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Furie requests reconsideration of AOGCC order on old inlet wells
Kristen Nelson Petroleum News
Furie Operating Alaska has filed a motion for reconsideration of the Alaska Oil and Gas Conservation Commission’s March 1 order denying the company’s request that no further site clearance work be required on three Cook Inlet wells drilled by the company under previous owners.
The commission agreed with Furie’s request to change the status of the three wells at the offshore Kitchen Lights unit - KLU 1, KLU 2A and KLU 4 - from suspended to plugged and abandoned.
Furie had also requested that the commission not require further site clearance work. When the wells were drilled, they were left with casing rising 15 feet above the seafloor, based on stated intent of the previous unit owner to re-enter the wells.
The commission also required Furie to provide well location information to the National Oceanic and Atmospheric Administration for inclusion in its Cook Inlet navigation chart.
In the company’s March 3 request for reconsideration, Furie CEO and President John Hendrix said that on March 2 Furie provided “well location coordinates and casing height information” to NOAA for inclusion on the Cook Inlet navigation chart and said Furie would provide confirmation to AOGCC “that the information has been included in the NOAA database.”
Site clearance The company is requesting reconsideration on the site clearance issue, asking “for the appropriate weighting of risk, health and safety against leaving the three wells with structural casings 15 feet above the seafloor.”
Hendrix said Furie agreed with comments from the Department of Natural Resources’ Division of Oil and Gas, which supported the company’s request to grant site clearance with the well casings 15 feet above the seabed floor.
“DNR, representing the State of Alaska as both the landowner and lessor of the mineral estate, carefully evaluated the risk to human safety versus the real impact of removing the casing stubs,” Hendrix said.
Furie disagreed with comments from the Cook Inlet Regional Citizens Advisory Council and Cook Inletkeeper, which opposed leaving the stubs in place, citing concerns over navigational risks for marine vessels, the presence of large boulders in the vicinity, extreme tidal fluctuations, high currents and setting a precedent in Alaska for wells drilled from mobile offshore drilling units.
55-year record In disagreeing with the commission’s requirement that the stubs be removed, Furie referred to older wells which were drilled in the 1960s and had site clearance requirements waived - prior to enactment of current site clearance regulations.
Hendrix said the wells had similar configurations to the three Kitchen Lights unit wells at issue and, he said, for more than 55 years the wells “have posed no threat to navigation for marine vessels or have been influenced or damaged due to boulders, high currents, and extreme tidal fluctuations” - concerns cited by CIRCAC and Cook Inletkeeper.
“Furie is not willing to unnecessarily place human life at risk due to a technicality in regulation with on environmental impact,” Hendrix said, adding that Furie agrees with DNR that this exception to the regulation “would not be precedent setting,” calling it, instead, “just a sound management decision.”
Safety issue Hendrix discussed the safety issue of sending divers down to do the site clearance work and said Furie’s motion for reconsideration “is based on the request for the appropriate weighting of risk, health, and safety against leaving the three wells with structural casings 15 feet above the seafloor.”
“Placing people in one of the most hazardous environments without reasonable cause is not warranted. The conclusion by DNR, the SOA’s resource owner are prudent and responsible. Furie should be allowed to leave the three wells with structural casing 15 feet above the seafloor and not place regulation ahead of human safety,” he said.
In the December hearing Furie presented three cost estimates for cutting the casing: the most expensive, at almost $7 million, required mobilizing a jack-up rig; the other two options, at almost $4 million and just more than $2 million, required a barge and divers, with the price difference in whether the casing was cut at the mudline or 5 feet below the mudline.
Commission’s decision The commission said in its order that it would grant or refuse a reconsideration application in whole or part within 10 days and said failure to act within 10 days would constitute denial. A decision may be appealed to superior court.
In its March 1 order (see story in the March 7 issue of Petroleum News), the commission granted Furie’s request to change the status of the wells to plugged and abandoned, but denied the waiver for site clearance, and said until site clearance is granted - which would require the casing stubs to be removed - the wells will be included on the list of Furie wells which require bonding.
In its conclusions the commission noted the six wells which were granted site clearance in the 1960s received that clearance “before the current offshore site clearance regulation was enacted.”
The commission did not address the safety issue raised by Furie, but focused on the issue of setting a precedent:
“Granting site clearance for Furie’s wells in their current condition, wells which were abandoned after the site clearance regulations were enacted in 1986, could set a precedent for future site clearances in the Cook Inlet and in all Alaskan waters,” the commission said.
- KRISTEN NELSON
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