State approves AEC Oil and Gas (USA) as McCovey operator, update of plan

Petroleum News Alaska Staff

The Alaska Department of Natural Resources Division of Oil and Gas has approved an update to the initial plan for the McCovey unit and a change of operator from Phillips Alaska Inc. to AEC Oil and Gas (USA) Inc.

The division said Dec. 6 that the McCovey unit agreement, approved by the division and the U.S. Department of the Interior’s Minerals Management Service for a two-year term expiring Aug. 31, 2002, has been extended through June 30, 2003, subject to concurrence by MMS. MMS spokeswoman Robin Cacy told PNA Dec. 10 that MMS is reviewing the application.

The McCovey update proposes using the steel drilling caisson, rather than an ice island, to drill the McCovey well. The division said that AEC plans to obtain the necessary permits to use the SDC to drill exploratory wells in the McCovey unit, refurbish the SDC between May 1 and July 15, 2002, and move it to the McCovey unit location by Aug. 10.

The rig would be unoccupied in quiet mode between Sept. 1 and Oct. 15, 2002, to limit affecting the whale migration.

The proposed schedule includes drilling from the SDC during the 2002-2003 winter season.

The division said the McCovey update is approved through June 30, 2003, conditioned upon: beginning of drilling by June 30, 2003; the working interest owners drilling the well from a bottom-founded mobile offshore drilling unit; drilling the well to a depth sufficient to penetrate the Basal Brookian Interval or 13,000 feet subsea, whichever is lesser; termination of the unit if the working interest owners do not meet obligations for the unit.