeated violations to the company’s attention, and said the company’s “failure to follow through on its prior assurance that it would meet the deadline going forward, and the need to deter similar behavior are the factors which most heavily influence this decision,” with was imposition of the $20,000 civil penalty as originally proposed.

- KRISTEN NELSON