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Home My WebLink AboutCO 736CONSERVATION ORDER 736 Docket Number: CO-17-009 Prudhoe Bay Field Prudhoe Bay Oil Pool Pt. McIntyre Oil Pool Stump Island Oil Pool Lisburne Oil Pool Niakuk Oil Pool Aurora Oil Pool Borealis Oil Pool Orion Oil Pool Polaris Oil Pool Midnight Sun Oil Pool North Prudhoe Bay Oil Pool West Beach Oil Pool Raven Oil Pool Put River Oil Pool 1. November 30, 216 BPXA’s request for approval of a proposed 2017 PBU sundry matrix for well work operations 2. March 9, 2017 Notice of hearing, affidavit of publication, email distribution, mailing list 3. April 17, 2017 BPXA written testimony in support of application 4. April 18, 2017 Hearing transcript, hearing sign-in sheet 5. June 27, 2017 Notice of hearing, affidavit of publication, email distribution, mailing list 6. August 15, 2017 Hearing transcript, hearing sign-in sheet, BPXA Presentation 7. October 27, 2017 CONFIDENTIAL History of Production Casing Leaks in PBU (held in secure storage) 8. February 26, 2018 BPXA request for reconsideration 9. --------------------- reports STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Rules for repair of packer leaks, tubing leaks and production casing leaks using inner annulus remedial cement squeezes IT APPEARING THAT: Docket Number: CO -17-009 Conservation Order 736 Prudhoe Bay Field Prudhoe Bay Oil Pool Pt. McIntyre Oil Pool Stump Island Oil Pool Lisburne Oil Pool Niakuk Oil Pool Aurora Oil Pool Borealis Oil Pool Orion Oil Pool Polaris Oil Pool Midnight Sun Oil Pool North Prudhoe Bay Oil Pool West Beach Oil Pool Raven Oil Pool Put River Oil Pool February 9, 2018 1. British Petroleum Exploration Alaska (BPXA), operator of Prudhoe Bay Field (PBF), Prudhoe Oil Pool has submitted Applications for Sundry Approvals for well work to repair tubing leaks and production casing leaks using remedial cement squeezes of the inner annulus (IA) in the following wells: G-1 1B (PTD 2809270) 15-48C(PTD 2110300) Y-24(PTD 1861130) 2. Pursuant to 20 AAC 25.540, the Alaska Oil and Gas Conservation Commission (AOGCC) on its own motion scheduled a public hearing for April 20, 2017. The purpose of the hearing was to receive testimony on IA cement squeezes to repair tubing leaks, production casing leaks and 1 "Inner annulus" means the space in a well between tubing and production casing. Conservation Order 736 February 9, 2018 Page 2 of 5 packer leaks. On March 12, 2017, the AOGCC published notice of the opportunity for that hearing on the State of Alaska's Online Public Notice website, on the AOGCC's website, electronically transmitted the notice to all persons on the AOGCC's email distribution list, and mailed printed copies of the notice to all persons on the AOGCC's mailing distribution list. On March 12, 2017, the AOGCC published the notice in the ALASKA DISPATCH NEWS. 3. Written comments were received from BPXA. 4. The AOGCC held the hearing as noticed. 5. The hearing was continued to August 15, 2017. Additional evidence was taken in the August 15 hearing. FINDINGS: 1. For producing wells capable of unassisted flow, AOGCC regulations require downhole production equipment consisting of suitable tubing and a packer that effectively isolate the tubing -casing annulus from fluids being produced. 2. For injection wells, AOGCC regulations require that in order to confirm continued mechanical integrity, the operator shall monitor the pressure in the casing -tubing annulus. 3. For injection wells, AOGCC regulations require a well to be equipped with tubing and a packer. The packer must be placed within 200 feet measured depth above the top of the perforations. 4. For production wells, Sustained Casing Pressure Rules require the Operator to monitor each development well daily to check for sustained pressure. The Operator must notify the AOGCC of sustained inner annulus pressure that exceeds 2000 psig. 5. BPXA has applied for IA remedial cement squeezes for wells that it believes have no future utility and cannot economically justify a rig workover to repair the leaks. 6. According to BPXA, the objectives of the IA remedial cementing method rules are to conserve Alaska petroleum resources and protect human safety and the environment through proper management of the IA. Proper management aims to mitigate the potential for failure of well integrity and prevent uncontrolled release of fluid or pressure, or threat to human safety. Conservation Order 736 February 9, 2018 Page 3 of 5 CONCLUSIONS: 1. Annular casing pressure management techniques are used to maintain well control and prevent or mitigate unintended flow from development and injection wells. Those techniques rely on gathering surface pressure measurements to assess overall well integrity and properly design mitigations. Remedial cement squeezes in the IA of a well place cement in an attempt to isolate zones within the well that have identified loss of mechanincal integrity. 2. IA cement squeezes may increase resource recovery in wells that have no future utility. IA cement squeezes may increase resource recovery from the pool by either returning a shut- in producer to production and thus capturing additional reserves near the well that would otherwise be lost, or by returning a shut in injector to service to provide injection support to offset producers and thus increase the ultimate recovery in those adjacent wells. 3. IA remedial cement squeezes reduce or compromise the ability to use annular casing pressure management to assess overall well integrity, maintain well control and prevent or mitigate unintended subsurface flow. IA remedial cement squeezes may prevent typical methods of diagnostic testing as described in API Recommended Practice 90-2, Annular Casing Pressure Management for Onshore Wells. 4. Without a depth limit, an IA remedial cement squeeze could eliminate the ability to monitor annular pressure at surface, and eliminate the number of independently monitored barriers used to ensure well integrity. 5. IA remedial cement squeezes may mask tubing leaks, casing leaks, cement channeling and other breaches in mechanical integrity. 6. IA remedial cement squeezes limit other methods of corrective action including future workover methods for repairing packer leaks, tubing leaks and production casing leaks. 7. IA cement squeeze procedures require the Application for Sundry Approval(IO-403). The Sundry Application process is the appropriate process for remedial cementing of the IA. IA remedial cement may require waivers from AOGCC regulations. Conservation Order 736 February 9, 2018 Page 4 of 5 NOW, THEREFORE IT IS ORDERED THAT: Rule 1 Remedial IA cement squeeze methods require an Application for Sundry Approval (10-403). The Sundry Application must include: a. A reserves analysis demonstrating that a rig workover is not economically justifiable. b. Cretaceous stratigraphy for the well. c. A detailed well history including the type and depth of leaks in the IA and diagnostics performed and the integrity of the outer annulus. d. IA cement squeeze procedure including steps to verify placement of the cement as planned. e. Post IA remedial cementing diagnostics including but not limited to: i. Determination of top of cement (TOC) and evaluation of the cement quality in the IA. ii. Mechanical integrity tests of the tubing and IA every two years. iii. Water flow log in injection wells every two years. f Plan for future well abandonment meeting AOGCC regulations. g. Wellbore schematics showing: i. Current status ii. Post remedial IA cement iii. Proposed well abandonment Rule 2 The TOC in the IA is limited to no shallower than 500' MD above the UG4 formation top that correlates to the UG4 formation top of 3848' TVDss in Well PBU GC -2C and the TOC in the IA must be at least 1500' TVD below the surface casing shoe. Rule 3 A review of the IA remedial cement procedures and results, results of diagnostic work conducted on wells where IA remedial cement jobs were performed, post -remedial cementing diagnostics Conservation Order 736 February 9, 2018 Page 5 of 5 plan, and updated plan for well abandonment must be included as a part of the annual reservoir surveillance report for the given pool. Rule 4 Unless notice and public hearing are otherwise required, the AOGCC may administratively waive or amend the requirements of any rule stated above as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater. DONE at Anchorage, Alaska and dated February 9, 2018 Hollis S. French Chair, Commissioner Cath P. Forester Co issioner As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. Ooss'T LSM OSZS 0005 Oszv Lqn oosb _ OSZb sin OOob r vvsn OSL£ LAS OOSE i OSZE — ZAS o0Z LL W40 Z4 a OODE:T csI Id V6 0 A33(]H Si Oi H9 el 1ltlLZOvN wa3sAs a]ewp 0co of ►£6S :41dap leiol 6uo3 A gW :wnlep ualenay 3X-30 :a eu y045 :% E'fL :ua3ena9 OO/LL[ZBZOOS :JAAn JZ -:)O :1IaM Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Friday, February 09, 2018 3:06 PM To: DOA AOGCC Prudhoe Bay; Bender, Makana K (DOA); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody J (DOA); Davies, Stephen F (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); McPhee, Megan S (DOA); Rixse, Melvin G (DOA); Mumm, Joseph (DOA sponsored); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Regg, James B (DOA); Roby, David S (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Ballantine, Tab A (LAW); Erickson, Tamara K (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; AKDCWelllntegrityCoordinator; Alan Bailey; Alex Demarban; Alicia Showalter, Allen Huckabay; Andrew VanderJack; Ann Danielson; Anna Raff; Barbara F Fullmer, bbritch; bbohrer@ap.org; Ben Boettger; Bill Bredar; Bob Shavelson; Brandon Viator, Brian Havelock; Bruce Webb; Caleb Conrad; Candi English; Cody Gauer; Cody Terrell; Colleen Miller, Connie Downing; Crandall, Krissell; D Lawrence; Dale Hoffman; Danielle Mercurio; Darci Horner, Dave Harbour, David Boelens; David Duffy; David House; David McCaleb; ddonkel@cfl.rr.com; Diemer, Kenneth J (DNR); DNROG Units (DNR sponsored); Donna Ambruz; Ed Jones; Elizabeth Harball; Elowe, Kristin; Elwood Brehmer; Evan Osborne; Evans, John R (LDZX); Brown, Garrett A (DNR); George Pollock, Gordon Pospisil; Greeley, Destin M (DOR); Gretchen Stoddard; gspfoff, Hurst, Rona D (DNR); Hyun, James J (DNR); Jacki Rose; Jason Brune; Jdarlington Qarlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jill Simek; Jim Shine; Jim Watt; Jim White; Young, Jim P (DNR); Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); Jon Goltz; Chmielowski, Josef (DNR); Juanita Lovett; Judy Stanek; Kari Moriarty; Kasper Kowalewski; Kazeem Adegbola; Keith Torrance; Keith Wiles; Kelly Sperback; Frank, Kevin J (DNR); Kruse, Rebecca D (DNR); Kyla Choquette; Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Luke Keller; Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Michael Bill; Michael Calkins; Michael Moora; Michael Quick; Michael Schoetz; Mike Morgan; MJ Loveland; mkm7200; Motteram, Luke A; Mueller, Marta R (DNR); Nathaniel Herz; knelson@petroleumnews.com; Nichole Saunders; Nick Ostrovsky; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Renan Yanish; Richard Cool; Robert Brelsford; Robert Warthen; Sara Leverette; Scott Griffith; Shahla Farzan; Shannon Donnelly; Sharon Yarawsky; Skutca, Joseph E (DNR); Smith, Kyle S (DNR); Stephanie Klemmer; Stephen Hennigan; Sternicki, Oliver R; Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; sheffield@aoga.org; Tanisha Gleason; Ted Kramer, Teresa Imm; Tim Jones; Tim Mayers; Todd Durkee; Tom Maloney; trmjrl; Tyler Senden; Umekwe, Maduabuchi P (DNR); Vinnie Catalano; Well Integrity, Well Integrity; Weston Nash; Whitney Pettus; Aaron Gluzman; Aaron Sorrell; Ajibola Adeyeye; Alan Dennis; Andy Bond; Bajsarowicz, Caroline J; Bruce Williams; Casey Sullivan; Corey Munk; D. McCraine; Don Shaw; Eppie Hogan; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); Jamie M. Long; Jason Bergerson; Jesse Chielowski; Jim Magill; Joe Longo; John Martineck; Josh Kindred; Keith Lopez; Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; Steele, Marie C (DNR); Matt Armstrong; Melonnie Amundson; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Rachel Davis; Richard Garrard; Richmond, Diane M; Robert Province; Ryan Daniel; Sandra Lemke; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); William Van Dyke Subject: CO 736 (BPXA) Attachments: co736.pdf; co736 attachment.pdf Please see attached. Re: Rules for repair of packer leaks, tubing leaks ) Docket Number: CO -17-009 and production casing leaks using inner annulusi'l ) Conservation Order 736 remedial cement squeezes ) Prudhoe Bay Field Prudhoe Bay Oil Pool Pt. McIntyre Oil Pool Stump Island Oil Pool Lisburne Oil Pool Niakuk Oil Pool Aurora Oil Pool Borealis Oil Pool Orion Oil Pool Polaris Oil Pool Midnight Sun Oil Pool North Prudhoe Bay Oil Pool West Beach Oil Pool Raven Oil Pool Put River Oil Pool February 9, 2018 Jody J. CoCombie AOGCC SpeciaCAssistant A(aska OiCandGas Conservation Commission 333 West yfi Avenue Anchorage, Ateaska 99501 Office: (907) 793-1221 Fax: (907) 276-7542 CONFIDEN17ALITY NOTICE: This e-mail message, including any attachments, contains information from the Alaska Oil and Gas Conservation Commission (AOGCC(, State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are an unintended recipient of this e-mail, please delete it, without first saving or forwarding it, and, so that the AOGCC is aware of the mistake in sending it to you, contact Jody Colombie at 907.793.1221 or iodv.colombie@alaska aov. Ill "Inner annulus" means the space in a well between tubing and production casing. Bernie Karl K&K Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711 Anchorage, AK 99508-4336 Soldotna, AK 99669-7714 George Vaught, Jr. Darwin Waldsmith Richard Wagner P.O. Box 13557 P.O. Box 39309 P.O. Box 60868 Denver, CO 80201-3557 Ninilchik, AK 99639 Fairbanks, AK 99706 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Rules for repair of packer leaks, tubing leaks and production casing leaks using inner annulus remedial cement squeezes IT APPEARING THAT: Docket Number: CO -17-009 Conservation Order 736 Prudhoe Bay Field Prudhoe Bay Oil Pool Pt. McIntyre Oil Pool Stump Island Oil Pool Lisburne Oil Pool Niakuk Oil Pool Aurora Oil Pool Borealis Oil Pool Schrader Bluff Oil Pool Polaris Oil Pool Midnight Sun Oil Pool North Prudhoe Bay Oil Pool West Beach Oil Pool Raven Oil Pool Put River Oil Pool March 9, 2018 DECISION ON RECONSIDERATION 1. British Petroleum Exploration Alaska (BPXA), operator of Prudhoe Bay Field (PBF), Prudhoe Oil Pool has submitted Applications for Sundry Approvals for well work to repair tubing leaks and production casing leaks using remedial cement squeezes of the inner annulus (IA) in the following wells: G -11B (PTD 2809270) 15-48C(PTD 2110300) Y-24(PTD 1861130) 1 "Inner annulus" means the space in a well between tubing and production casing. Conservation Order 736 reconsideration March 9, 2018 Page 2 of 5 2. Pursuant to 20 AAC 25.540, the Alaska Oil and Gas Conservation Commission (AOGCC) on its own motion scheduled a public hearing for April 20, 2017. The purpose of the hearing was to receive testimony on IA cement squeezes to repair tubing leaks, production casing leaks and packer leaks. On March 12, 2017, the AOGCC published notice of the opportunity for that hearing on the State of Alaska's Online Public Notice website, on the AOGCC's website, electronically transmitted the notice to all persons on the AOGCC's email distribution list, and mailed printed copies of the notice to all persons on the AOGCC's mailing distribution list. On March 12, 2017, the AOGCC published the notice in the ALASKA DISPATCH NEWS. 3. Written comments were received from BPXA. 4. The AOGCC held the hearing as noticed. 5. The hearing was continued to August 15, 2017. Additional evidence was taken in the August 15 hearing. FINDINGS: 1. For producing wells capable of unassisted flow, AOGCC regulations require downhole production equipment consisting of suitable tubing and a packer that effectively isolate the tubing -casing annulus from fluids being produced. 2. For injection wells, AOGCC regulations require that in order to confirm continued mechanical integrity, the operator shall monitor the pressure in the casing -tubing annulus. 3. For injection wells, AOGCC regulations require a well to be equipped with tubing and a packer. The packer must be placed within 200 feet measured depth above the top of the perforations. 4. For production wells, Sustained Casing Pressure Rules require the Operator to monitor each development well daily to check for sustained pressure. The Operator must notify the AOGCC of sustained inner annulus pressure that exceeds 2000 psig. 5. BPXA has applied for IA remedial cement squeezes for wells that it believes have no future utility and cannot economically justify a rig workover to repair the leaks. 6. According to BPXA, the objectives of the IA remedial cementing method rules are to conserve Alaska petroleum resources and protect human safety and the environment through proper management of the IA. Proper management aims to mitigate the potential for failure of well integrity and prevent uncontrolled release of fluid or pressure, or threat to human safety. Conservation Order 736 reconsideration March 9, 2018 Page 3 of 5 CONCLUSIONS: 1. Annular casing pressure management techniques are used to maintain well control and prevent or mitigate unintended flow from development and injection wells. Those techniques rely on gathering surface pressure measurements to assess overall well integrity and properly design mitigations. Remedial cement squeezes in the IA of a well place cement in an attempt to isolate zones within the well that have identified loss of mechanical integrity. 2. IA cement squeezes may increase resource recovery in wells that have no future utility. IA cement squeezes may increase resource recovery from the pool by either returning a shut- in producer to production and thus capturing additional reserves near the well that would otherwise be lost, or by returning a shut in injector to service to provide injection support to offset producers and thus increase the ultimate recovery in those adjacent wells. 3. IA remedial cement squeezes reduce or compromise the ability to use annular casing pressure management to assess overall well integrity, maintain well control and prevent or mitigate unintended subsurface flow. IA remedial cement squeezes may prevent typical methods of diagnostic testing as described in API Recommended Practice 90-2, Annular Casing Pressure Management for Onshore Wells. 4. Without a depth limit, an IA remedial cement squeeze could eliminate the ability to monitor annular pressure at surface, and eliminate the number of independently monitored barriers used to ensure well integrity. 5. IA remedial cement squeezes may mask tubing leaks, casing leaks, cement channeling and other breaches in mechanical integrity. 6. IA remedial cement squeezes limit other methods of corrective action including future workover methods for repairing packer leaks, tubing leaks and production casing leaks. 7. IA cement squeeze procedures require the Application for Sundry Approval (10-403). The Sundry Application process is the appropriate process for remedial cementing of the IA. IA remedial cement may require waivers from AOGCC regulations. Conservation Order 736 reconsideration March 9, 2018 Page 4 of 5 NOW, THEREFORE IT IS ORDERED THAT: Rule 1 Remedial IA cement squeeze methods require an Application for Sundry Approval (10-403). The Sundry Application must include: a. A reserves analysis demonstrating the well has no future utility without the IA remedial squeeze. b. Cretaceous stratigraphy for the well. c. A detailed well history including the type and depth of leaks in the IA and diagnostics performed and the integrity of the outer annulus. d. IA cement squeeze procedure including steps to verify placement of the cement as planned. e. Post IA remedial cementing diagnostics including but not limited to: i. Determination of top of cement (TOC) and evaluation of the cement quality in the IA. ii. Mechanical integrity tests of the tubing and IA every two years. iii. Water flow login injection wells every two years. f. Plan for future well abandonment meeting AOGCC regulations. g. Wellbore schematics showing: L Current status ii. Post remedial IA cement iii. Proposed well abandonment Rule 2 The TOC in the IA is limited to no shallower than 500' MD above the UG4 formation top that correlates to the UG4 formation top of 3848' TVDss in Well PBU GC -2C and the TOC in the IA must be at least 1500' TVD below the surface casing shoe. Rule 3 A review of the IA remedial cement procedures and results, results of diagnostic work conducted on wells where IA remedial cement jobs were performed, post -remedial cementing diagnostics Conservation Order 736 reconsideration March 9, 2018 Page 5 of 5 plan, and updated plan for well abandonment must be included in an annual report for Prudhoe Bay Field due by March 31 covering the previous calendar year. Rule 4 An IA remedial cement packer squeeze is the repair of a packer leak with placement of less than 600 feet measured depth of cement in the inner annulus above the production packer. This cement packer squeeze is subject to Rule 1 except Rule 1 a, b, f, g(iii) are not required in the Application for Sundry Approval (10-403). Rule 5 Unless notice and public hearing are otherwise required, the AOGCC may administratively waive or amend the requirements of any rule stated above as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater. DONE at Anchorage, Alaska and dated March 9, 2018 Hollis S. French Chair, Commissioner Cath orester Commissioner APPEAL NOTICE This is the Commission's FINAL DECISION and may be appealed to superior court As provided in Rule 602, Ak.R.App.P., an appeal MUST be filed within 30 days after the date on which the Commission mails otherwise distributes this denial. Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Friday, March 09, 2018 12:57 PM To: DOA AOGCC Prudhoe Bay; Ryan Daniel; Bender, Makana K (DOA sponsored); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody J (DOA); Davies, Stephen F (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); McPhee, Megan S (DOA); Rixse, Melvin G (DOA); Mumm, Joseph (DOA sponsored); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Regg, James B (DOA); Roby, David S (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Ballantine, Tab A (LAW); Erickson, Tamara K (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; AKDCWellIntegrityCoordinator,, Alan Bailey; Alex Demarban; Alicia Showalter; Allen Huckabay; Andrew Vanderlack; Ann Danielson; Anna Lewallen; Anna Raff; Barbara F Fullmer; bbritch; bbohrer@ap.org; Ben Boettger; Bill Bredar; Bob Shavelson; Bonnie Bailey; Brandon Viator; Brian Havelock; Bruce Webb; Caleb Conrad; Candi English; Cody Gauer; Cody Terrell; Colleen Miller; Connie Downing; Crandall, Krissell; D Lawrence; Dale Hoffman; Danielle Mercurio; Darci Horner, Dave Harbour; David Boelens; David Duffy; David House; David McCaleb; ddonkel@cfl.rr.com; Diemer, Kenneth J (DNR); DNROG Units (DNR sponsored); Donna Ambruz; Ed Jones; Elizabeth Harball; Elowe, Kristin; Elwood Brehmer, Evan Osborne; Evans, John R (LDZX); Brown, Garrett A (DNR); George Pollock; Gordon Pospisil; Greeley, Destin M (DOR); Gretchen Stoddard; gspfoff, Hurst, Rona D (DNR); Hyun, James) (DNR); Jacki Rose; Jason Brune; Jdarlington Qarlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jill Simek; Jim Shine; Jim Watt; Jim White; Young, Jim P (DNR); Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); Jon Goltz; Chmielowski, Josef (DNR); Joshua Stephen; Juanita Lovett; Judy Stanek, Kari Moriarty, Kasper Kowalewski; Kazeem Adegbola; Keith Torrance; Keith Wiles; Kelly Sperback; Frank, Kevin J (DNR); Kruse, Rebecca D (DNR); Kyla Choquette; Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Luke Keller; Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Michael Bill; Michael Calkins; Michael Moora; Michael Quick; Michael Schoetz, Mike Morgan; MJ Loveland; Motteram, Luke A, Mueller, Marta R (DNR); Nathaniel Herz; knelson@petroleumnews.com; Nichole Saunders; Nick Ostrovsky; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Renan Yanish; Richard Cool; Robert Brelsford; Robert Warthen; Ryan Gross; Sara Leverette; Scott Griffith; Shahla Farzan; Shannon Donnelly; Sharon Yarawsky; Skutca, Joseph E (DNR); Smith, Kyle S (DNR); Stephanie Klemmer; Stephen Hennigan; Sternicki, Oliver R; Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; sheffield@aoga.org; Tanisha Gleason; Ted Kramer, Teresa Imm; Tim Jones; Tim Mayers; Todd Durkee; Tom Maloney; Tyler Senden; Umekwe, Maduabuchi P (DNR); Vinnie Catalano; Well Integrity; Well Integrity; Weston Nash; Whitney Pettus; Aaron Gluzman; Aaron Sorrell; Ajibola Adeyeye; Alan Dennis; Andy Bond; Bajsarowicz, Caroline J; Bruce Williams; Casey Sullivan; Corey Munk, D. McCraine; Don Shaw, Eppie Hogan; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Neusser, Heather A (DNR); Fair, Holly S (DNR); Jamie M. Long; Jason Bergerson; Jesse Chielowski; Jim Magill; Joe Longo; John Martineck; Josh Kindred; Keith Lopez, Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; Steele, Marie C (DNR); Matt Armstrong; Melonnie Amundson; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Rachel Davis; Richard Garrard; Richmond, Diane M; Robert Province; Sandra Lemke; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); William Van Dyke Subject: CO 736 (Reconsideration BPXA) Attachments: co736 reconsideration.pdf Please see attached. Decision on Reconsideration CO 736. Jody J. CoCombie .AOGCC SpeciaC.Assistant .ACaska OiCandgas Conservation Commission 333 West 7" .Avenue .Anchorage, .Alaska 99501 Office: (907) 793-1221 Fax: (907) 276-7542 CONFIDENTIALITY NOTICE: This e-mail message, including any attachments, contains information from the Alaska Oil and Gas Conservation Commission (AOGCC(, State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are on unintended recipient of this e-mail, please delete it, without first saving or forwarding if, and, so that the AOGCC is aware of the mistake in sending it to you, contact Jody Colombie at 907.793.1221 or mody.colombie@alaska.gov. Bernie Karl K&K Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711 Anchorage, AK 995084336 Soldotna, AK 99669-7714 George Vaught, Jr. P.O. Box 13557 Denver, CO 80201-3557 Darwin Waldsmith P.O. Box 39309 Ninilchik, AK 99639 Richard Wagner P.O. Box 60868 Fairbanks, AK 99706 r� pug � 4Y� n� v 9 CO736 Report 1 of 8 1/30/2024 7:20:51 AM Period Start: 01/01/2023 Period End: 12/31/2023 Asset Team(s): GREATER PRUDHOE BAY CO736 Report 2 of 8 1/30/2024 7:20:51 AM 01-31 Objective: Place 4096' of cement in IA to repair PC leak at 5450' MD. Expected TOC @~4500' MD. Results: Placed 4286' of cement in IA repairing PC leak at 5450' MD on 4/25/23, IA TOC= 4310' MD per SCMT of 5/1/23. Test Date Test Pressure (psi) Pass Test Event Type Next Due Date Duration Test Type Comments 5/6/2023 2,387 Y CMIT 5/6/2025 24 AOGCC Witnessed by Adam Earl 5/3/2023 2,110 Y MIT-T 5/3/2025 24 AOGCC Witnessed by Sully Sullivan Sundry_323-075_022323.pdf CO736 Report 3 of 8 1/30/2024 7:20:51 AM CO736 Report 4 of 8 1/30/2024 7:20:51 AM K-20C Objective: Pump ~4110' of cement into IA bringing TOC to ~4700' MD to repair a Tbg & PC leak both @ 5270' MD. Result: Pumped 4798' of cement in IA repairing PC leak. TOC in IA @ 4080' MD per RBT log of 1/2/23. Test Date Test Pressure (psi) Pass Test Event Type Next Due Date Duration Test Type Comments 10/22/2023 2,257 Y MIT-T 10/22/2025 24 AOGCC AOGCC Witness Adam Earl 9/27/2023 2,126 Y CMIT 9/27/2025 24 AOGCC AOGCC Witness Austin McLeod K-20C_APRIL2021_10-403.pdf CO736 Report 5 of 8 1/30/2024 7:20:51 AM CO736 Report 6 of 8 1/30/2024 7:20:51 AM L-112A Objective: Pump ~29.5 bbls' of cement into IA bringing TOC to ~8000' MD to repair tbg leak @ 9071' MD. Results: Pumped ~9.2 bbls' of cement in IA repairing tbg leak. TOC in IA @ 8681' MD per CBL log on 03/27/2023. Test Date Test Pressure (psi) Pass Test Event Type Next Due Date Duration Test Type Comments 3/29/2023 4,440 Y MIT-IA 3/29/2025 24 AOGCC AOGCC Witness Bob Noble Sundry_323-116_022723.pdf CO736 Report 7 of 8 1/30/2024 7:20:51 AM CO736 Report 8 of 8 1/30/2024 7:20:51 AM RECEIVED FEB 2 6 2018 A®GCC February 26, 2018 Via Hand Delivery Hollis S. French Commission Chair Alaska Oil and Gas Conservation Commission 333 West 7" Avenue, Suite 100 Anchorage, Alaska 99501 Re: Docket Number: CO -17-009 -Application for Reconsideration Conservation Order 736 (CO 736) Rules for repair of packer leaks, tubing leaks and production casing leaks using inner annulus remedial cement squeezes Prudhoe Bay Field Dear Chair French, BP Exploration (Alaska), Inc. (BPXA) as operator of the Prudhoe Bay Unit (PBU), respectfully submits this Application for Reconsideration regarding Conservation Order 736 issued on February 9th, 2018. BPXA appreciates the efforts of the commission to find a path forward allowing the use of inner annulus (/A) remedial cement squeezes for wells. In the oil and gas business, the decision to repair a well with non -rig means is often selected to improve the economics of a well, enabling the well to be returned to service at lower cost, and higher value. Non - rig IA remedial cement squeezes help extend the viable life of wells, leading to increased recovery and reduced well barrier risk. However, for the reasons discussed in this application, CO 736 contains certain requirements that BPXA will be unable to satisfy. In addition, some aspects of CO 736 require clarification. We therefore respectfully propose the following modifications to CO 736, to enable BPXA to act on these rules in applying for Sundry Approval for associated IA remedial cement squeeze wellwork. Application for Reconsideration Docket Number: CO -17-009 Conservation Order 736 Prudhoe Say Field February 26, 2018 Page 2 Proposed Amendments 1. Amendment of Rule la: Rule la of CO 736 requires that BPXA include with an Application for Sundry Approval (10-403) the following: Rule l.a: A reserves analysis demonstrating that a rig workover is not economically justifiable. BPXA respectfully requests that the commission remove Rule 1a. Economic analyses are performed independently by each company. Demonstrating that an alternative solution is "not economically justifiable", would be a matter of considerable debate, leading to a discussion of economic hurdles and investment portfolio management. Investments must be competitive, and each company has a different perspective, depending on its portfolio and view of market conditions. This information is competitively sensitive and subject to competition law restrictions, and the PBU owners do not share this information with each other. 2. Amendment of Rule 2: Rule 2 currently provides "...the TOC in the IA must be at least 1500' TVD below the surface casing shoe." BPXA requests that the 1500' TVD additional requirement be removed because the rule already provides that the 'TOC is limited to no shallower than 500' MD above the UG4 formation top." BPXA respectfully submits that there is no engineering basis or other integrity justification for the additional requirement that the TOC must be at least 1500 feet TVD below the surface casing shoe. 3. Amendment of Rule 3: Rule 3 of CO 736 requires that BPXA include the following: Rule 3: A review of the IA remedial cement procedures and results, results of diagnostic work conducted on wells where IA remedial cement jobs were performed, post -remedial cementing diagnostics and updated plan for well abandonment must be included as a part of the annual reservoir surveillance report for the given pool. BPXA respectfully requests that Rule 3 also be removed. We respectfully submit that the rule is administratively burdensome, duplicative, and the scope of the annual reservoir surveillance report is best kept to it's primary purpose, which is to review reservoir surveillance data. BPXA submits Reports of Sundry (10-404) which will include details of these specific wellwork operations. In addition, well integrity monitoring and report of anomalies to the commission is already required by CO 492 (and other Conservation Orders) along with any applicable Administrative Approvals. Application for Reconsideration Docket Number: CO -17-009 Conservation Order 736 Prudhoe Bay Field February 26, 2018 Page 3 4. Amendment of CO 736 title and to provide definitions consistent with the Proposed Sundry Matrix The title of CO 736 states "Rules for repair of packer leaks, tubing leaks, and production casing leaks using inner annulus remedial cement squeezes". BPXA respectfully requests that the title omit "repair of packer leaks" so that the rules can align with the proposed Wellwork Sundry Matrix job types submitted to AOGCC by BPXA on November 30, 2016. Examples pertinent to CO 736 include job types: Remedial Cement/ Packer Squeeze (small volume) and Remedial Cement/ Inner Annulus (large volume), which should have different governing rules. BPXA also respectfully requests that the AOGCC include the following definition in CO 736 to limit CO 736 to Remedial Cement/ Inner Annulus (large volume) only: "Remedial IA cement squeeze" is the repair of tubing or inner annulus casing integrity with placement of greater than 1000 feet measured depth of cement in the inner annulus above the production packer. In BPXA's proposed Wellwork Sundry Matrix, this activity would be referred to as "Remedial Cement/ Inner Annulus (large volume)". Adopting this definition would avoid an overlap with the definition of "Rules for repair of packer leaks" (defined as Remedial Cement/ Packer Squeeze (small volume) in BPXA's proposed Wellwork Sundry Matrix), which includes the repair of an existing mechanical packer or the placement of cement above an existing mechanical packer to access shallower zones (effectively replacing the packer). BPXA respectfully requests that CO 736 not apply to cement packer squeezes, because cement packer squeezes are already subject to Sundry Approval, and the additional requirements would be burdensome and duplicative. Justification for Reconsideration In summary, BPXA respectfully submits the following as justification for this Application for Reconsideration: 1. Elimination of Rule la: The requirement that Applications for Sundry Approval include reserves and economic analysis demonstrating that a rig workover is uneconomic, is a requirement that BPXA will be unable to satisfy. 2. Modification of Rule 2: There is no engineering or integrity basis for the requirement that the TOC in the IA must be at least 1500' TVD below the casing shoe. 3. Elimination of Rule 3: This rule, requiring BPXA include information regarding IA remedial cement procedures and results, would be administratively burdensome, duplicative, and is outside the Application for Reconsideration Docket Number. CO -17-009 Conservation Order 736 Prudhoe Bay Field February 26, 2018 Page 4 general purpose of the annual reservoir surveillance report, which is to review reservoir surveillance data. 4. Modification of CO 736 and definition: CO 736 should apply only to "remedial IA cement squeezes," and a definition of that term should be adopted consistent with the BPXA proposed Wellwork Sundry Matrix job types. For all these reasons, BPXA respectfully requests that the commission reconsider its order. BPXA and the PBU owners share AOGCC's focus on safety and integrity of PBU wells. BPXA would welcome further discussion of the proposed modifications to CO 736, to help understand and address any concerns. Sincerely, i� L_ Ryan Daniel Intervention and Integrity Engineering Team Leader BP Exploration (Alaska) Inc. cc: Eric Reinbold Jon Schultz Gerry Smith Gilbert Wong Dave White This file is considered to be confidential and is held in secure storage. AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 ALASKA OIL AND GAS CONSERVATION COMMISSION Before Commissioners: Cathy Foerster Daniel T. Seamount Hollis French, Chair In the Matter of the Application of BP Exploration Alaska, Inc. for Sundry Approvals for Well Work to Repair Production Casing Leaks and Tubing Leaks in Wells in the Prudhoe Bay Field, Prudhoe Oil Pool Using Remedial Inner Annulus Cement Squeeze Procedures. t No.: CO 17-009 ALASKA OIL and GAS CONSERVATION COMMISSION Anchorage, Alaska August 15, 2017 10:00 o'clock a.m. PUBLIC HEARING BEFORE: Cathy Foerster Hollis French Page 1 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.nct Page 2 1 TABLE OF CONTENTS 2 Opening remarks by Chair French 03 Remarks by Mr. Daniel 09 3 Remarks by Mr. Worthington 11 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.nct AOGCC 8/15/2017 1TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 3 1 P R O C E E D I N G S 2 (On record) 3 CHAIR FRENCH: I'll call this hearing to order. 4 It is August 15, 2017, it's 10:00 o'clock in the 5 morning. We're at 333 West Seventh Avenue, Anchorage, 6 Alaska, these are the offices of the Alaska Oil and Gas 7 Conservation Commission. We have a quorum to conduct 8 business. Cathy Foerster, Commissioner, is to my right 9 and I'm Hollis French, a Commissioner as well. 10 Today we're taking up docket number CO 17-009, 11 Applications for Sundry Approval. The Alaska Oil and 12 Gas Conservation Commission has received application 13 for sundry approvals from BP Exploration, operator of 14 the Prudhoe Bay field in the Prudhoe oil pool, for 15 approval of well work to repair production casing leaks 16 and tubing leaks in wells in the Prudhoe Bay field, 17 Prudhoe oil pool, using remedial inner annulus cement 18 squeeze procedures. The application for sundry 19 approvals are outlined below, PBUG 11B, PBU 15-48C, PBU 20 Y24, the first two producers, the final one an 21 injector. The hearing was continued from April 18, 22 2017, so that the operator could provide more 23 information. We're holding this hearing to determine 24 if a waiver from the provisions of the laws of the 25 state of Alaska and the regulations, rules and orders Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 4 1 of the AOGCC and the operation and repair of wells can 2 be granted to allow remedial cement squeezes of the IA, 3 the inner annulus, for repair of tubing leaks, 4 production casing leaks and packer leaks in these 5 wells. 6 Computer Matrix will be recording the 7 proceedings. You can get a copy of the transcript from 8 Computer Matrix Reporting. 9 I see two people signed up from BP to testify, 10 Mr. Ryan Daniel and Mr. Aras Worthington. Are there 11 any other parties intending to testify? 12 (No comments) 13 CHAIR FRENCH: I dont see any hands. The 14 Commissioners will ask questions during testimony. We 15 may also take a recess to consult with professional 16 staff to determine whether additional information or 17 clarifying questions are necessary. If a member of the 18 audience has a question that he or she feels should be 19 asked please submit that question to Jody Colombie in 20 writing. She will provide the question to the 21 Commissioners and if we feel that asking the question 22 will assist us in making our determinations we will ask 23 it. 24 For those testifying please keep in mind that 25 you must speak into the microphone so that those in the Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 5 1 audience and the court reporter can hear your 2 testimony. Also please remember to reference your 3 slides so that someone reading the public record can 4 follow along. For example refer to slides by their 5 numbers if numbered or by their titles if not numbered. 6 I think you all know the ground rules about what is 7 allowed relative to testimony. First all testimony 8 must be relevant to the purpose of the hearing I 9 outlined a few minutes ago and to the statutory 10 authority of the AOGCC. If anyone else decides to 11 testify they'll be given three minutes to do so. 12 Additionally testimony may not take the form of cross 13 examination. As I've said before the Commissioners 14 will be asking the questions. And finally testimony 15 that is disrespectful or inappropriate will not be 16 allowed. 17 Commissioner Foerster, do you have anything to 18 add before beginning the hearing? 19 COMMISSIONER FOERSTER: Not at all. 20 CHAIR FRENCH: Thank you. Let's go ahead and 21 get started then. 22 Gentlemen, please come forward, put yourselves 23 on the record, state your names and qualifications, if 24 you wish to be deemed expert witnesses give us the area 25 of expertise in which you are seeking expert Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 6 1 classification and your qualifications for that. 2 Thanks so much. Please. 3 MR. DANIEL: Good morning, Chair French, 4 Commissioner Foerster. Thank you for the opportunity 5 to reconvene and continue discussing remedial IA cement 6 squeeze procedures. My name is Ryan Daniel, I wish to 7 be represented as an expert witness for BPXA for 8 purposes of this testimony provided during the hearing. 9 I am the BP Exploration Alaska wells intervention and 10 integrity engineering team leader. My responsibilities 11 include oversight of lifecycle well integrity 12 management and compliance for Prudhoe Bay unit's 13 approximately 1,800 operated wells in Alaska. My role 14 also includes responsibility for regulatory interface 15 with -- interfacing with the AOGCC for drilling and 16 wells related activities and regulatory compliance. 17 I hold a bachelor of engineering degree in 18 mechanical engineering from Canterbury University in 19 Christchurch, New Zealand. I have 29 years of 20 postgraduate industry experience in well interventions, 21 operations and integrity management. I have worked for 22 BP in Alaska for the last 10 years and have been 23 involved in all aspects of well engineering and well 24 operations with a focus on lifecycle well integrity 25 management. Prior to joining BP I worked for Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 7 1 Schlumberger oil Field Services and held a number of 2 roles in the global locations around the world such as 3 Congo, South Africa, Italy and Australia, New Zealand, 4 Houston and Alaska. I am specialized in well line 5 logging, open and case hole and perforating 6 disciplines. I have subsequently held a number of 7 operations management, down -hole tool development and 8 engineering and sustaining roles. I have been a 9 resident in Alaska for 12 years and I'm a naturalized 10 USA citizen. 11 CHAIR FRENCH: Mr. Daniel, thank you. And if 12 you'd just restate the area in which you seek expert 13 qualification. 14 MR. DANIEL: Well integrity. 15 CHAIR FRENCH: Commissioner Foerster. 16 COMMISSIONER FOERSTER: I don't have any 17 problems with -- questions or problems with Mr. Daniel 18 being recognized as an expert. 19 CHAIR FRENCH: I agree. Mr. Daniel, you'll be 20 an expert testifier in that regard. 21 Thank you. 22 MR. DANIEL: Thank you, Chair French. 23 COMMISSIONER FOERSTER: Want to swear him in. 24 MR. DANIEL: Yes, I was going to suggest that 25 we proceed with the swearing in of my colleague, Aras Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/2017ITMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 8 1 Worthington, because we're going to jointly go through 2 the presentation if that's okay. 3 CHAIR FRENCH: That sounds perfectly adequate 4 to me. Go ahead, Mr. Worthington. 5 MR. WORTHINGTON: Good morning. Aras 6 Worthington, I'm the interventions and integrity 7 engineer for BP, Alaska. I have 23 years of 8 engineering and oil field experience, degreed engineer 9 from Purdue University in mechanical engineering and 10 also a licensed petroleum engineer in the state of 11 Alaska. My main fields of expertise are interventions, 12 rig workovers, drilling, coiled tubing drilling, plug 13 and abandonments and well integrity. I wish to be 14 recognized as an expert witness in interventions -- 15 well interventions. 16 CHAIR FRENCH: Commissioner Foerster. 17 COMMISSIONER FOERSTER: I have no questions and 18 no problems with recognizing Mr. Worthington as an 19 expert. 20 CHAIR FRENCH: I agree. So let's go ahead and 21 if you two gentlemen would raise your right hands. 22 (Oath administered) 23 MR. RYAN: I do. 24 MR. WORTHINGTON: Yes. 25 CHAIR FRENCH: Thank you, gentleman. Please Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/2017 ITMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 9 1 proceed as you wish, just identifying yourself for the 2 record as you go back and forth and we'll listen to 3 your presentation. 4 MR. DANIEL: Thank you very much, Chair French. 5 RYAN DANIEL 6 called as a witness on behalf of BPXA, Inc., testified 7 as follows on: 8 DIRECT EXAMINATION 9 MR. DANIEL: So starting on slide two, I 10 thought it appropriate just to give us a quick recap of 11 where we left off on April 18th. We went through our 12 oral testimony, we looked at some of the history of 13 inner annulus remedial cementing, we looked at 14 technical issues and we received a few questions. We 15 also talked briefly about industry standards and 16 conformance and compliance to the AOGCC regulations. 17 At that time post oral testimony we also supplied 18 copies of written testimony on record. 19 So slide three. So the April 17th hearing was 20 adjourned pending review of some investigation reports 21 requested by Chair Foerster at the time. These three 22 wells were Lisburne 5, well 13, which had a hydrocarbon 23 release in the first quarter of 2017, Prudhoe Bay well 24 02-03 which also had a hydrocarbon release incident 25 this year and there was also reference and a question Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/2017 ITMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 10 1 regarding a SoCal well down in California, Aliso Canyon 2 well SS -25 which had a sustained hydrocarbon release 3 which actually occurred back in 2015. 4 So remedial inner annulus cement squeeze 5 procedures have been used to repair wells in Prudhoe 6 Bay for approximately 20 years. So we've used cement 7 squeeze techniques to repair production packers, also 8 to allow us to kick off using coiled tubing drilling of 9 existing packers to target new zones. We've used inner 10 annulus cementing to repair casing leaks and tubing 11 leaks. 12 BPXA respectfully requests the AOGCC to grant 13 approval to the sundry applications pending with the 14 Commission and provide applicable regulatory waivers 15 facilitating this beneficial low risk well work 16 procedure as part of the wider sundry applications 17 process for these and other wells in the future. 18 BPXA has prepared a short presentation on the 19 subject wells to illustrate the use of remedial IA 20 cementing procedures. 21 I'm going to hand over to my colleague now and 22 he can walk us through some of the well examples. 23 Thank you. 24 ARAS WORTHINGTON 25 previously sworn, called as a witness on behalf of Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/2017 ITMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 11 1 BPXA, Inc., testified as follows on: 2 DIRECT EXAMINATION 3 MR. WORTHINGTON: Good morning, Aras 4 Worthington here. We had testified April 18th on these 5 three wells we're covering, we've got a Power Point 6 here, I'm on slide five now to illustrate pictorially 7 what we're doing to these wells to fix them. This 8 well, George 11, is a producer well. As noted before 9 it has several tubing leaks in the vicinity of 4,600 10 feet to 4,700 feet measured depth. The proposed 11 remediation is to place a cement plug in the IA, 12 isolating the leaks with a top of cement approximately 13 a thousand feet above the vicinity of the leaks at 14 3,500 feet measured depth. 15 Slide number six now. 16 CHAIR FRENCH: Mr. Worthington, this is 17 Commissioner French and my memory from your earlier 18 hearing was that the economics of this well would not 19 support pulling the tubing and replacing it, is 20 that..... 21 MR. WORTHINGTON: That's correct. 22 CHAIR FRENCH: .....still in -- that's still in 23 operation? 24 MR. WORTHINGTON: Still correct. 25 CHAIR FRENCH: That -- that's the problem, you Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TM0: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 12 1 can't pull the tubing, you got to have some other way 2 to fix the leak in the tubing? 3 MR. WORTHINGTON: That's correct. 4 CHAIR FRENCH: Questions based on that 5 question? 6 COMMISSIONER FOERSTER: No. 7 CHAIR FRENCH: No. Thank you. Go ahead. 8 MR. WORTHINGTON: This is well -- drill site 9 15, well 48, again slide six. This well, slightly 10 different scenario, we've got production casing leaks 11 at 5,300 feet measured depth. Again the post 12 remediation is to place cement in the IA with a top of 13 cement roughly a thousand feet above the leak at 4,000 14 feet measured depth. 15 CHAIR FRENCH: And maybe go back to that one 16 because that's maybe a good example of I know at least 17 some of the concern is that you can no longer tell with 18 a pressure gauge on the surface what's happening in 19 this annual space below the proposed cement job; is 20 that right? 21 MR. WORTHINGTON: That is correct. The 22 proposal was to set a plug in the tubing and test it 23 periodically every four years as an additional 24 verification nothing is going on below there, that 25 there are no leaks in the wellbore. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fan: 907-243-1473 Email: sahile@gci.net AOGC'C 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 13 1 CHAIR FRENCH: Thank you. 2 MR. WORTHINGTON: The last well we're talking 3 about here is Yankee 24, it is an injector as 4 Commissioner French noted. We have several tubina 5 leaks unsuccessfully patched at 10,100 feet measured 6 depth. Again the fix remediation here would be to 7 place cement in the IA with the top of cement at about 8 8,000 feet measured depth to isolate those leaks. 9 Questions on this slide? 10 CHAIR FRENCH: No, thank you. 11 MR. WORTHINGTON: That was slide seven. Slide 12 eight is a representation of L5-13 as noted by my 13 colleague, Mr. Daniel. This was a well that had a 14 hydrocarbon release in the first quarter of this year. 15 We had pressure tested this yellow envelope here, the 16 inner annulus and a leak developed during the pressure 17 test in the production casing very shallow, about 15 18 feet measured depth, and a corresponding leak in the 19 surface casing developed simultaneously and we had a 20 hydrocarbon release out the conductor flutes as such. 21 Next slide, slide number 9 I'm on now. This is 22 just to represent that once the hydrocarbon release 23 vented the pressure if you will from the pressure test 24 there was no more hydrocarbon release happening, but 25 this represents reservoir pressure, this blue envelope Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr, Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 14 1 that we're exposed to at this point. We have one 2 barrier to the reservoir pressure at this point, it's 3 the production tubing, the production packer and 4 associated wellhead equipment and minor -- this is just 5 a hypothetical, if we had IA cement in this well 6 already we would have at least had one more barrier 7 between surface and reservoir on the inner annulus side 8 and that would be cement, still have only one barrier 9 above the cement top which would be the production 10 tubing. In point of fact this lateral barrier was 11 installed in the well after the release as part of the 12 well P&A and well secure included tubing cement as 13 well, but..... 14 CHAIR FRENCH: And if I could ask a question 15 there. Assuming on this slide and what slide number is 16 this, I'm sorry? 17 MR. WORTHINGTON: This is slide number 9 -- 10. 18 Sorry. 19 CHAIR FRENCH: Assuming on slide number 10 that 20 you took that action of pumping cement in the lower 21 portion of the well, a tubing leak above that in the 22 future could only be repaired by more cement, you're no 23 longer in a position to pull the tubing from there on 24 forward, correct? 25 MR. WORTHINGTON: That -- that's partially Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 15 1 true. That is one way to do it. We could also 2 potentially cut tubing above the top of cement and 3 replace it if in the future that was economically 4 viable, but -- yeah. 5 CHAIR FRENCH: Most likely you're -- once you 6 start cementing your..... 7 MR. WORTHINGTON: Yeah. 8 CHAIR FRENCH: .....your future..... 9 MR. WORTHINGTON: Or you patch. 10 CHAIR FRENCH: .....is more cement or a patch? 11 MR. WORTHINGTON: Or we patch it. Patching 12 often is successful depending on the condition of the 13 tubing. 14 CHAIR FRENCH: Thank you. I don't see any 15 other questions. 16 MR. WORTHINGTON: All right. Now we're on 17 slide number 11. This is a representation of drill 18 site 2, well 3, which also had a hydrocarbon release in 19 this year. This well due to permafrost subsidence and 20 casing design factors, the wellhead moved upward 21 relative to the pad and damaged the tree and S -riser 22 against the wellhouse resulting in two surface leaks 23 represented up here above the wellbore. This blue 24 envelope is reservoir pressure again. Just 25 hypothetically slide number 11 if there were IA cement Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahilc@gci.net AOGCC 8/15/2017 1TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 16 1 in place in this well before the subsidence -induced 2 event it does not appear that the failure mode of this 3 well would have been any different, any more severe or 4 any different at all. 5 This is a representation of the Aliso Canyon 6 well, again not a BP well. All of this information is 7 obtained externally and we've turned that link -- those 8 links over to AOGCC for reference. This well was 9 actively and deliberately produced through a sliding 10 sleeve well valve deep in the well and up the inner 11 annulus. That's not something we do in Prudhoe Bay. 12 That gas pressure in the inner annulus, a leak 13 developed in the production casing and a gas leak down 14 -- apparently down through the surface casing shoe and 15 up broach to service. Again hypothetically speaking if 16 there was inner annulus cement in this well it would 17 have been very difficult if not impossible to produce 18 this well up the inner annulus in the first place and 19 would have been isolated from that leak at least by one 20 barrier provided that the tubing still had integrity 21 and the cement had integrity. 22 Questions on this slide? 23 CHAIR FRENCH: I don't see any. Thank you. 24 MR. WORTHINGTON: Slide 13. I'd like to turn 25 this back over to Mr. Daniel. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 17 1 MR. DANIEL: Thank you, Aras. So as I stated 2 when we started this morning, we greatly appreciate the 3 Commission's time today in providing an opportunity to 4 remove -- to provide and review additional testimony in 5 support of our inner annulus cementing work. We 6 respectfully request AOGCC to resume approving sundry 7 applications for this remedial IA cementing well work 8 and are open to any questions the Commission may have. 9 COMMISSIONER FOERSTER: Let me save my 10 questions until after we recess. 11 CHAIR FRENCH: All right. Then, gentlemen, I 12 think what we're going to do is take a -- say a 12 13 minute recess until 10:30, we'll confer with our 14 professional staff, come back on the record and then 15 finish up. With that we're in recess. 16 (Off record) 17 (On record) 18 CHAIR FRENCH: We're back from our recess. 19 It's 10:30, we're still on the record, you gentlemen 20 are still under oath. And I think Cath -- Commissioner 21 Foerster has some questions. 22 COMMISSIONER FOERSTER: They call me Cathy too. 23 Yeah, I just have a couple. When you had earlier sent 24 us in a bundle of workovers like this some of them had 25 cement that went much higher and we sent those back to Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/20171TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 18 1 you and did not approve them. What are your plans with 2 -- for those wells, do you intend to come forward with 3 any more wells like that because you don't show any of 4 that in here? 5 MR. DANIEL: Thanks for the question, 6 Commissioner Foerster. Our intent right now is 7 actually to focus on the types of wells that we have, 8 let me see, five, one, two -- basically slide three. 9 Aras, do you want to go to slide three, please. 10 So it is true that we have a hopper or a 11 portfolio of wells approaching 20 now, an estimated 5 12 mbd of light oil that's current shut in that can 13 benefit from this type of IA remedial squeeze well 14 work. Really the key parties for us right now are 15 cretaceous casing leaks, packer leaks, coiled tubing 16 drilling kick offs above existing packers, perhaps for 17 say rich gas perfs or for other coiled tubing drilling 18 sidetrack opportunities and deeper tubing leaks. I 19 will say on the record right now that this is our 20 priority depending on the Commission's view and whether 21 we are granted a waiver, we are certainly open to hold 22 back on some on the shallower repairs that have been 23 submitted in the past. This is an evolving technique, 24 we are looking at, you know, the success of this type 25 of well work, but that said the priority -- the Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/2017 1TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 19 1 majority of the oil is associated with the deeper leaks 2 probably down to about the cretaceous interval on down. 3 COMMISSIONER FOERSTER: Okay. I have one more 4 question for you. If you do these workovers is there 5 anything that would prevent you from running cement 6 bond logs on completion of the work. 7 MR. DANIEL: No, and you get a through tubing 8 cement bond log evaluation, the slim site logging tool 9 will be planned for most of this well work. We see 10 that as certainly a prerequisite to understand the 11 condition of the cement, the displacement efficiency of 12 the job. So..... 13 COMMISSIONER FOERSTER: And if you find 14 yourself with a poor cement job then what do you do? 15 MR. DANIEL: We'll consider other remedial 16 options right now, but I think, you know, if we hit a 17 poor displacement or we're concerned about the barrier 18 integrity behind the tubing string I would not be 19 moving forward with that well, putting it on 20 production. And that information would be available to 21 the Commission and the 404 submitted. 22 COMMISSIONER FOERSTER: And so you'd shut the 23 well in, you would do another workover, you would 24 suspend it? 25 MR. DANIEL: These wells are all shut in Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/2017 1TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 20 1 currently. So basically understanding or analyzing the 2 post job success would be dependent on running logs on 3 that work. If those logs demonstrated that we did not 4 have a competent barrier placed behind pipe as we had 5 intended we would have to look for other options, that 6 well would not be a candidate just to turn on. 7 COMMISSIONER FOERSTER: Okay. Okay. That's 8 all the questions I have. 9 CHAIR FRENCH: I don't have any further 10 questions either, gentlemen. Do you want to make a 11 closing statement or no? 12 MR. DANIEL: I think I'd just like to thank the 13 Commission and the staff engineers that have been 14 working with us over the past year, year and a half, 15 reviewing this well work. We see this as a lot of end 16 of life opportunity here to, you know, bring some of 17 this oil back online. These wells as we've discussed 18 on numerous occasions, these wells do have limited 19 future utility and they're also challenged 20 economically, but we feel that using these techniques 21 we can bring them on safely and produce them to the 22 benefit of both Alaska and of course the working 23 interest owners. I would encourage the Commission to 24 review, ask more questions, we can certainly look at 25 wells on a case by case basis as we submit sundries, Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 8/15/2017 1TMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 21 but we really need the Commission to move forward with the waiver that allows us to do this type of well work, but I see the checks and balances here. Each sundry -- each well would be subject to a sundry and reviewed plus a follow-up report, the 404. So I think you have the regulatory instruments to ensure and -- that these wells are safe and reliable. So with that -- Aras, do you have any closing statements? MR. WORTHINGTON: No, I think you've covered it quite well, Ryan. Thank you for asking. MR. DANIEL: So thank you. Thank you for your time. CHAIR FRENCH: Mr. Daniel, Mr. Worthington, thank you both. With that we'll go into adjournment and take the mater under advisement. At 10:35 we're adjourned. (Hearing adjourned) (END OF REQUESTED PORTION) Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 8/15/2017ITMO: APPLICATION OF BP EXPLORATION AK, INC., DOCKET NO. CO 17-009 Page 22 1 1 C E R T I F I C A T E 2 UNITED STATES OF AMERICA ) )ss 3 STATE OF ALASKA ) 4 I, Salena A. Hile, Notary Public in and for the 5 state of Alaska, residing in Anchorage in said state, 6 do hereby certify that the foregoing matter; Docket 7 No.: CO 17-009 was transcribed to the best of our 8 ability. 9 IN WITNESS WHEREOF I have hereunto set my hand 10 and affixed my seal this 24th day of August 25th day of 11 August 2017. 12 13 Salena A. Hile 14 Notary Public, State of Alaska My Commission Expires: 09/16/2018 15 16 17 18 19 20 21 22 23 24 25 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Docket No. CO -17-009 Continuation Hearing August 15, 2017 at 10:00 am NAME AFFILIATION Testify (yes or no) n �, kx, CG U0 Remedial IA cement squeeze procedures Docket number CO -17-009 Application for Sundry Approvals April 18th 2017 (initial hearing) August 15th 2017 (hearing reconvened) CO -17-009 April 181h hearing recap A public Hearing was held on April 181h 2017 to address the following with regard to remedial IA cement squeeze procedures — history — technical Issues & technical questions — conformance with Industry Standards (API) — compliance with AOGCC regulations BPXA provided oral testimony of Ryan Daniel BPXA provided oral testimony of Aras Worthington BPXA submitted copies of the written testimony Notice of Public Healing STATE OF ALASKA Alaska Oil and Gas CousetSullen Comudsslou Re: Docket Nu n ier: CO.17-009 APPLrntiorls for Sundt Approval The Alaska Oil and Gas Conservation Colmuissimt (AOGCC) las received Application for Stludy Approvals frau BP Explolntion(Alaeka) Jac (BPXA). operator ofdre Prudhoe Bay Field Paldh0c Oil Pool for approval of well work to repair production casing leaks and robing leaks it wells it the Pmd oe Bay Field. Pntdhoe Oil Pool using remedial inner annulus (IA) content squeeze puucednxs. The Application for Snrhy Approvals we outlined below: Wen Nage Pawn t9 Drill 8aa6ry Massy ACKCCn pt Pmposod Well Week Nmsber Date PBU 0.119, 308-027 11"94 9/17!16 Caneut 1A SSW to umiucet r .."Mae Wa.leaks P9U 15-48C, 311-030 316-513 10/4116 Cemeat G-nao W PoStac. repw pmdtcnW caunp leak P9U K34. 186-113 316530 l0/10116 Add-4000'ofttore�n us m color the IA m re ua rube leak Th@ AOGCC will hold a hearing t0 delelrrune if a waiver(s) flour die provisions Of the laws of the State of Alaska and the regulations. ides and orders of the AOGCC in the operations and repair of wells tali be panted to allow remedial cenet l squeezes of the LA to repair robing leaks. pioduction casing leaks and packer leaks it these wells. The AOGCC bold a public hearing on this lower April 18. 2017 at 9: W tint. That hearing was continued and willreconvene on August 1 t, +017 at IO:OOarn at 333 West 71h Avenue, Anchorage, Alaska 99501. In addition. written colnuWas regarding this application nwy be submitted to the AOGCC. at 333 West 7111 Avenue. Anchorage. Alaska 9950L Conmrews mist be received no later than die conclusion ofthe August 15, 2017 below g. n CO -17-009 April 181h hearing recap • The April 171h hearing was adjourned pending review of investigation reports for the following wells: — PBU well L5-13 Hydrocarbon release (Investigation Report submitted to AOGCC on 7/19/2017) — PBU well 02-03 Hydrocarbon release (Investigation Report submitted to AOGCC on 6/27/2017) — SoCal gas Aliso Canyon well SS -25 Hydrocarbon release (BP provided links to these external investigations via e-mail on 4/19/2017) Remedial IA Cement Squeeze Overview • Remedial IA cement squeeze procedures have been in use as a well repair mechanism in Prudhoe Bay for about 20 years — Production Packer Leaks (and CTD kick off above existing packers) — Production Casing Leaks — Production Tubing Leaks • BPXA respectfully requests that AOGCC grant approval to the sundry applications pending with the commission, and provide applicable regulatory waivers facilitating this beneficial, low risk well work procedure as part of the wider sundry applications process for these and other wells in future • BPXA has prepared a short presentation on the subject wells to illustrate the use of remedial IA cementing procedures... G-11 IA Cement Candidate Conductor A Surface Casing Production Casing Lin Lir IA cement placed to isolate tubing leaks. TOC 3500' MD. Tubing leaks from 4600'-4700' MD I Reservoir (Ivishak) 15-48 IA Cement Candidate Conductor Surface Casing Production Casing Lin Lir IA cement placed to isolate production casing Leak. TOC 4000' MD. Production Casing Leak @ 5300' MD Cretaceous Zone Reservoir (Ivishak) Y-24 IA Cement Candidate Conductor Surface Casing Production Casing Li IA cement placed to isolate tubing leaks. TOC 8000' MD �ubing Leaks unsuccessfully patched @ —10,100' MD Reservoir (Ivishak) L5-13 Barrier Diagram Conductor Leaks from Production Casing and Surface Casing developed during MITIA. Test fluid leakedthrough both casings and out through Conductor flutes Surface i Casing j Barrier Envelope being tested by MITIA. Production Casing Reservoir (Lisburne) Liner L5-13 Barrier Diagram Conductor Surface Casing At this point the well has only one barrier envelope to reservoir pressure: Production tubing, Tubing hanger seals, Production Packer, 7" Liner, and Liner Top Packer + Annular Cement Production Casing Reservoir (Lisburne) Liner L5-13 Barrier Diagram (hypothetical Conductor scenario) Surface Casing With IA cement in place there would have been 2 barriers in the IA, with single barrier exposure to reservoir pressure from the tubing above the IA cement Production Casing Reservoir (Lisburne) Liner 02-03 Barrier Diagram (hypothetical scenario) Conductor 1j Surface Casing Intermediate Casing Production Casing Liner Due to permafrost subsidence and casing design factors, the wellhead moved upward and damaged the tree and S -riser resulting in two surface leaks If there were IA cement in place on this well before the subsidence -induced event, it does not appear that the failure mode of this well would have been any different Reservoir (Ivishak) XX -25 Barrier Diagram (hypothetical Gas Production exited the wellbore through a casing leak @ —440' MD and flowed around the surface casing to surface scenario) Surface Casinf Gas Production was deliberately and actively flowed through Sliding Sleeve Valve and up Inner Annulus With IA cement in this well the specific mode of both "operation" and subsequent "blowout" that occurred on October 23,d 2015 would have been unlikely. This is assuming the inner annulus was monitored above the IA cement top, and the production tubing was sound Production Casing Liner Conclusion and Questions • BPXA greatly appreciate the commission's time today and the opportunity to provide additional testimony in support of Inner Annulus remedial cementing well work. • BP respectfully requests that the AOGCC resume approving Sundry Applications for remedial IA cementing wellwork • Any questions? Notice of Public Hearing Continuation STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket Number: CO -17-009 Applications for Sundry Approval The Alaska Oil and Gas Conservation Commission (AOGCC) has received Application for Sundry Approvals from BP Exploration(Alaska) Inc.(BPXA), operator of the Prudhoe Bay Field, Prudhoe Oil Pool for approval of well work to repair production casing leaks and tubing leaks in wells in the Prudhoe Bay Field, Prudhoe Oil Pool using remedial inner annulus (IA) cement squeeze procedures. The Application for Sundry Approvals are outlined below: Well Name Permit to Drill Sundry Number AOGCC Receipt Proposed Well work Number Date PBU G-1113, 208-027 316-494 9/27/16 Cement IA —5800' to producer repair multiple tubing leaks PBU 15-48C, 211-030 316-512 10/4/16 Cement IA —4000' to producer repair production casing leak PBU Y-24, 186-113 316-520 10/10/16 Add ---4000' of cement in injector the IA to repair tubing leak The AOGCC will hold a hearing to determine if a waiver(s) from the provisions of the laws of the State of Alaska and the regulations, rules and orders of the AOGCC in the operations and repair of wells can be granted to allow remedial cement squeezes of the IA to repair tubing leaks, production casing leaks and packer leaks in these wells. The AOGCC held a public hearing on this matter April 18, 2017 at 9:00 a.m. That hearing was continued and will reconvene on August 15, 2017 at 10:00am at 333 West 7th Avenue, Anchorage, Alaska 99501. In addition, written comments regarding this application may be submitted to the AOGCC, at 333 West 7th Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the August 15, 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907)279-1433 no later than August 9, 2017. ACathyoerster Chair, Commissioner STATE OF ALASKA ADVERTISING ORDER NOTICE TO PUBLISHER SUBMIT INVOICE SHOWING ADVERTISING ORDER NO., CERTIFIED AFFIDAVIT OFPUBWITH H ATTACHED COPY OF ADVERTISMENT. ADVERTISING ORDER NUMBER AO-17-032 FROM: Alaska Oil and Gas Conservation Commission AGENCY CONTACT: Jody Colombie/Samantha Carlisle DATE OF A.O.AGENCY 06/27/17 PHONE: (907) 279-1433 333 West 7th Avenue Anchorage, Alaska 99501 DATES ADVERTISEMENT REQUIRED: COMPANY CONTACT NAME: PHONE NUMBER: ASAP FAX NUMBER: (907) 276-7542 TO PUBLISHER: Alaska Dispatch News SPECIAL INSTRUCTIONS: PO Box 149001 Anchorage, Alaska 99514 TYPE OF ADVERTISEMENT: r LEGAL ;` DISPLAY Iu CLASSIFIED r OTHER (Specify below) DESCRIPTION PRICE COA 7-009 continuation Initials of who prepared AO: Alaska Non -Taxable 92-600185 ...... fiiiyvoke......rva QµDERNQ;;CEkTIl+lE4 iAFFIUAViT:QF:;:;:;: ''ryeG'ewhS,bywiyn.n?`rriCHGo eciry:gi*::::: .................................... Department of Administration Division of AOGCC 333 West 7th Avenue Anchorage, Alaska 99501 Pae I of 1 Total of All Pa es $ - REF Type Number Amount Date Comments I PVN JADN89311 2 AD AO-17-032 3 4 FIN AMOUNT SV Appr Unit PGM UGR Object FY I DIST LIQ ' 1 17 021147717 3046 17 2 3 4 52 Purch aingA anre: e: /� Pur Au o 's Si Telepho eNumber '1113 1. A.O. 8 and ;e&i ' g agency a must appear on all Invoices and documents relating to this purchase. 2. The state is registered fort transactions under Chapter 32, IRS code. Registration number 92-7 S K. Items are for the tuclusive use of the stale and not for resale. DISTRIBUTION Dfvlsmn FiscaUAtiginal AD . Coples .... Usher (faxed);,Dlvision F�s,C91 Recelv'it Form: 02-901 Revised: 6/27/2017 270227 0001407013 $298.80 STATE OF ALASKA RECEIVED JUL 0 7 2017 AFFIDAVIT OF PUBLICATION AOGCC THIRD JUDICIAL DISTRICT Joleesa Stepetin being first duly sworn on oath deposes and says that he/she is a representative of the Alaska Dispatch News, a daily newspaper. That said newspaper has been approved by the Third Judicial Court, Anchorage, Alaska, and it now and has been published in the English language continually as a daily newspaper in Anchorage, Alaska, and it is now and during all said time was printed in an office maintained at the aforesaid place of publication of said newspaper. That the annexed is a copy of an advertisement as it was published in regular issues (and not in supplemental form) of said newspaper on June 30, 2017 and that such newspaper was regularly distributed to its subscribers during all of said period. That the full amount of the fee charged for the foregoing publication is not in excess of the rate charged private individuals. Subscribed and sworn to before me this 30tWay ay of June, 2017 Notary Public in and for The State of Alaska. Third Division Anchorage, Alaska MY COMMISSION EXPIRES Ll/IL /21 Notice of Public Hearing Continuation STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket Number: CO -17-009 Applications for Sundry Approval The Alaska Oil and Gas Conservation Commission (AOGCC) has received Application for Sundry Approvals from BP Explorabon(Alaska) Inc.(BPxA), operator of the Prudhoe Bay Field, Prudhoe Oil Pool for approval of well work to repair production casing leaks and tubing leaks in wells in the Prudhoe Bay Field, Prudhoe Oil Pool using remedial inner annulus (IA) cement squeeze procedures. The Application for Sundry Approvals are outlined below: Well Name Permit to Drill Number Sundry Number AOGCC Receipt Date Proposed Well Work PBU G-1 1B, producer 208-027 316-494 9/27/16 Cement IA -5800' to repair multiple tubing leaks PBU 15-48C, producer 211-030 316-512 10/4/16 Cement IA -4000' to repair production casing leak PBU Y-24, injector 186-113 1 316-520 10/10/16 Add -4000' of cement in the IA to repair tubing leak The AOGCC will hold a hearing to determine if a waiver(s) from the provisions of the laws of the State of Alaska and the regulations, rules and orders of the AOGCC in the operations and repair of wells can be granted to allow remedial cement squeezes of the IA to repair tubing leaks, production casing leaks and packer leaks in these wells. The AOGCC held a public hearing on this matter April 18, 2017 at 9:00 a.m. That hearing was continued and will reconvene on August 15, 2017 at 10:OOam at 333 West 7th Avenue, Anchorage, Alaska 99501. In addition, written comments regarding this application may submitted to the AOGCC, at 333 West 7th Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the August 15, 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907)279-1433 no later than August 9, 2017. //signature on file// Cathy P. Foerster Chair, Commissioner FAN—GEIL'A M SIMMONS NOTARY PUBLIC State of Alaska missin Expires Apr. 14, 2021 Doug A. Cismoski P.E. BPXA Non -rig Well Operations Manager BP Exploration (Alaska), Inc. P.O. Box 196612 Anchorage, AK 99503-3954 Notice of Public Hearing Continuation STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket Number: CO -17-009 Applications for Sundry Approval The Alaska Oil and Gas Conservation Commission (AOGCC) has received Application for Sundry Approvals from BP Exploration(Alaska) Inc.(BPXA), operator of the Prudhoe Bay Field, Prudhoe Oil Pool for approval of well work to repair production casing leaks and tubing leaks in wells in the Prudhoe Bay Field, Prudhoe Oil Pool using remedial inner annulus (IA) cement squeeze procedures. The Application for Sundry Approvals are outlined below: Well Name Permit to Drill Sundry Number AOGCC Receipt Proposed Well work Number Date PBU G -IIB, 208-027 316494 9/27/16 Cement IA -58001 to producer repair multiple tubing leaks PBU 1548C, 211-030 316-512 10/4/16 Cement IA -4000' to producer repair production casing leak PBU Y-24, 186-113 316-520 10/10/16 Add -4000' of cement in injector the IA to repair tubing leak The AOGCC will hold a hearing to determine if a waiver(s) from the provisions of the laws of the State of Alaska and the regulations, rules and orders of the AOGCC in the operations and repair of wells can be granted to allow remedial cement squeezes of the IA to repair tubing leaks, production casing leaks and packer leaks in these wells. The AOGCC held a public hearing on this matter April 18, 2017 at 9:00 a.m. That hearing was continued and will reconvene on August 15, 2017 at 10:00am at 333 West 7th Avenue, Anchorage, Alaska 99501. In addition, written comments regarding this application may be submitted to the AOGCC, at 333 West 7th Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the August 15, 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907)279-1433 no later than August 9, 2017. //signature on file// Cathy P. Foerster Chair, Commissioner Bernie Karl M Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711-0055 Anchorage, AK 99508-4336 Soldotna, AK 99669-7714 George Vaught, Jr. Darwin Waldsmith Richard Wagner P.O. Box 13557 P.O. Box 39309 P.O. Box 60868 Denver, CO 80201-3557 Ninilchik, AK 99639-0309 Fairbanks, AK 99706-0868 Singh, Angela K (DOA) From: Carlisle, Samantha J (DOA) Sent: Tuesday, June 27, 2017 1:37 PM To: Ballantine, Tab A (LAW); Bender, Makana K (DOA); Bettis, Patricia K (DOA); Bixby, Brian D (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody J (DOA); Cook, Guy D (DOA); Davies, Stephen F (DOA); Eaton, Loraine E (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Herrera, Matthew F (DOA); Jones, Jeffery B (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); Mumm, Joseph (DOA sponsored); Noble, Robert C (DOA); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Quick, Michael J (DOA); Regg, James B (DOA); Roby, David S (DOA); Scheve, Charles M (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Singh, Angela K (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; AKDCWellIntegrityCoordinator, Alan Bailey, Alex Demarban; Alexander Bridge, Allen Huckabay; Andrew Vandedack; Ann Danielson; Anna Raff; Barbara F Fullmer, bbritch; bbohrer@ap.org; Ben Boettger; Bill Bredar, Bob Shavelson; Brandon Viator; Brian Havelock; Bruce Webb; Caleb Conrad; Candi English; Cocklan- Vendl, Mary E; Colleen Miller, Connie Downing; Crandall, Krissell; D Lawrence; Dale Hoffman; Darci Horner, Dave Harbour, David Boelens; David Duffy; David House; David McCaleb; David McCraine; ddonkel@cfl.rr.com; DNROG Units (DNR sponsored); Donna Ambruz; Ed Jones; Elizabeth Harball; Elowe, Kristin; Elwood Brehmer, Evan Osborne; Evans, John R (LDZX); George Pollock, Gordon Pospisil; Greeley, Destin M (DOR); Gretchen Stoddard; gspfoff; Hunter Cox; Hurst, Rona D (DNR); Hyun, James J (DNR); Jacki Rose, Jason Brune; Jdarlington garlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jill Simek; Jim Watt; Jim White, Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); John Stuart; Jon Goltz; Chmielowski, Josef (DNR); Juanita Lovett; Judy Stanek; Kari Moriarty; Kasper Kowalewski; Kazeem Adegbola; Keith Torrance, Keith Wiles, Kelly Sperback; Frank, Kevin 1 (DNR); Kruse, Rebecca D (DNR); Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Louisiana Cutler, Luke Keller, Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Mealear Tauch; Michael Bill; Michael Calkins, Michael Moora; Mike Morgan; MJ Loveland; mkm7200; Motteram, Luke A; Mueller, Marta R (DNR); Munisteri, Islin W M (DNR); knelson@petroleumnews.com; Nichole Saunders; Nick Ostrovsk); Nikki Martin; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Renan Yanish; Richard Cool; Robert Brelsford; Sara Leverette; Scott Griffith; Shahla Farzan; Shannon Donnelly, Sharon Yarawsky; Skutca, Joseph E (DNR); Smart Energy Universe, Smith, Kyle S (DNR); Stephanie Klemmer, Stephen Hennigan; Sternicki, Oliver R; Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; Sheffield@aoga.org; Ted Kramer, Teresa Imm; Tim Jones; Tim Mayers; Todd Durkee; Tom Maloney; trmjr1; Tyler Senden; Umekwe, Maduabuchi P (DNR); Vinnie Catalano; Well Integrity; Well Integrity, Weston Nash; Whitney Pettus; Aaron Gluzman; Aaron Sorrell; Ajibola Adeyeye; Alan Dennis; Andy Bond; Bajsarowicz, Caroline J; Bruce Williams; Bruno, Jeff J (DNR); Casey Sullivan; Corey Munk; Don Shaw; Eppie Hogan; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Dickenson, Hak K (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); Jamie M. Long; Jason Bergerson; Jesse Chielowski; Jim Magill; Shine, Jim M (DNR); Joe Longo; John Martineck; Josh Kindred; Keith Lopez, Laney Vazquez,, Lois Epstein; Longan, Sara W (DNR); Marc Kuck, Marcia Hobson; Steele, Marie C (DNR); Matt Armstrong; Melonnie Amundson; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Rachel Davis; Richard Garrard; Richmond, Diane M; Robert Province; Ryan Daniel; Sandra Lemke; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); Tostevin, Breck C (LAW); William To: Van Dyke Subject: Notice of Public Hearing Continuation (CO -17-009) Applications for Sundry Approval Attachments: CO -17-009 Public Hearing Notice Continued.pdf Please see attached. Samantha Carlisle Executive Secretary III Alaska Oil and Gas Conservation Commission 333 West 71^ Avenue Anchorage, AK 99501 (907)793-1223 CONFIDENTIAGITYNOTICE: This e-mail message, including any attachments, contains information from the Alaska Oil and Gas Conservation Commission (AC)GCC), State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are an unintended recipient of this e-mail, please delete it, without first saving or forwarding it, and, so that the AOGCC is aware of the mistake in sending it to you, contact Samantha Carlisle at (907) 793-1223 or Sammtha.Carlisle@almka.gov. AGOCC 4/182017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 ALASKA OIL AND GAS CONSERVATION COMMISSION Before Commissioners: Cathy Foerster, Chair Daniel T. Seamount Hollis French In the Matter of the Application of BP Exploration Alaska, Inc. for Sundry Approvals for Well Work to Repair Production Casing Leaks and Tubing Leaks in Wells in the Prudhoe Bay Field, Prudhoe Oil Pool Using Remedial Inner Annulus Cement Squeeze Procedures. Docket No.: CO 17-009 PUBLIC HEARING ALASKA OIL and GAS CONSERVATION COMMISSION Anchorage, Alaska April 18, 2017 9:00 o'clock a.m. Recorded and transcribed by: Computer Matrix Court Reporters, LLC 135 Christensen Drive, Suite 2 Anchorage, AK 99501 907-243-0668/sahile@gci.net Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/182017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Page 2 1 TABLE OF CONTENTS 2 Opening remarks by Chair Foerster 3 Remarks by Mr. Daniel 4 Remarks by Mr. Worthington 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 3 1 P R O C E E D I N G S 2 (On record - 9:03 a.m.) 3 CHAIR FOERSTER: We'll call this hearing to 4 order. It's April 18, 2017, the time is 9:03 a.m. 5 We're in the offices of the Alaska Oil and Gas 6 Conservation Commission located at 333 West Seventh 7 Avenue, Anchorage, Alaska. I'll introduce the bench. 8 To my left is Dan Seamount, to my right is Hollis 9 French and I'm Cathy Foerster. 10 Today's hearing is in regards to docket number 11 CO 17-009, Applications for Sundry Approval. The AOGCC 12 received applications for sundry approvals from BP 13 Exploration, operator of the Prudhoe Bay field, Prudhoe 14 oil pool, for well work to repair production casing 15 leaks and tubing leaks in wells in the Prudhoe Bay 16 field, Prudhoe oil field, using remedial inner annulus 17 cement squeeze procedures. The applications for sundry 18 approval that we'll be hearing on today are on well G- 19 11B and the proposed work is to cement the IA at about 20 5,800 feet to repair multiple tubing leaks; Prudhoe Bay 21 15-43C and that's also cement IA, but at about 4,000 22 feet to repair production casing leak; and then well Y- 23 24 to add 4,000 feet about -- approximately 4,000 feet 24 of cement in the inner annulus to repair tubing leak. 25 Today's hearing will be recorded by Computer Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahileegei.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 4 1 Matrix and you may receive a copy of the transcript 2 from them once they have it prepared. 3 I see that there are people from EP here 4 looking to testify. Is there anyone else wanting to 5 testify? 6 (No comments) 7 CHAIR FOERSTER: Okay. Seeing none. So I 8 think everybody in this room knows the rules on how the 9 test -- how we -- our hearings go so I won't belabor 10 that. Just remember to turn on both microphones and 11 try to speak into them so that people in the back of 12 the room can hear you and the court reporter can 13 capture your testimony. And if you have any overheads 14 be sure to reference them by number or by title so that 15 when people read through the record they can follow 16 along with you and it makes sense. 17 Commissioner Seamount, do you have anything to 18 add for the good of the order before we begin? 19 COMMISSIONER SEAMOUNT: I do not, Madam Chair. 20 CHAIR FOERSTER: Commissioner French? 21 COMMISSIONER FRENCH: No, thank you. 22 CHAIR FOERSTER: Okay. All right. Well, come 23 on up and first I'll swear you both in. 24 Raise your right hand. 25 (Oath administered) Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-069 Page 5 1 MR. DANIEL: I do. 2 MR. WORTHINGTON: I do. 3 CHAIR FOERSTER: Okay. So introduce yourself 4 by name and who you work for and then let me know if 5 you want -- wish to be acknowledged as an expert in a 6 relevant field and if you do then we'll go -- then 7 you'll need to give us your credentials so that we can 8 make the determination of expert or not. 9 MR. DANIEL: Good morning, Madam Chair, 10 Commissioners, and AOGCC staff. My name is Ryan Daniel 11 and I wish to be recognized by the Commission as an 12 expert witness representing BPXA for the purposes of 13 this testimony provided during the hearing. I am the 14 BP Exploration Alaska, Inc. wells intervention and 15 integrity engineering team leader. My responsibilities 16 include oversight of lifecycle well integrity 17 management and compliance for Prudhoe Bay unit's 18 approximately 1,800 operated wells in Alaska. My role 19 also includes responsibility for the regulatory 20 interface with AOGCC for drilling and wells engineering 21 activities and well operations regulatory compliance. 22 I hold a bachelor of engineering degree in 23 mechanical engineering from Canterbury University in 24 Christchurch, New Zealand. I have 29 years of 25 postgraduate industry experience in well interventions, Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste.2., Anch. AK99501 Fax: 907-243-1473 Email: sahileQigci.nel AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 6 1 operations and integrity management. I have worked for 2 BP in Alaska for the last 10 years and have been 3 involved in all aspects of well engineering and well 4 operations with a focus on lifecycle well integrity 5 management. Prior to joining BP I worked for 6 Schlumberger Oil Field Services and held a number of 7 roles in global locations such as Congo, South Africa, 8 Italy, Australia, New Zealand, Houston and lastly 9 Alaska. I initially specialized in well line logging, 10 open and case hole services and perforating 11 disciplines. I have subsequently held a number of 12 operations management, down -hole tool development, 13 engineering and sustaining roles. I have been a 14 resident in Alaska for the last 12 years and I'm a 15 naturalized USA citizen. 16 I respectfully request the Commission recognize 17 me as an expert witness in this matter. 18 CHAIR FOERSTER: Commissioner Seamount. 19 COMMISSIONER SEAMOUNT: I have no questions or 20 comments other than to say that just based on his last 21 name we should recognize him as an expert witness. 22 MR. DANIEL: Thank you, Commissioner Seamount. 23 COMMISSIONER SEAMOUNT: That was a joke by the 24 way for the record. 25 CHAIR FOERSTER: Commissioner French. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr, Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 7 1 COMMISSIONER FRENCH: No questions or comments 2 or objections. Thank you. 3 CHAIR FOERSTER: And I have no objections with 4 recognizing you as an expert in I'm assuming well 5 mechanics or well..... 6 MR. DANIEL: Well integrity. 7 CHAIR FOERSTER: .....well integrity. Okay. 8 All right. Please proceed with your testimony, Mr. 9 Daniel. 10 MR. DANIEL: So I'll go ahead. 11 RYAN DANIEL 12 previously sworn, called as a witness on behalf of 13 BPXA, Inc., testified as follows on: 14 DIRECT EXAMINATION 15 MR. DANIEL: So thank you for the opportunity 16 provided today to present testimony in support of inner 17 annulus remedial cement squeeze well work procedures in 18 general and to address any specific details of interest 19 on three wells tabled in the hearing notice. 20 As general background information pertinent to 21 this hearing BPXA has engaged the AOGCC on a number of 22 occasions in the preceding six to nine months. 23 Detailed technical data requests have been prepared and 24 submitted to the AOGCC in relation to planned inner 25 annulus and also outer annulus remedial cement squeeze Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 8 1 well work sundry applications. BPXA has also reviewed 2 the overall Prudhoe Bay unit well stock demographics 3 and associated production history in support of these 4 sundry applications with the AOGCC staff. 5 Prudhoe Bay unit is a mature, groundfield 6 operation with approximately 1,800 wells. Many of 7 these wells are approaching 40 years old and some 8 nearing end of life. Wells may vary in terms of 9 production and injection, wellbore utility and 10 operational viability. The wells are managed and 11 monitored throughout their respective lifecycle by 12 dedicated and professional teams to minimize health and 13 safety risks, prevent environmental damage and to 14 ensure compliance. BPXA as the operator of PBU, the 15 Prudhoe Bay unit, conducts multiple rig and non -rig 16 intervention jobs annually to maintain well stock and 17 operational availability. This well work builds on 18 BPXA's long and successful industry leading track 19 record of successful well interventions at giant field 20 scale which has delivered world class safety and 21 hydrocarbon recoveries. Both inner and outer annulus 22 remedial cement squeeze procedures provide significant 23 opportunity to restore well barrier integrity, re - 24 enabling production and injection operability and to 25 provide longer term risk mitigation for wells with Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr, Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.nel AGOCC 4/182017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 9I 1 tubing leaks, production petal leaks and production 2 casing leaks. These techniques have proven effective, 3 safe and low risk over many years in the Prudhoe Bay 4 unit. They are particularly suited to wells near end 5 of useful life and just sort of as a qualification with 6 limited or no long term utility such as sidetrack 7 potential or being workover candidates and as such have 8 the potential to make an important contribution to 9 Prudhoe Bay unit production. Conservative estimates 10 are that this technique could contribute production 11 approaching 5 mbd, 5,000 barrels of oil per day, which 12 is currently deferred indefinitely. It is worth noting 13 that any like cement barriers created in the inner and 14 outer annulus by this techniques are permanent and take 15 the well closer to final plug and abandonment status. 16 Cement is recognized by API and the industry as a 17 permanent well barrier for plug and abandonment and 18 zonal isolation purposes. 19 BPXA recognizes that surface pressure 20 monitoring of wells with partially or fully cemented 21 annuli is obviated below the top of the inner annulus 22 cement. In these cases BPXA proposed an additional 23 through tubing integrity assurance requirement with the 24 sundry application. Typically this is based on widely 25 used pressure testing, mechanical integrity tests of Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr, Ste. 2.,Anch, AK99501 Fax: 907-243-1473 Email: sahile(✓agci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 10 1 the tubing and of the inner annulus and also some leak 2 detection technologies where appropriate. This 3 additional assurance, in essence a well integrity down - 4 hole surveillance program, will be executed at a 5 reoccurring frequency which is typically analogous to 6 the underground injection control requirements for 7 injector wells here in Alaska for years and would be 8 based on the well specific risk and other factors for 9 the remaining life of the well. 10 BPXA respectfully requests the AOGCC grant 11 approval to the sundry applications pending with the 12 Commission and provide applicable regulatory waivers 13 facilitating this beneficial, low risk well work 14 procedure as part of the wider sundry applications 15 process for these and other wells in the future. 16 So I'll now hand off to my colleague, Aras 17 Worthington. 18 CHAIR FOERSTER: So we need to start of with 19 introduction of your name, who you represent and..... 20 MR. WORTHINGTON: Good morning. My name is 21 Aras Worthington, I wish to be recognized by the 22 Commission as an expert witness representing BP for the 23 purposes of testimony provided during this hearing. 24 I am an interventions and integrity engineer 25 for BP, a nearly lifelong Alaskan with a bachelor of Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sahileagci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 111 1 science in mechanical engineering from Purdue 2 University. I'm also a licensed petroleum engineer in 3 the state of Alaska, I have 23 years of engineering and 4 oil field experience within a wide variety of oil field 5 companies in the fields of interventions, rig 6 workovers, drilling, coiled tubing drilling, plug and 7 abandonments and well integrity. 8 CHAIR FOERSTER: Commissioner Seamount. 9 COMMISSIONER SEAMOUNT: Mr. Worthington, you 10 say you went to Purdue? 11 MR. WORTHINGTON: Yes, sir. 12 COMMISSIONER SEAMOUNT: Wow. Okay. I have no 13 questions or objections. 14 CHAIR FOERSTER: Commissioner French. 15 COMMISSIONER FRENCH: Likewise, no questions or 16 objections. 17 CHAIR FOERSTER: I have no questions and no 18 objections. Please proceed with your testimony. 19 MR. WORTHINGTON: Thank you. 20 CHAIR FOERSTER: We'll recognize you as an 21 expert in well integrity. 22 ARAS WORTHINGTON 23 previously sworn, called as a witness on behalf of 24 BPXA, Inc., testified as follows on: 25 DIRECT EXAMINATION Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/182017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 12 1 MR. WORTHINGTON: Placing cement in the inner 2 annulus of wells as a repair mechanism has been a 3 successful practice at Prudhoe Bay since circa 1999 or 4 for about the last 20 years. Packer leaks, production 5 casing leaks and production tubing leaks have been 6 successfully repaired by this techniques on dozens of 7 injectors and producers in the Prudhoe Bay unit with 8 approximately a 95 percent success rate. Remedial 9 cement squeeze techniques provide a low risk, safe and 10 reliable method for restoring well integrity. Treated 11 wells are also less likely to exhibit impairment in the 12 future lifecycle and are also pre-engineered for 13 efficient plug and abandonment. To the applicable 14 regulations cited by the AOGCC, BP respectfully 15 requests the Commission to find that inner annulus 16 cement, remedial cement squeeze techniques, satisfy 17 existing regulatory requirements. 18 20 AAC 25.200(d) which states that quote, all 19 producing wells capable of unassisted flow must be 20 completed with down -hole production equipment 21 consisting of suitable tubing and a packer that 22 effectively isolate the tubing casing annulus from 23 fluids being produced unless the Commission 24 specifically approves production through the annulus to 25 increase flow rate without jeopardizing ultimate Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gunet AGOCC 4/182017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 13 1 recovery from the well, unquote. BP's view is that a 2 cemented tubing casing annulus or inner annulus with an 3 existing production packer in place effectively 4 isolates that annulus from fluids being produced. In 5 instances where the existing production packer is in 6 need of repair remedial cement squeeze of the inner 7 annulus provides that repair and ensures that the 8 barrier still provides isolation from fluids being 9 produced. As well tubing leaks that are isolated by 10 500 feet or more of cement to cross and above the leaks 11 provides the isolation from produced fluids. Isolation 12 is verified by sonic log at the top of cement in the 13 inner annulus as well as pressure tests of both the 14 tubing and the inner annulus prior to putting the well 15 back into service. 16 20 AAC 25.412(b) states that quote, a well used 17 for injection must be equipped with tubing and a packer 18 or with other equipment that isolates the pressure to 19 the injection interval unless the Commission approves 20 the operator's use of alternate means to ensure that 21 injection of fluid is limited to the injection zone, 22 unquote. BP's view is that a cemented inner annulus 23 exactly as in a producing well whether the cement is 24 repairing a leaking production packer, tubing leaks or 25 production casing leak effectively isolates the Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sahilegg6met AGOCC 4/18/2017 1TMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 14 1 injection interval. Isolation on injectors is verified 2 by sonic logs to verify the top of cement in the inner 3 annulus as well as pressure tests of both the tubing 4 and inner annulus to be repeated every four years. 5 Also subsequent to resuming injection waterflow logs 6 and temperature warm back logs may be performed to 7 additionally ensure that all injected fluids are 8 confined and isolated to the intended zone. 9 20 AAC 25.412(b) further states that quote, the 10 packer must be placed within 200 feet measured depth 11 above the top of perforations unless the Commission 12 approves a different placement depth as the Commission 13 considers appropriate given the thickness and depth of 14 the confining zone, unquote. BP's view is that placing 15 cement in the IA, whether to repair a leaking packer or 16 not, does not change the location of the isolation from 17 the perforations. In addition cementing the IA 18 provides additional isolation above and beyond the 19 packer. 20 Moving on to the well specific details that 21 this hearing was to cover for the specific sundry 22 applications before the Commission today we have the 23 following comments. 24 Well G-11 is a producer with several tubing 25 leaks in the same vicinity from 4,600 feet to about Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 15 1 4,700 feet measured depth. It is currently shut-in and 2 not operable. Estimated recoverable oil from bringing 3 this well back online following repair is about 114,000 4 barrels. Placing about 5,800 feet of cement in the IA 5 to cover and seal off the leaks is the proposed repair 6 technique for this well. Current economics do not 7 justify any other known repair technique. This type of 8 tubing repair has been executed successfully on five 9 wells in the last 18 years. The top of cement in the 10 IA will be verified by sonic logs. Success of the 11 repair would be determined from IA and tubing pressure 12 tests which would recur every four years. 13 Well 15-48 is a producer with a production 14 casing leak at approximately 5,300 feet measured depth 15 and successfully patched tubing holes at about 6,700 16 feet measured depth. It is currently shut-in and not 17 operable due to the production casing leak. Estimated 18 recoverable oil from bringing this well back online 19 following repair is about 140,000 barrels. Placing 20 about 4,000 feet of cement in the IA to cover and seal 21 off the leak is the proposed repair technique for this 22 well. Current economics do not justify any other known 23 mechanism for this repair. This type of tubing repair 24 has been executed successfully on 15 wells in the last 25 18 years. The top of cement in the IA would be Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net A6000 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 16 1 verified by sonic logs, the success of the repair would 2 be determined from IA and tubing pressure tests which 3 would recur every four years. 4 Well Y-24 is a produced water injector with a 5 production tubing leak at about 10,110 feet measured 6 depth. It is currently shut-in and not operable. 7 Estimated recoverable oil from bringing this well back 8 online following repair is 90,000 barrels. Placing 9 about 4,000 feet of cement in the IA to cover off and 10 seal -- to cover and seal off the leak is that repair 11 -- the proposed repair technique for this well. 12 Current economics do not justify any other known 13 mechanism for repair. This type of tubing repair has 14 been executed successfully on five wells in the last 18 15 years. The top of cement in the IA would be verified 16 by sonic logs. The success of the repair would be 17 determined from IA and tubing pressure tests to be 18 repeated every four years and subsequent temperature 19 warm back logs and neutron waterflow logs while on 20 injection to ensure that all injected fluids are 21 confined and isolated to the intended zone. 22 PIP greatly appreciates the Commissions time 23 today and the opportunity to provide testimony in 24 support of inner annulus remedial cementing well work. 25 Any questions? Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahilecagci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 17 1 CHAIR FOERSTER: Commissioner Seamount, do you 2 have any questions at this time? 3 COMMISSIONER SEAMOUNT: I just have a couple 4 real quick. Are the producers HGOR wells? 5 MR. WORTHINGTON: Are they HGOR wells? 6 COMMISSIONER SEAMOUNT: Uh-huh. 7 MR. WORTHINGTON: Some of them are. 8 COMMISSIONER SEAMOUNT: What would be a typical 9 gas rate? 10 MR. WORTHINGTON: Fifty to 80. 11 COMMISSIONER SEAMOUNT: Eighty? 12 MR. WORTHINGTON: Yeah. 13 COMMISSIONER SEAMOUNT: Million a day? 14 MR. WORTHINGTON: Yeah. 15 COMMISSIONER SEAMOUNT: And it's been testified 16 that this -- these procedures are recognized by API as 17 an acceptable thing to do. Do they address gas rate at 18 all when talking about these procedures? 19 MR. DANIEL: Commissioner Seamount, I'll answer 20 that question. So in reference to API, API recognizes 21 cement as a barrier used in well construction, well 22 completion and well abandonment. We're intending and 23 have used per the testimony of my colleague, Aras 24 Worthington, for many years, other operators have as 25 well. API recognizes cement as a barrier in well Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 18 1 systems. what we're producing here using cement, 2 remedial cement, both in the IA and OA, is not 3 discussed at length in current literature with the API. 4 COMMISSIONER SEAMOUNT: Okay. Mr. Worthington 5 mentioned that these procedures have been performed a 6 number of times before, I see 18 and five wells, are 7 those in Prudhoe Bay? 8 MR. WORTHINGTON: Yes, sir. 9 COMMISSIONER SEAMOUNT: Okay. And when were 10 they done? 11 MR. WORTHINGTON: A few of them were done in 12 1999, most of them were done in the last two years. 13 COMMISSIONER SEAMOUNT: Last two years. Okay. 14 Thank you. That's all I have. 15 CHAIR FOERSTER: Commissioner French. 16 COMMISSIONER FRENCH: No questions. 17 CHAIR FOERSTER: Okay. I don't have any 18 questions at this time. I'd like to take a recess -- 19 oh, actually I do have several questions, but I'd like 20 to address my questions after a brief recess. 21 It's 9:25 so let's recess and come back at 22 9:40, about 15 minutes. We're recessed at 9:25. 23 (Off record) 24 (On record) 25 CHAIR FOERSTER: All right. We'll go back on Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 19 1 the record a few minutes early, it is 9:38. 2 Did you have any other questions you wanted to 3 ask, Commissioner Seamount? 4 COMMISSIONER SEAMOUNT: I have none. Thank 5 you. 6 CHAIR FOERSTER: Commissioner French. 7 COMMISSIONER FRENCH: No, thank you. 8 CHAIR FOERSTER: Okay. So I have a few. Is BP 9 familiar with API recommended practice 90-2 issued in 10 April of 2016? 11 MR. DANIEL: Yes, ma'am. 12 CHAIR FOERSTER: Is this recommended practice 13 that -- is your request consistent with that 14 recommended practice? 15 MR. DANIEL: Madam Chair, yes, it is. 90-2 is 16 the new sustained casing pressure management for land 17 base wells and it's actually a good practice and our 18 management of well repressurization is very much in 19 line with API's 90-2. 20 CHAIR FOERSTER: Okay. 21 MR. DANIEL: Even today the Commission have not 22 yet adopted it as -- in their regulations yet, I 23 understand plans are heading that way. 24 CHAIR FOERSTER: Okay. And is this -- is your 25 request in line with BP's internal well integrity Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sehile0aganet AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 201 1 policy? 2 MR. DANIEL: Yes, ma'am, it is. 3 CHAIR FOERSTER: And what is that policy 4 relevant to annular pressures? 5 MR. DANIEL: So BPXA essentially have adopted a 6 philosophy that's very analogous to 90-2 which was 7 published in April last year. We have had this in 8 place for about a decade actually. It has evolved a 9 little bit, it's very much focused on compliance with 10 conservation order 492 and the other orders following 11 the Alpha 22 well incident. Our internal policy is 12 called WIOP, well integrity operating practice, and it 13 sets out operating limits for our wells, for our annuli 14 specifically. Each well has an assigned operating 15 limit for its inner and outer annulus. Another key 16 component is monitoring and observation and reporting 17 of trends and anomalies for these wells. So we have a 18 very active well integrity management system that 19 really provides feedback every day on the health of the 20 well stock in the field, anomalies are reported through 21 to my team and then we take appropriate action to 22 diagnose those anomalies and past performance of engine 23 work or maybe it just requires a well bleed or 24 whatever. But this management system is sound, it's 25 robust and has been in place for many years. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahiic@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 211 1 CHAIR FOERSTER: Are there instances of 2 cemented annuli that build pressure even when they're 3 cemented to the surface? 4 MR. DANIEL: Yes, there are. We see this more 5 actually in outer annulus than the inner annulus. 6 Typically we will have on some workover operations a 7 micro annulus communication that will allow pressure to 8 build above the cement top. We typically treat those 9 wells with a top job of cement or increasingly over the 10 last few years have been using epoxy resins, an example 11 would be Well Lock, is one. One of the physical 12 conditions as you've raised the cement in an annulus, 13 particularly the outer annulus, your void space for the 14 pressure build-up becomes much smaller so your pressure 15 observation, your rights of pressure change, increase 16 more frequently or build at a higher rate in the outer 17 annulus. 18 Within the inner annulus we are aware of a few 19 jobs or wells, others can probably speak to this in 20 more detail, where we have a small amount of 21 repressurization above a remedial cement repair in the 22 inner annulus. 23 MR. WORTHINGTON: I can't say we can confirm 24 for sure that it's leaking through the cement on some 25 of these wells, but some of the injectors we've had Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/182017 1TMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 22 1 repressurization when we've had a small packer squeeze 2 done on it. So we're continuing to work on those wells 3 and diagnose them. 4 MR. DANIEL: One of the sort of I guess focus 5 areas is really pumping more cement than less, being 6 too conservative on your cement volumes. We're really 7 pushing at least 500 to 1,000 foot of cement in there 8 above these leaks, we're trying to build a bigger, 9 stronger, cement barrier in these wells. So I think 10 it's a -- you know, certainly it's a bit of a learning 11 curve, but we have across the field today a number of 12 wells with cement packers that have been repaired and 13 are very successful, they're not showing any signs of 14 repressurization from that cement top that we are aware 15 of today. There are other, you know, sources of 16 communication potentially in some of these wells over 17 time so it's hard to attribute unless it's directly 18 post -job a failed annuli cement job. 19 CHAIR FOERSTER: So when you cement the annuli 20 are there -- is there the potential for mechanical 21 integrity issues that would be masked by the cement? 22 MR. DANIEL: So the cement actually forms a 23 well barrier within the inner and -- basically between 24 the tubing in the production casing. The key is to get 25 a substantial column of cement above your known leak Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahileCugci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 23 1 points..... 2 CHAIR FOERSTER: Okay. So..... 3 MR. DANIEL: .....to provide the isolation. 4 CHAIR FOERSTER: Okay. So I didn't hear you so 5 I'll ask again. Is it possible that putting the cement 6 in could mask or keep you from being able to identify a 7 mechanical integrity issue? 8 MR. DANIEL: Yes, it is possible. 9 CHAIR FOERSTER: Okay. And what are the 10 ramifications of something like that? 11 MR. DANIEL: Typically if we have, you know, 12 enough cement within the tubing by production casing 13 annulus space an additional small impairment on either 14 string, you know, should not really pose any 15 significant risk. One of the methods we've proposed is 16 to make sure we go into these wells that have frequency 17 and do a pressure test on the tubing string. As I 18 indicated in my testimony you can no longer monitor the 19 inner annulus pressure below the cement top interface, 20 therefore we have to use alternate methods to be able 21 to do that. So we have a number of wells out at Port 22 Mac which have operated successfully for many years. 23 These wells require testing of the monobore section of 24 pipe below the packer. The packers are typically 25 fairly high set. There's probably more than half a Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 24 1 dozen wells out there. The methods we're proposing are 2 no different than that, basically sitting a tubing tail 3 plug deep in the well and pressure testing. And there 4 are also other methods of leak detection, we can run 5 temperature logs also looking for, you know, a small 6 flow or, you know, heat change, heat flex behind the 7 pipe, but we can't monitor pressure directly through 8 the cement interface. 9 CHAIR FOERSTER: All right. In addition to the 10 three wells we've got on the docket today how many 11 other wells do you anticipate might take advantage of 12 this type of procedure? 13 MR. DANIEL: So the wells fall into different 14 buckets of requirements so I'll spend a little bit of 15 time talking about the types of jobs. We have another 16 -- I'll say right now it's under 20 wells, it's 17 probably 16 or 17 wells we have in addition to the 18 three that the Commissioners are reviewing today. So 19 the wells -- the actual well work ranges from very 20 small packer repairs or pumping three to 500 feet of 21 cement into the inner annulus to obtain a coiled tubing 22 sidetrack exit, essentially establishing a new packer. 23 Some of the -- some of the bigger wells that we see 24 potential for today need to be recompleted or drilled 25 in a higher zone than the current packer sitting point. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 251 1 So one of the techniques would be to use inner annulus 2 cement to enable a higher exit above the packer. In 3 that particular case the cement then becomes the 4 equivalent of the packer, provides the well barrier 5 element of the exit point. 6 A second class of well are wells that still 7 have reserves associated with the current completion 8 that would be prudent to access. These wells may have 9 a production casing leak. So based on current industry 10 standards and economics this IA cementing, if we can 11 cover up the IA or the production casing leaks this 12 will allow us to restore the integrity of that well to 13 the point that we have two barriers to liquid, pressure 14 testing from surface which is really both the BP and 15 the AOGCC policy to allow a well to operate. We have 16 wells with small tubing leaks, washed out mandrels, 17 this sort of thing, that it's actually very -- a very 18 good method if we no longer require lift gas in the 19 annulus at that point we can use inner annulus remedial 20 cement to basically cover up those mandrels, provide a 21 barrier so essentially you're fixing the tubing here 22 not the production casing and that will restore those 23 wells to integrity as well. Some wells have a 24 combination, they're more difficult, they require more 25 cement in the inner annulus. But I think the biggest Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: mhile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 261 1 prize here is the ability to exit above an existing 2 packer into a new formation with coiled tubing 3 drilling, established a new packer and being able to 4 repair or mitigate production casing leaks which are -- 5 you're probably talking a workover of around, three, 6 four, 5 million, but with the associated risk of having 7 to decomplete the well at the same time. 8 So three or four buckets of activity. 9 Certainly the smaller jobs are lower risk, we even see 10 the -- you know, bringing up the cement higher in the 11 annulus is a conservative approach as well to restoring 12 integrity in some cases. 13 CHAIR FOERSTER: So since my question was how 14 many wells, it would be any well that has a casing 15 leak, a tubing leak or a packer leak which could be 16 essentially every single well in the field could end up 17 looking like this? 18 MR. DANIEL: So one part of my testimony 19 pointed to the fact that when we use inner annulus 20 cement this becomes a permanent piece of the 21 completion. And so this well would be very difficult 22 if not impossible to decomplete, to watch over a tubing 23 string that had even a few hundred feet of cement in 24 there. So one of the initial hurdles is this well 25 really needs to be one that's at the end of its useful Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 27 1 life. We're not planning to pump cement into wells 2 that definitely do have mechanical decompletion 3 capability. There are times when we will look at 4 designing the cement top to allow rotary sidetrack 5 below the surface casing shoe so we'll actually leave a 6 few hundred feet there to allow us to do a whipstock 7 exit there if we need. And as I say each well's 8 different and you're right potentially cement can be 9 useful for all sorts of leaks, but we're focused right 10 now on wells pretty much at the end of their useful 11 life. And a lot of the wells in Prudhoe Bay, we're 12 having our 40 anniversary this year, many of these 13 wells are -- you know, fall into that category. I 14 think right now I have just under -- well, actually 15 just over 200 nonoperable wells. Many of those have 16 some form of mechanical impairment that could 17 potentially be cycled back into the system if we can 18 repair and then test and maintain two barriers to 19 liquid. 20 CHAIR FOERSTER: Okay. So what is the -- what 21 would you call -- what would say is the success/failure 22 history of your OA cementing practice? 23 MR. WORTHINGTON: I'm sorry, could you..... 24 MR. DANIEL: IA or OA? 25 CHAIR FOERSTER: Both. What's your Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr, Ste. 2, Anch. AK 99501 Fax: 907-243-1473 Email: sahiler@igci.net AGOCC 1 success..... 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 28 2 MR. WORTHINGTON: Success rate. 3 CHAIR FOERSTER: .....success/failure history? 4 MR. WORTHINGTON: And so if -- in my testimony 5 I referenced that, but on the IA cementing is about 6 approximately 95 percent as we have a very good track 7 record. OA cementing we haven't done as many, but also 8 we have -- we've got a very good track record. I could 9 get back to you on the percentage there..... 10 CHAIR FOERSTER: Okay. 11 MR. WORTHINGTON: .....but it's very high. 12 CHAIR FOERSTER: Okay. And let me be clear in 13 -- when you say you still have two competent barriers 14 to flow you're considering the cement as a barrier and 15 the pipe as a barrier? 16 MR. DANIEL: No, I'm considering the cement -- 17 sorry. I'm considering the tubing as a primary barrier 18 and then the annulus space that we can monitor above 19 the cement interface as the (indiscernible) barrier. 20 But the barrier envelope does extend right down to the 21 packer typically on a (indiscernible) well. So you 22 have a composite barrier, you have two strings of pipe 23 and you have cement in between so effectively it's a 24 composite. 25 CHAIR FOERSTER: So two strings of pipe with Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahilercigci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 29 1 cement in between, you consider that two barriers? 2 MR. DANIEL: The construction method is two 3 barrier construction, but again it falls into a class 4 of unmonitorable annulus with solid cement in the 5 intersticial void. I think from the optics perspective 6 you could say, yes, it's starting to look like monobore 7 and I wouldn't disagree with you, but I would say that 8 through surveillance and logging and pressure testing 9 we can, you know, monitor any degradation of that 10 composite barrier over time. 11 CHAIR FOERSTER: So is it a composite barrier 12 or is it two barriers? 13 MR. WORTHINGTON: If I may, Cathy, maybe we can 14 clarify something. BP operates in a two barrier world 15 to surface. The environment down -hole we only require 16 one barrier between distinct permeable zones. So we're 17 not saying that we have two barriers because we've 18 cemented between the tubing and the annulus. We do 19 have two barriers to surface because we're able to 20 pressure test the inner annulus envelope down to 21 whatever the cement depth is, 500 feet, 5,000 feet, 22 8,000 feet, what have you. So that barrier -- that's 23 actually a secondary barrier and then your pressure 24 test -- your tubing inside that is your primary 25 barrier. That's where our two barriers come from. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 301 1 I hope that clarifies it. 2 CHAIR FOERSTER: It does. Do your major co - 3 owners support this proposed practice? 4 MR. DANIEL: Yes, they do, Commissioner. 5 CHAIR FOERSTER: Okay. Do they have 6 reservations about it? 7 MR. DANIEL: No, they don't. They have not 8 expressed any reservations about it..... 9 CHAIR FOERSTER: Okay. 10 MR. DANIEL: .....and quite the opposite, they 11 are supportive of our techniques in trying to restore 12 production on some of these end of life wells. 13 And..... 14 CHAIR FOERSTER: Okay. So if you cement these 15 annuli and we look further down the line how do you 16 properly P&A them according to Alaska regulations? 17 MR. WORTHINGTON: It's actually a lot easier at 18 that point because a good portion of the P&A is done. 19 That's also another smaller reason but a reason why you 20 might pump more cement while you're pumping it 21 because..... 22 CHAIR FOERSTER: So is cementing the tubing in 23 place..... 24 MR. WORTHINGTON: Excuse me. 25 CHAIR FOERSTER: .....something that considers Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 31 1 -- that BP considers the best practice for P&A? 2 MR. WORTHINGTON: I'm sorry, can you repeat 3 that question. 4 CHAIR FOERSTER: Is cementing the tubing in 5 place considered to be a best practice by BP for P&A? 6 MR. WORTHINGTON: For P&As? 7 CHAIR FOERSTER: Yes. 8 MR. WORTHINGTON: Yes, we typically do need 9 cement in the tubing by production casing, IA annulus. 10 We have typically a thousand feet between zones if we 11 can get it and typically 1,500 feet..... 12 CHAIR FOERSTER: Does..... 13 MR. WORTHINGTON: .....between those two 14 barriers. 15 CHAIR FOERSTER: .....cementing the entire 16 tipping string in place as part of a P&A comply with 17 AOGCC regulations? 18 MR. WORTHINGTON: Yes. 19 CHAIR FOERSTER: I just have a couple more 20 questions. When BP has an incident -- I mean, certain 21 incidents require a preliminary and a final report to 22 the AOGCC and I think we're anxious to get a couple of 23 those and one of them is on the L5-13. But we haven't 24 gotten either of those reports, either a preliminary or 25 a final report on those. And so I'm wondering if this Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/182017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 32 1 well had been IA cemented what remedies would you have 2 had to fix the problem on that well? 3 MR. WORTHINGTON: If it had already been 4 cemented? 5 CHAIR FOERSTER: Yes. 6 MR. WORTHINGTON: You might -- let's see. 7 MR. DANIEL: So I think I can provide an answer 8 there. So L5, to explain for the people gathered at 9 this hearing, this well broke down during a scheduled 10 four yearly pressure test of the inner annulus and it 11 also ruptured the outer annulus. So number 1 if the 12 outer annulus is full of cement that would have 13 actually provided a barrier and prevented the 14 hydrocarbon release to surface most likely on that 15 particular well. This well -- we're actually still in 16 the process of, you know, doing the upper completion 17 abandonment design so we have not conducted the 18 detailed forensics yet on the failing mechanism so it's 19 premature yet to talk about what if. We don't know 20 where the production casing yielded or burst so I can't 21 provide any information on that. 22 CHAIR FOERSTER: So there's information that we 23 could gain from this well that could shed light on the 24 proposed practice? 25 MR. DANIEL: You know, I don't think what we're Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Arch. AK 99501 Fax: 907-243-1473 Email: sahilerrgci. net AGOCC 4/182017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 33 1 proposing in terms of inner annulus, the deepest 2 meeting and the failing mechanism on this particular 3 well are -- I don't think there's a direct corollary 4 there. We certainly will obtain information if we can 5 readily on the failure mechanisms and share that with 6 the Commission staff. I'm also very interested in that 7 failing mechanism because it's something that we need 8 to look at closely. We have many hundred injectors out 9 there and we have been doing pressure testing for years 10 and the wells are getting older so if there's anything 11 we can learn to mitigate risk that's something I want 12 to take advantage of. 13 CHAIR FOERSTER: Okay. Along that same theme 14 we'll expect a preliminary and final report on the 15 drillsite 2, well number 3 incident. And the -- have 16 you learned anything from that well that could shed 17 light on our decision that we're making today? 18 MR. DANIEL: As I mentioned for L5-13 I don't 19 see these incidents linked. We are still in -- under 20 incident management unified command, there is no 21 information -- additional information I can share at 22 this time that the Commission do not already have. 23 CHAIR FOERSTER: Well, you may not think that 24 there's a connection, but we may disagree with you and 25 want to have that information as part of our Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr, Ste. 2., Anch. AK99501 Fax: 907-243-1473 Email: sahileoagunet AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 34 1 deliberation. And toward that end I would like to stay 2 this decision until we have more data on L5-13, on 2-3. 3 Does -- do either of you have a problem with 4 continuing the hearing until we have more..... 5 COMMISSIONER SEAMOUNT: I have no objection. 6 COMMISSIONER FRENCH: No objection. 7 CHAIR FOERSTER: Okay. So with that in mind 8 how long do you think it will take to give us -- to 9 give you time to have some information that can be 10 shared in this hearing? 11 MR. DANIEL: So we're actually working forward 12 on the Commission's requirement to completely P&A L5-13 13 within 60 days. So up until this last Friday when 14 things got a little more animated, that was our intent. 15 I think right now our focus in on drillsite 2, well 3. 16 We will endeavor to get back on track on L5-13 and 17 provide at least an initial report and some surface 18 diagnostics on that well. As I say we have not 19 established the mechanism or the leak via common 20 production casing yet. So I think..... 21 CHAIR FOERSTER: Are you going to be 22 requesting, you know, an extension on that 60 days? 23 MR. DANIEL: We will have to confer and..... 24 CHAIR FOERSTER: If you..... 25 MR. DANIEL: .....get back to the Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 1 Commission..... 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 351 2 CHAIR FOERSTER: Okay. Yeah, if..... 3 MR. DANIEL: .....after this meeting. 4 CHAIR FOERSTER: Don't assume that you just get 5 one. The -- ask for it. And so how long do you think 6 we need to continue this hearing to provide you 7 adequate time to be able to address these two wells and 8 their relevance to the request? 9 MR. DANIEL: I think L5-13 we can certainly get 10 the Commissioners a report within 60 days which was 11 originally planned and agreed with your staff. As I 12 say the drillsite 2, if that is your request that from 13 my perspective is still ongoing and I can't commit to 14 any time frame..... 15 CHAIR FOERSTER: Okay. 16 MR. DANIEL: .....just yet on that. 17 CHAIR FOERSTER: Okay. And then I'd like -- 18 I'll just add on there I'd like also to have you guys 19 address any relevance of your request to the Aliso 20 Canyon well. 21 Okay. well, with uncertainty as to when you 22 might have the additional information that we require 23 I'm at a loss to know when to continue the hearing 24 until. 25 MR. WORTHINGTON: L5-13 just verbally here, Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 36 1 we've placed approximately 1,600 feet of cement in the 2 inner annulus and the tubing as part of the plug an 3 abandonment. You were asking earlier if that -- if L5 4 -- I think you were asking, if L5-13 had had a 5 preemptive IA cement job of 1,600 feet we would have 6 only -- we would have already had two barriers through 7 one of the flow paths into the well via down to the 8 packer so we would have been in a better place on that 9 well if we had preemptively cemented it. We would have 10 still had a one barrier avenue through production 11 tubing, but it would have been less of a concern 12 because we would have already got barriers installed on 13 the well that are secondary or tertiary, so forth. 14 CHAIR FOERSTER: Okay. So I'll ask when do you 15 -- when would you like to -- when does BP think that 16 you can come in with answers to the questions that will 17 put the Commissioners at ease in making a ruling on 18 this request? 19 MR. DANIEL: So I'll go ahead and respond to it 20 if I can, Madam Chair. So I think we should be able to 21 provide a report on L5-13 within the 60 days as 22 originally planned. If it is your request to have some 23 at least initial findings on 02-03, I think it's going 24 to take at least another two months would be my best 25 estimate right now. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahileftci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO I7-009 Page 371 1 I can talk briefly on Aliso Canyon 2 (indiscernible) 6 if you wish or we can use..... 3 CHAIR FOERSTER: If we're going to be waiting 4 for the 02-03 results..... 5 MR. DANIEL: Right. Right. 6 CHAIR FOERSTER: .....you can do all three at 7 the same time, that's fine. 8 MR. DANIEL: Yeah, that was a different well, a 9 gas storage well as you may know which was flowing 10 through the casing and the tubing so not a usual 11 practice, nothing that BP or any operator in the..... 12 CHAIR FOERSTER: But it was essentially a 13 monobore? 14 MR. DANIEL: It was essentially a large, old, 15 single barrier well that sustained a shallow leak that 16 broached to surface. It had a sliding sleeve in the 17 tubing string and there was no way to control it from 18 the top, to pump into it. That wellhead had to 19 basically be intercepted with another wellbore and 20 killed which took 60 to 90 days. 21 CHAIR FOERSTER: So you said at least two 22 months so that puts us in mid June. You think or do 23 you think mid July would be better, mid August? 24 MR. DANIEL: So if I may try to target a date 25 now, we're on the 18th of April today, if it's Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahilc@agci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 38 1 acceptable for the Commissioners I think we can have an 2 initial view of the drillsite 2 failure within 30 days. 3 But as I say it'll be an initial view. If you wish a 4 more detailed report I think that we'll have to go 5 through the unified command piece of it as well. I 6 think the timing on that is at least 60 plus days out. 7 CHAIR FOERSTER: Well, I'm fine with..... 8 MR. DANIEL: So what is your preference, one 9 month? 10 CHAIR FOERSTER: .....I'm fine with a month, 11 but if we come back here and we still have questions 12 then we're going to be kicking the can. So I look to 13 you to..... 14 MR. DANIEL: Okay. 15 CHAIR FOERSTER: .....tell me what you want. 16 MR. DANIEL: Okay. So I would propose that we 17 confer with out management and then respond after this 18 hearing with a time that will enable us to provide the 19 information you seek. 20 CHAIR FOERSTER: Okay. So I'm going to look at 21 my -- I'm looking at my AAG. What's the procedure for 22 continuing until an unknown continuation date? 23 MR. BALLANTINE: (Indiscernible - away from 24 microphone)..... 25 CHAIR FOERSTER: Okay. We'll leave the record Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr, Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile(a)gci.net AGOCC 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 39 1 open for -- how long do you -- are you going to need a 2 day, two days, a week to decide? 3 MR. DANIEL: Oh, I think I should be able to 4 respond within 24 hours. 5 CHAIR FOERSTER: Okay. We'll leave the record 6 open until close of business tomorrow and at that time 7 we'll get a date from you when you think that you're 8 prepared to provide the information that the Commission 9 desires and we'll continue the hearing until that date. 10 Is that acceptable to everybody in the room 11 including the AAG in the back? 12 MR. BALLANTINE: (Indiscernible - away from 13 microphone)..... 14 CHAIR FOERSTER: Oh, okay. we'll -- then -- 15 okay. Then we're looking at least 30 days out. 16 June 22nd is a day that works. Are you saying 17 that you may want the two to three months, are you..... 18 MR. DANIEL: I would prefer to consult with my 19 colleagues..... 20 CHAIR FOERSTER: Okay. 21 MR. DANIEL: .....Madam Chair, and respond 22 within 24 hours per your previous proposal. 23 CHAIR FOERSTER: Okay. Well, why don't we just 24 leave the record open for -- until close of business 25 tomorrow and then based on what you say we'll renotice Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net SK1ZKS 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 401 1 and reschedule. 2 MR. DANIEL: That's fine. 3 CHAIR FOERSTER: Is that okay with the AAG in 4 the back of the room? 5 MR. BALLANTINE: (Indiscernible - away from 6 microphone)..... 7 CHAIR FOERSTER: Okay. So we don't need to -- 8 okay. We'll just leave the record open and renotice 9 for a continuation of the hearing. 10 All right. Well, at this point we will stop. 11 We'll leave -- done. 12 (Hearing recessed - 10:09 a.m.) 13 (END OF REQUESTED PORTION) 14 15 16 17 18 19 20 21 22 23 24 25 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahileQgci.nei AGOCC 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 4/18/2017 ITMO: APPLICATION OF BP EXPLORATION ALASKA, INC DOCKET No. CO 17-009 Page 411 TRANSCRIBER'S CERTIFICATE I, Salena A. Hile, hereby certify that the foregoing pages numbered 02 through 41 are a true, accurate, and complete transcript of proceedings in re: Docket No.: CO 17-009 public hearing, transcribed under my direction from a copy of an electronic sound recording to the best of our knowledge and ability. Date Salena A HHile, Transcriber Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile&ci. net STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Docket No. CO 17-009 April 18, 2017 at 9:00 am NAME AFFILIATION Testify (yes or no) 7v .j N Y u-� s M g nj-, cc - ac -,C C C 3 RECEIVED APR 17 2017 A� J.s \JC April 17, 2017 Via Hand Delivery Cathy P. Foerster Commission Chair Alaska Oil and Gas Conservation Commission 333 West 7th Avenue, Suite 100 Anchorage, Alaska 99501 Re: Docket Number: CO 17-009 Application for Sundry Approvals BPXA Written Testimony in support of Application Dear Chair Foerster: BP Exploration (Alaska) Inc., as operator of the Prudhoe Bay Unit, on behalf of the Prudhoe Bay Unit working interest owners, respectfully requests that the commission accept the enclosed written and sworn testimony for the referenced matter. Depending upon the testimony, if any, presented by others at the public hearing, BPXA reserves the right to present additional testimony at the public hearing, or by post -hearing submission if so authorized by the commission. Sincerely, s Doug A. Cismoski P. E BPXA Non rig well operations manager cc via email: Eric W. Reinbold, eric.w.reinboldCcaconocoohillias.com Gerry B. Smith, Gerry. B.SmithPexxonmobil.com Dave White, dewh(Mchevron.com STATE OF ALASKA Alaska Oil and Gas Conservation Commission Docket Number: CO -17-009 Application for Sundry Approvals Written Submittal of BP Exploration (Alaska), Inc. Sworn Testimony of Ryan Daniel Submitted April 17, 2017 COMMISSIONERS BP (Exploration) Alaska, Inc. ("BPXA"), as operator of the Prudhoe Bay Unit ("PBU") and on behalf of the PBU working interest owners ExxonMobil Alaska Production Inc., ConocoPhillips Alaska, Inc. and Chevron U.S.A. Inc., respectfully submits the following sworn testimony of Ryan Daniel. BPXA WITNESS This narrative is the submission of Ryan Daniel. His business address is 900 E. Benson Blvd., Anchorage, Alaska 99508. Mr. Daniel holds a Bachelor of engineering degree in mechanical engineering from Canterbury University in Christchurch, New Zealand. He has 29 Years of post- graduate industry experience in well interventions, operations and integrity management. Mr. Daniel has worked for BP in Alaska for the last 10 years and has been involved with all aspects of well engineering and well operations, with a focus on lifecycle well integrity management. Mr. Daniel is currently the wells Intervention and Integrity engineering team leader, with responsibilities that include oversight of lifecycle Well Integrity management and compliance for PBU's approximately 1800 operated wells. His role also includes responsibility for the regulatory interface with AOGCC for drilling and wells engineering activities and well operations regulatory compliance. Prior to joining BP Mr. Daniel worked for Schlumberger Oilfield Services and held a number of roles in global locations including Congo, South Africa, Italy, Australia, New Zealand, Houston and Alaska. Mr. Daniel initially specialized in wireline (open and cased hole), and perforating disciplines, and subsequently held a number of operations management and downhole tool development engineering & sustaining roles. Mr. Daniel has been a resident in Alaska for 12 years, and is a naturalized USA citizen. BPXA respectfully requests that the commission qualify Mr. Daniel as an expert in these proceedings in accordance with 20 AAC 25.540(c)(5). Mr. Daniel will be present, and made available to the Commissioners for questions, at the public hearing on this application Page 1 OATH BPXA requests that the commission authorize and recognize this submission as pre -filed written public testimony in support of its application. Based upon my expertise, knowledge, information and belief formed after reasonable inquiry, I certify and swear that the statements and information the Testimony section of this submittal are true and accurate. Ryan D-atriel� BP Exploration (Alaska), Inc. Page 3 STATE OF ALASKA Alaska Oil and Gas Conservation Commission Docket Number: CO -17-009 Application for Sundry Approvals Written Submittal of BP Exploration (Alaska), Inc. Sworn Testimony of Aras Worthington Submitted April 17, 2017 COMMISSIONERS BP (Exploration) Alaska, Inc. ("BPXA"), as operator of the Prudhoe Bay Unit ("PBU") and on behalf of the PBU working interest owners ExxonMobil Alaska Production Inc., ConocoPhillips Alaska, Inc. and Chevron U.S.A. Inc., respectfully submits the following sworn testimony of Aras Worthington. BPXA WITNESS This narrative is the submission of Aras Worthington. His business address is 900 E. Benson Blvd., Anchorage, Alaska 99508. Mr. Worthington holds a Bachelor of Science in Mechanical Engineering from Purdue University, and is a licensed Petroleum Engineer in the State of Alaska. He has 23 years of engineering oilfield experience within a wide variety of oilfield companies in the fields of Interventions, rig workovers, drilling, coiled tubing drilling, plug and abandonments, and well integrity. Mr. Worthington is currently an Interventions and Integrity Engineer for BPXA. BPXA respectfully requests that the commission qualify Mr. Worthington as an expert in these proceedings in accordance with 20 AAC 25.540(c)(5). Mr. Worthington will be present, and made available to the Commissioners for questions, at the public hearing on this application TESTIMONY Placing cement in the inner annulus of wells as a repair mechanism has been a successful practice at Prudhoe Bay since approximately 1999, or for about the last 20 years. Packer leaks, production casing leaks, and production tubing leaks have been successfully repaired by this technique on dozens of injectors and producers in PBU with approximately a 95% success rate. Remedial cement squeeze techniques provide a low-risk, safe, and reliable method for restoring well integrity. Treated wells are also less likely to exhibit impairment in the future life cycle, and are also pre-engineered for efficient plugging and abandonment (P&A). Page 1 Well Specific details For the specific sundry applications before the commission today, BPXA has the following comments: Well G-11 is a producer with several tubing leaks in the same vicinity from 4600' — 4700' measured depth. It is currently shut-in and not operable. Estimated recoverable oil from bringing this well back online following repair is 114,000 bbls. Placing 5800' of cement in the inner annulus to cover and seal off the leaks is the proposed repair technique for this well. Current economics do not justify any other known repair technique. This type of tubing repair has been executed successfully on five wells in the last 18 years. The top of cement in the inner annulus would be verified by sonic logs. The success of the repair would be determined from inner annulus and tubing pressure tests which would recur every four years. Well 15-48 is a producer with a production casing leak at 5300' measured depth and successfully patched tubing holes at —6700' measured depth. It is currently shut-in and not operable due to the production casing leak. Estimated recoverable oil from bringing this well back online following repair is 140,000 bbls. Placing -4000' of cement in the inner annulus to cover and seal off the leak is the proposed repair technique for this well. Current economics do not justify any other known mechanism for repair. This type of tubing repair has been executed successfully on fifteen wells in the last 18 years. The top of cement in the inner annulus would be verified by sonic logs. The success of the repair would be determined from inner annulus and tubing pressure tests which would recur every four years. Well Y-24 is a produced water injector with a production tubing leak at ^10,110' measured depth. It is currently shut-in and not operable. Estimated recoverable oil from bringing this well back online following repair is 90,000 bbls. Placing 4000' of cement in the inner annulus to cover and seal off the leak is the proposed repair technique for this well. Current economics do not justify any other known mechanism for repair. This type of tubing repair has been executed successfully on five wells in the last 18 years. The top of cement in the inner annulus would be verified by sonic logs. The success of the repair would be determined from inner annulus and tubing pressure tests to be repeated every four years and subsequent temperature "warmback" logs and neutron water -flow logs while on injection to ensure that all injected fluids are confined and isolated to the intended zone. BPXA respectively requests that AOGCC grant approval to the sundry applications pending with the commission, and provide applicable regulatory waivers facilitating this beneficial, low risk well work procedure as part of the wider sundry applications process for these and other wells in future. Page 3 Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket Number: CO -17-009 Applications for Sundry Approval The Alaska Oil and Gas Conservation Commission (AOGCC) has received Application for Sundry Approvals from BP Exploration(Alaska) Inc.(BPXA), operator of the Prudhoe Bay Field, Prudhoe Oil Pool for approval of well work to repair production casing leaks and tubing leaks in wells in the Prudhoe Bay Field, Prudhoe Oil Pool using remedial inner annulus (IA) cement squeeze procedures. The Application for Sundry Approvals are outlined below: Well Name Permit to Drill Sundry Number AOGCC Receipt Proposed Well work Number Date PBU G-1113, 208-027 316-494 9/27/16 Cement IA–5800' to producer multiple tubing leaks PBU 15-48C, 211-030 —repair 316-5 12 10/4/16 Cement IA –4000' to producer repair production casing leak PBU Y-24, 186-113 316-520 10/10/16 Add --4000' of cement in injector the IA to repair tubing leak The AOGCC will hold a hearing to determine if a waiver(s) from the provisions of the laws of the State of Alaska and the regulations, rules and orders of the AOGCC in the operations and repair of wells can be granted to allow remedial cement squeezes of the IA to repair tubing leaks, production casing leaks and packer leaks in these wells. The AOGCC has scheduled a public hearing on this matter for April 18, 2017 at 9:00 a.m. at 333 West 7th Avenue, Anchorage, Alaska 99501. In addition, written comments regarding this application may be submitted to the AOGCC, at 333 West 7th Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the April 18, 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907)279-1433 no later than April 11, 2017. a4/2—.- Cathy P oerster Chair, Commissioner STATE OF ALASKA ADVERTISING ORDER NOTICE TO PUBLISHER SUBMIT INVOICE SHOWING ADVERTISING ORDER NO., CERT1110) AFFIDAVIT OF PUBLICATION WIIR ATTACHED COPY OF ADVERTISMENT. ADVERTISFNGORDERNUMBER AO-17-025 FROM: AGENCY CONTACT: Jody Colombie/Samantha Carlisle Alaska Oil and Gas Conservation Commission DATE OF A.O.AGENCY PHONE: 333 West 7th Avenue 03/09/17 (907 279-1433 Anchorage, Alaska 99501 DATES ADVERTISEMENT REQUIRED: COMPANY CONTACT NAME: PHONE NUMBER: ASAP FAX NUMBER: 907) 276-7542 TO PUBLISHER: Alaska Dispatch News SPECIAL INSTRUCTIONS: PO Box 149001 Anchorage, Alaska 99514 TYPE OF ADVERTISEMENT: IW LEGAL I DISPLAY I CLASSIFIED i OTHER (Specify below) DESCRIPTION PRICE CO-17-009 Initials of who prepared AO: Alaska Non -Taxable 92-600185 ugp0Ar:IhYO1CesaowtnGnuveRnctNc: :: :::9RPER(NO;..f.GRTIFILO AFFIDA.VI]':QF:::::: :;:;?1l191:Ifi'[IQN: WY79 A'1'fACl 11 COPX'bP:':': .. guyERrISMENr.ro; ' .............................. ''.:...: Department of Administration Division of AOGCC 333 West 7th Avenue Anchorage, Alaska 99501 Pae 1 of I Total of All Pa es $ - REF Type Number Amount Date Commm6 I PVN JADN89311 2 Ao AO-17-025 3 4 FIN AMOUNT SY Appr Unit PGM LCR Objeet FV I DIST LIQ 1 17 021147717 3046 17 2 3 4 5 Purchasing Authority Name: Title: For oritys E Ign r Tdephone Number 1. A.O. # and receiving agency name must appear on all Invoices and documents relating to this purchase. 2. The state is registered for tont bee transactions under Chapter 32, IRS code. Regi— stretio . numbs 92-73-00m jte are for the reclusive use of the state and net for resale. DiSTRiBUTiOIY DivLNmn Ftse4UAriginal AO :CUptes PtibIL4lfer (faxed)Dtyisltjn Flsc>rl, Reeelwng2: Form: 02-901 Revised: 3/9/2017 270227 0001401647 $326.21 STATE OF ALASKA RECEIVED MAR 15 2017 AFFIDAVIT OF PUBLICATION AOGCC THIRD JUDICIAL DISTRICT Emma Dunlap being first duly sworn on oath deposes and says that he/she is a representative of the Alaska Dispatch News, a daily newspaper. That said newspaper has been approved by the Third Judicial Court, Anchorage, Alaska, and it now and has been published in the English language continually as a daily newspaper in Anchorage, Alaska, and it is now and during all said time was printed in an office maintained at the aforesaid place of publication of said newspaper. That the annexed is a copy of an advertisement as it was published in regular issues (and not in supplemental form) of said newspaper on March 12, 2017 and that such newspaper was regularly distributed to its subscribers during all of said period. That the full amount of the fee charged for the foregoing publication is not in excess of the rate charged private individuals. Signed Subscribed and sworn to before me this 13th day of March, 2017 Notary Put & in and for The State of Alaska. Third Division Anchorage, Alaska MY COMMISSION EXPIRES a/0 3i f Notice of Public Nearing STATE OF Alaska Oil and Gas conservation COmmisslon Re: Docket Number: CO -17-009 Applications for Sundry Approval The Alaska Oil and Gas Conservation Commission (AOGCC) has received Application for Sundry Approvals BP Exploration(Alaska) Inc.(BPXA ), operator of the Prudhoe Bay Field, Prudhoe Oil Pool for approval of work to repair production casing leaks and tubing leaks in wells in the Prudhoe Bay Field, Prudhoe Oil using remedial inner annulus (IA) cement squeeze for Sundry Approval outlined below: e procedures. The A_ Well Name Permit to Drill Number SundryNumber AOGCC Receipt Date .Proposed Well work PBU G-11 B, producer 206-027 316-494 9/27/16 Cement lA-5800'tore PBU 15-48C, multiple tubing leaks producer 211-030 316-512 10/4/16 cement lA -4000' to re PBU Y-24,1 production casing leak njector 186-113 316-520 10/10/16 Add-4000'of cement ii the IA to re it t b' I pa u mg t The AOGCC will hold a haring to determine if a waiver(s) from the provisions of the laws of the Stab to allow remedial a regulations, eem nt squles and eezes of he IA to epairr tubiGCC inng leaks operations duction casiinnlg of aksland packeraIf in these wells. The AOGCC has scheduled a public hearing on this matter for April 18, 2017 at 9:00 a.m, at 333 West Avenue, Anchorage, Alaska 99501. In addition, written comments regarding this application may be submitted to the AOGCC, at 333 West Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the April 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing cone the AOGCC at (907)279-1433 no later than April 11, 2017. AO -17-025 Published: March 12, 2017 10 Notary Public BRITNEY L. THOMPSON State of Alaska Lw ommission Expires Feb 23 , 2019 -Cathy P. Foen. Chair, Commissio Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket Number: CO -17-009 Applications for Sundry Approval The Alaska Oil and Gas Conservation Commission (AOGCC) has received Application for Sundry Approvals from BP Exploration(Alaska) Inc.(BPXA), operator of the Prudhoe Bay Field, Prudhoe Oil Pool for approval of well work to repair production casing leaks and tubing leaks in wells in the Prudhoe Bay Field, Prudhoe Oil Pool using remedial inner annulus (IA) cement squeeze procedures. The Application for Sundry Approvals are outlined below: Well Name Permit to Drill Sundry Number AOGCC Receipt Proposed Well work Number Date PBU G-1 113, 208-027 316494 9/27/16 Cement IA—5800' to producer repair multiple tubing leaks PBU 1548C, 211-030 316-512 10/4/16 Cement IA --4000' to producer repair production casing leak PBU Y-24, 186-113 316-520 10/10/16 Add —4000' of cement in injector the IA to repair tubing leak The AOGCC will hold a hearing to determine if a waiver(s) from the provisions of the laws of the State of Alaska and the regulations, rules and orders of the AOGCC in the operations and repair of wells can be granted to allow remedial cement squeezes of the IA to repair tubing leaks, production casing leaks and packer leaks in these wells. The AOGCC has scheduled a public hearing on this matter for April 18, 2017 at 9:00 a.m. at 333 West 7th Avenue, Anchorage, Alaska 99501. In addition, written comments regarding this application may be submitted to the AOGCC, at 333 West 7th Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the April 18, 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907)279-1433 no later than April 11, 2017. //signature on file// Cathy P. Foerster Chair, Commissioner Bernie Karl K&K Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711-0055 Anchorage, AK 99508-4336 Soldotna, AK 99669-7714 George Vaught, Jr. Darwin Waldsmith Richard Wagner P.O. Box 13557 P.O. Box 39309 P.O. Box 60868 Denver, CO 80201-3557 Ninilchik, AK 99639-0309 Fairbanks, AK 99706-0868 TA1a lLSL 3 -�-ki MO Singh, Angela K (DOA) From: Carlisle, Samantha J (DOA) Sent: Thursday, March 09, 2017 1:46 PM To: Nathan (nwhcmatrix@hotmail.com); Salena (sahile@gci.net); Ballantine, Tab A (LAW); Bender, Makana K (DOA); Bettis, Patricia K (DOA); Bixby, Brian D (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody J (DOA); Cook, Guy D (DOA); Davies, Stephen F (DOA); Eaton, Loraine E (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Grimaldi, Louis R (DOA); Guhl, Meredith D (DOA); Herrera, Matthew F (DOA); Jones, Jeffery B (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); Mumm, Joseph (DOA sponsored); Noble, Robert C (DOA); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Quick, Michael J (DOA); Regg, James B (DOA); Roby, David S (DOA); Scheve, Charles M (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Singh, Angela K (DOA); Wallace, Chris D (DOA); Aaron Gluzman; Aaron Sorrell; Ajibola Adeyeye; Alan Dennis; Assmann, Aaron A; Bajsarowicz, Caroline J; Bruce Williams; Bruno, Jeff J (DNR); Casey Sullivan; Catie Quinn; Corey Munk; David Tetta; Davis Mccraine; Don Shaw; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Dickenson, Hak K (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); Holly Pearen; Hyun, James J (DNR); Jamie M. Long; Jason Bergerson; Jesse Chielowski; Jim Magill; Joe Longo; John Martineck; Jon Stuart; Josh Kindred; Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Louisiana Cutler, Marc Kuck; Marcia Hobson; Steele, Marie C (DNR); Matt Armstrong; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Richard Garrard; Richmond, Diane M; Robert Province; Ryan Daniel; Sandra Lemke; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); Tostevin, Breck C (LAW); Wayne Wooster, William Van Dyke, AK, GWO Projects Well Integrity; AKDCWeIIIntegrityCoordinator, Alan Bailey; Alex Demarban; Alexander Bridge; Allen Huckabay; Andrew VanderJack; Ann Danielson; Anna Raff; Barbara F Fullmer, bbritch; bbohrer@ap.org; Ben Boettger, Bill Bredar, Bob Shavelson; Brandon Viator, Brian Havelock; Bruce Webb; Caleb Conrad; Candi English; Cocklan-Vendl, Mary E; Colleen Miller, Connie Downing; Crandall, Krissell; D Lawrence; Dale Hoffman; Darci Homer, Dave Harbour, David Boelens; David Duffy, David House; David McCaleb; ddonkel@cfl.rr.com; DNROG Units (DNR sponsored); Donna Ambruz; Ed Jones; Elizabeth Harball; Elowe, Kristin; Elwood Brehmer, Evan Osborne; Evans, John R (LDZX); George Pollock; Gordon Pospisil; Greeley, Destin M (DOR); Gretchen Stoddard; gspfoff; Hurst, Rona D (DNR); Jacki Rose; Jdarlington Qarlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jill Simek; Jim Watt; Jim White; Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); Jon Goltz; Chmielowski, Josef (DNR); Juanita Lovett; Judy Stanek; Kari Moriarty; Kasper Kowalewski; Kazeem Adegbola; Keith Torrance; Keith Wiles, Kelly Sperback; Frank, Kevin 1 (DNR); Kruse, Rebecca D (DNR); Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Luke Keller, Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Mealear Tauch; Michael Bill; Michael Calkins; Michael Moora; MJ Loveland; mkm7200; Motteram, Luke A; Mueller, Marta R (DNR); Munisteri, Islin W M (DNR); knelson@petroleumnews.com; Nichole Saunders; Nikki Martin; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Renan Yanish; Richard Cool; Robert Brelsford; Ryan Tunseth; Sara Leverette; Scott Griffith; Shahla Farzan; Shannon Donnelly; Sharmaine Copeland; Sharon Yarawsky; Skutca, Joseph E (DNR); Smart Energy Universe; Smith, Kyle S (DNR); Stephanie Klemmer; Stephen Hennigan; Sternicki, Oliver R; Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; sheffield@aoga.org; Ted Kramer; Teresa Imm; Thor Cutler; Tim Jones; Tim Mayers; Todd Durkee; trmjrl; Tyler Senden; Umekwe, Maduabuchi P (DNR); Vinnie Catalano; Well Integrity; Well Integrity; Weston Nash; Whitney Pettus Subject: Public Hearing Notice Attachments: CO -17-009 Public Hearing Notice.pdf Docket Number: CO -17-009 Applications for Sundry Approval Samantha Carlisle Executive Secretary III Alaska Oil and Gas Conservation Commission 333 West 71h Avenue Anchorage, AK 99501 (907) 793-1223 CONFIDENTIALITYNOTICEr This e-mail message, including any attachments, contains information from the Alaska Oil and Gas Conservation Commission (AOGCC), State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are an unintended recipient of this e-mail, please delete it, without first saving or forwarding it, and, so that the AOGCC is aware of the mistake in sending it to you, contact Samantha Carlisle at (907) 793-1223 or Samantha.Carhsle@alaska eov. BP Exploration (Alaska) Inc. Ryan Daniel, Well Integrity Engineering Team Leader Post Office Box 196612 Anchorage, Alaska 99519-6612 November 30th, 2016 Cathy P. Foerster Commission Chair Alaska Oil and Gas Conservation Commission 333 West 7`" Avenue Anchorage, Alaska 99501 RECEIVE® by NOV 3 0 2016 AOGCC Subject: BPXA request for approval of a proposed 2017 PBU sundry matrix for well work operations Dear Chair Foerster, BP Exploration (Alaska) Inc. (BPXA), as operator on behalf of the Prudhoe Bay Unit (PBO working interest owners, requests commission approval pursuant to 20 AAC 25.280(e), and 20 AAC 25.200(d) and 20 AAC 25.412(b), to modify the sundry requirements for pools in the PBU and approve the 2017 PBU sundry matrix attached to this letter. The current sundry matrix was approved by the commission in 2005. The 2017 PBU sundry matrix (red line) is based on the working draft provided by AOGCC. A number of technical meetings with AOGCC engineering staff have taken place in 2016 on related topics. BPXA has also responded to additional AOGCC requests for detailed well information regarding "end of life" well stock, well stock demographics and IA remedial cement squeeze procedures. BPXA fully support the commission's efforts to revise the sundry matrix and appreciates the operator engagement opportunity to update and improve the 2005 sundry matrix to better address new well work technologies and procedures. BPXA also recognise the benefits that the sundry matrix process provides in terms of increased efficiency and flexibility to preserve well stock that has potential utility. BPXA provides the following information in support of this request: Attachment 1: Digital copy of proposed 2017 PBU sundry matrix Attachment 2: Mark-up for development (Producer) wells Attachment 3: Mark-up for service (Injector) wells B?XA request for approval of a ,proposed 2017 PBU sundry matrix for well work operations 3C N'ovem'ber 2016 Page 12 Attachment 4: Mark-up for list procedures Attachment 5: History of IA remedial cement squeeze well work In summary, BPXA believe the proposed 2017 PBU sundry matrix provides improved operational flexibility, promotes the use of modern technology and proven safe well work practices, increased operational efficiencies, and provides a more pragmatic and risk based approach to well management, particularly for end of life wells in PBU. BPXA respectfully request commission approval of the 2017 PBU sundry matrix in accordance with 20 AAC 25.280(e), and 20 AAC 25.200(d) and 20 AAC 25.412(b) If you have any questions, please call me at 748-1140 Sincerely, Ryan Daniel BPXA Wells Integrity Engineering Team Leader Attachment 1: Digital copy of proposed 2017 PBU sundry matrix 2017 PBU Sundry Matrix.XLS J� 2017 PBU Sundry Matra (RD Nov29th< BPXA recluest'for approval of a proposed 2017 PBU sundry matrix for vvell work operations 30 November k16 Page 14 Attachment 2: Mark-up for development (Producer) wells Procedure Lists (Blue Bold) lists are available on page 3 DEVELOPMENT [PRODUCTION] WELLS") 10403 Not Required 10403 Not Required 10.403 Required 10404 Not Required 10-404 /407 Required 10-404 / 407 Required THRU-TUBING OPERATIONS THRU-TUBING OPERATIONS THRU-TUBING OPERATIONS • General Well Work List • Perforate new interval within a pool • Perforate a new pool • Surveys List • Imiall(Renwve Liner Top Packer • Plug & Abandon / Suspend / Reservoir Zonal Abandonment • Log Let • Dump bad cement • Run permarem/retrievable scab liner • ProductioNlajectlon Control List • Cut tailpipe or tubing • Set whipstock for sidetrack or lateral • Artificial Lift List • Install/Remove mechanical device (plug or packer) to control • Initial SSCSSSV valve installation & redesign fluid movement in zone. • Install Tubing Patch PUMPING OPERATIONS, INCLUDING USING COIL. PUMPING OPERATIONS, INCLUDING USING COIL PUMPING OPERATIONS, INCLUDING USING COIL • Pumping Operations List • Stimulate (HCL Mud acid) Remedial Cement/ Polymer List • Squeeze/plug to control fluid movement m zone Proppant or Acid Fracture Stimulation • Inject polymer for profile improvement RIG/COIL OPERATIONS RIGICOIL OPERATIONS RIG/COIL OPERATIONS • Mechanical Completions List • Casing Alterations List • Corod pull & set PCP stator • Velocity String instaNremove OTHER OPERATIONS OTHER OPERATIONS OTHER OPERATIONS • Replace/Repair tree, wellhead, or casing valves Repair well on starting head(bmdenhead connections • Convert producer to injector • Repair wellhead/tree/packoff with sealant material Operations Shutdown • Conduct suspended well inspection (initial & subsequent) Conductor extension or "cutaway". • Wrap/Clamp furmanne on wellhead Repair external Surface Casing • Plug for redrill • Topjub on surface casing by conductor annulus. (1) On n rnce_h�-aaca 6o•fe • vtnna ..,ai tie .e.,..:__.. a_ _ __�:_. �__ __.. __ .. ..... . ____ pe„Fwn, wcn ur oper ion, time wwr:c requests 9. 3 he operator should consult with the AOGCC to determine if a 10-403 is needed. W'M request for approval of a proposed 201 / PBU sundry rnatrix'for well work operations 30 November 2016 Pagt; 15 Attachment 3: Mark-up for service (Injector) wells xr, 10403 Not Required 10403 Not Required 10403 Required 10-404 Not Required 10404 / 407 Required 30-404 /407 Required THRU-TUBING OPERATIONS THRU-TUBING OPERATIONS THRU-TUBING OPERATIONS • General Well Work List Perforate new interval within a pool • Perforate a new pool • Surveys List InstaIfRemove mechanical device (plug or packer) to control • Cut tailpipe or tubing • Log List Fluid movement in zone. • Dump bad Cement • Production/Injection Control List InstaltRemove Liner Top Packer • Plug & Abandon / Suspend / Reservoir Zonal Abandonment • Ron permanent/retrievable scab Inver • Set whipstock for sidetrack or lateral • Install Tubing Patch PUMPING OPERATIONS, INCLUDING USING COIL PUMPING OPERATIONS, INCLUDING USING COIL PUMPING OPERATIONS, INCLUDING USING COIL • Pumping Operations List • Squeeze/plug to control fluid movement in zone • Remedial Cement / Polymer List • Inject Polymer for profile improvement • Proppant or Acid Fracture Stimulation • Water Wash Gas Injector • Stimulate (HCI, Mud acid) RIG/COIL OPERATIONS RIG/COIL OPERATIONS RIG/COIL OPERATIONS • Mechanical Completions List • Casing Alterations List OTHER OPERATIONS OTHER OPERATIONS OTHER OPERATIONS • Replace/Repair tree, wellhead, or casing valves • Inject well MIT (on MIT form) • Wmp/Cinmp furmanite on wellhead • WAG Swaps • Convert from initial water injector to WAG injector • Repair external surface casing • Convert from injector to producer if flowing back • Top job on surface casing by conductor annulus. for more than 30 days • Operations Shutdown • Repair weld on Starting head/Bradenhead connections • Conductor extension or "cutaway". • Sealant Material & Conductor fill • Plug for redri0 • Repair weWead/tree/packoff with sealant material • Convert Injector to Producer • Conduct suspended well inspection (initial and subsequent) - ---, --- ,» needed. nw u< •Qyaaw wI a P4ncumr wea or operaron u me AVt C requests A. The operator should consult with the AOGCC to determine if a 10403 is (2) Operations on disposal wells: operator must contact AOGCC to determine Sundries required. 313XA request for approval of a proposed 2017 PBU sundry rnatrix for vvell work operations 30 Novemoer 2016 Page 16 Attachment 4: Mark-up for List procedures Procedure lists for Printouts. No Reports Required General Well Work: Surveys: Well Logs: ProductioNlnjection: Artificial Lift: Pumping Operations: Tag Fill Pressure (CNL) Compensated Neutron Water Flood Regulator Change GLV Scale Inhibition Treatment Set or pull retrievable plugs Temperature (TDT) Thermal Decay Time Sliding Sleeve Change downhole pump/ Sludge not in zone (secure wells) Spinner (CO) Carbon Oxygen AVA Nipple (jetpump/ESP) Ice Plug Run dummy drift or gauge ring Obtain bottom hole sample (CCL) Casing Collar Locator Production Mandrel Install/remove packoff/patch GLM Freeze protect Patch tubing GYM Cement Log Downhole Choke Inhibitor squeeze Dump or bag sand/ sluggits Prod/Inj profile Temperature Reperforate existing interval Perform hot og treatment Tubing scrapes (scale, Pressure Isolation sleeve regulator valve Acidice Tubing paraft-in,etc.) Video Sand or Rock screen CTU clean out Install or Change SSS V Caliper Slum gun / Stun tube FCO Nr or Injection Valve Acoustic LDL Displace well with fluid Corrosion Flowback after stimulation Nitrogen lift Booster pump in conductor Sand consolidation Treatment Schmon-B-Gone 1-2 Reports Required Remedial Cement/ Polymet Mechanical Completion: Casing Alte rations: Casing Shoe Pull Tubing Casing patch OA Down Squeeze Mill Packer Straddle packer PC Leak Install Velocity String Subsidence repair Micro -annulus Down Squeeze ESP completion Replace casing Inner Annulus (large vol) Jet pump completion Scab liner Outer Annulus Gravel Pack Tiebacks Packer Squeeze (small vol) Stack Packer BPXA request for approval of a proposed 2017 PBU sundry matrix for well work operations 30 November 2016 Page 17 Attachment 5: IA Remedial Cement Squeeze History Well Date Sundry Will Risk Estimated BP Packer Tubing Production Surface Notes Sundry Status Mitigation IOR Operability Squeeze Leak Casing Casing Submitted be Status Leak Leak achieved via repair? 17-08i 8/19/2014 Approved Yes 140 Operable X 10/24/14 13-17i 224/2015 Approved Yes 150 Operable X 325/15 G-27 2/32015 Approved Yes 100 Operable X CTD Sidetrack Prep 3/3/15 L1-27 5/82015 Approved Yes 100 Operable X 5/14/15 1-5-21 6/92015 Approved Yes 660 Operable X X 6/30/15 P7-13 7/72015 Approved Yes 400 Operable X 7/14/15 K-09 5272015 Approved Yes 300 Operable X 6/9/15 1-2-20 11/102015 Approved Yes 200 Operable X Job completed successfully. Well has not flowed yet. 1125/15 P2 -09i 9222015 Approved Yes 100 Operable X Required 2nd remedial IA squeeze 325/16 10/5/15 4/13/16 14-27i 8282015 Approved Yes 150 Operable X X 9/18/15 07-03 12/8/15 Approved Yes 300 Operable X 1/8/16 BPXA request for approval of a proposed 2017 PBU sundry matrix for well work operations 30 November 2016 Page 18 05-39 11/20/15 Approved `(es 150 Operable X 11/25/15 04-43i 3/28/16 Approved `(es 100 In progress X X Pending AA submittal and approval 4/13/16 05-06 2/24/16 Approved `res 205 In progress X X CTD sidetrack prep 3/9/16 13-06 5/4/15 Approved "es 130 In progress X Shallow PC leak (IXO). Waiting on AA submittal/Approval 3/28/16 6/30/16 4/15/16 NK -20 N/A No Sundry "es 120 Operable X Job completed successfully. Well has not flowed yet required G-08 7/26/16 Approved \'es Unknown Not X X CTD sidetrack prep. tat IA cement jobs done w/8.8# lite 8/10/16 Operable In cement. Sidetrack cancelled due to economics. progress P1-21 5/9/16 Approved )7es 150 Not X 7/14/16 9/28/16 Operable In 7/21/16 progress 8/28/16 M-13 5/4/16 On hold Yes 120 Not X X 7/14/16 pending Operable 7/21/16 hearing 9/8/16 B-31 5/11/16 On hold Yes 150 Not X 7/17/16 pending Operable 7/27/16 hearing 0-06 4/11/16 7/15/16 n hold pending pending Yes 235 Operable X X CTD sidetrack prep. PC Leak -2000' MD. Have to bring 7/20/16 hearing cement in IA to no less than -1000' MD to accomplish objective of PC leak repair. Y-24 10/16 On hold Yes 30 Not X pending Operable hearing BPXA request for approval of a proposed 2017 PBU sundry matrix for well work operations 30 November 2016 Page 19 G-11 9/27/16 On hold Yes 44 Not X pending Operable hearing E-07 5/26/16 On hold Yes 192 Not X Surface casing leak; proposed to cement IA to 500' MD first 7/25/16 pending Operable then perforate ® — 1800' MD and OA up squeeze; pre CTD. hearing Attempting less desirable OA down squeeze at this time. PT pending cement cure. 15-48 10/4/16 On hold Yes 60 Not X X pending Operable hearing P1-04 10/14/16 On hold Yes 230 Not X X pending Operable hearing 5-22 Not Yes 125 Operable X No Integrity issues. Packer squeeze across Kuparuk to isolate submitted Kuparuk and then ad -pert to allow commingled yet pending Kuparuk/lvishak injection. hearing C-31 10/16 Was on hold Yes 500 Operable X No Integrity issues. Packer squeeze with 500' of cement to pending allow dual -string CTD exit. Re -submitted with cement below hearing; re- production packer to allow dual string exit. Cement job more submitted challenging this way and with more risk of failure without cement above packerand approved. L2-24 Not Yes 90o Operable X No Integrity issues. Packer squeeze with 500' of cement to submitted allow dual -string CTD exit above production packer, yet pending hearing BPXA request for approval of a proposed 2017 PBU sundry matrix for well work operations 30 November 2016 Page I 10 04-41 BOPD Not Yes 100 Operable X 3586 No Integrity issues. Packer squeeze with —1000' of cement submitted to isolate zones for perforations in a shallower formation yet pending (above production packer). hearing 1-2-21 Not Yes 900 Operable X Packer squeeze performed previously. Would like to sidetrack submitted well through IA cement above production packer (similar to yet pending L2-24 above) hearing Totals 31 Wells 6901 Summary of well work impacts BOPD Completed Wells 2610 In Progress Wells 705 13 Wells waiting on Sundry Approval 3586