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5/21/03 ConservOrdCvrPg.wpd
STATE OF ALASKA
DEPARTMENT OF NATURAL RESOURCES
DIVISION OF OIL AND GAS
Alaska Oil and Gas Conservation Committee
3001 Porcupine Drive
Anchorage, Alaska 99504
Re: THE MOTION OF THE ALASKA
OIL AND GAS CONSERVATION COMMITTEE
to hold a hearing to consider
issuance of an order or orders,
effective July 1, 1972, restricting
the flaring or venting of casinghead
gas from the referenced oil pools
to the amount required for safety
Conservation Order No. 103
Trading Bay Field
Middle Kenai "B", "C", "D",
and "E" Oil Pools
Hemlock Oil Pool
"G" NE Oil Pool
Hemlock NE Oil Pool
June 30, 19 71
IT APPEARING THAT:
1. The Oil and Gas Conservation Committee published a notice of public
hearing in the Anchorage Daily News on April 24, 1971, pursuant to Title 11,
Alaska Administrative Code, Section 2009.
2. A public hearing was held on May 27, 1971 in the City Council Chambers
of the Z. J. Loussac Library, 5th Avenue and F Street, Anchorage, Alaska,
at which time operators, subpoenaed witnesses, and affected and interested
parties were heard. The hearing record was held open through June 4, 1971 and
additional information was received.
3. Conservation Order No. 100, permitting the flaring of casinghead gas in
excess of the maximum amount that can be beneficially utilized, expires June
30, 1971.
FINDINGS:
1. There is a growing shortage of natural gas in the contiguous 48 states and
Hawaii, and natural gas is being sold at increasingly higher prices in both
intrastate and interstate markets.
2. There are increasing needs for natural gas in the village of Tyonek and
Greater Anchorage Area and Kenai Peninsula Boroughs, on both interruptible
and uninterruptible bases. Specific needs are those of the Native Village
of Tyonek, Inc., Chugach Electric Association, Inc., the City of Anchorage
Municipal Light and Power Department, and Alaska Public Service Corporation.
3. Alaskan gas is being exported to Japan, and there are potential markets
for Alaskan gas in the contiguous 48 states and Hawaii.
4. The Jones Act has impeded utilization of Alaskan gas elsewhere in the
United States.
5. Substantially all fuel requirements on the oil-producing platforms of
the Trading Bay Field are now met by casinghead gas.
Conservation Order No. 103
Page 2
June 30, 1971
6. The casinghead gas and the entrained liquids now being flared could be
beneficially utilized. There are uses for interruptible casinghead gas, and
alternative fuels exist in the event the supply of gas .is interrupted.
7. The Oil and Gas Conservation Committee has been concerned with the
flaring of casinghead gas from the referenced field since 1967 and has held
several public hearings to determine the progress of eliminating gas flaring
in excess of the amount beneficially used.
8. During 1970, 5,906,523,000 cubic feet, or 85% of the gas produced from
the Trading Bay Oil Field was flared.
9. There was insufficient testimony as to the minimum amount of gas necessary
for a safety flare.
10. Restricting the flaring or venting of casinghead gas produced from each
of the three platforms in the referenced field to a volume necessary for an
adequate safety flare will conserve gas.
11. Expert opinions differ as to the effect on ultimate recovery of a
restriction in the rate of production or injection under a fluid injection
project, but it is not proven that any such restriction will reduce ultimate
recovery from 'the referenced pools and thereby cause waste. A fluid injection
project is in operation in the Trading Bay Field.
CONCLUSIONS:
1. One year is a reasonable period of time in which to complete arrangements
for use of excess casinghead gas currently being flared.
2. Except in cases of emergency, the flaring or venting of gas after 7:00 A.M.,
ADST, July 1, 1972 in excess of the amount required for safety will constitute
waste as waste is defined in AS 31.05.170(11).
3. A hearing is required to determine the amount of gas necessary for
adequate safety flares.
NOW, THEREFORE, IT IS ORDERED THAT:
1. Casinghead gas in excess of the maximum amount that can be beneficially
utilized may be flared until 7:00 A.M., ADST, July 1, 1972.
2. Effective at 7:00 A.M., ADST, July 1, 1972, the flaring or venting of
casinghead gas from the Trading Bay Field is prohibited, except for
the amount necessary for adequate safety flares and except in emergencies.
Conservation Order No. 103
Page 3
June 30, 1971
3. The commencement, nature and termination of all emergencies requiring
flaring of casinghead gas in excess of the amount required for safety flares
shall be reported to the Committee within 96 hours after occurrence.
DONE at Anchorage, Alaska, and dated June 30, 1971.
Homer 'Chairman
~ L. Burrell,
Alaska Oil and Gas Conservation Committee
O. K'. Gilbi~e~b, ~r'., Membe~
Alaska Oil and Gas Conservation Committee
STATE OF ALASKA
DEPARTMENT OF NATURAL RESOURCES
DIVISION OF OIL AND GAS
Alaska Oil and Gas Conservation Committee
3001 Porcupine Drive
Anchorage, Alaska 99504
Re: THE APPLICATION OF UN ION OIL )
COMPANY OF CALl FORNIA AND ATLANTIC )
RICHFIELD COMPANY for an order amend-)
lng Rule No. 2 of Conservation Order )
No. 103 by deleting the date ~July I,)
1972'' and substituting the date )
"November I, 1972". )
)
)
)
Conservation Order No. 103-A
Trading Bay Field
Middle Kenai "B", "C", "D", and
"E" Oil Pools
Hem lock Oil Pool
"G" NE Oil Pool
Hemlock NE Oil Pool
June 8, 1972
IT APPEARING THAT:
I. The Oil and Gas Conservation Committee published a notice of public
hearing in the Anchorage Daily News on April 14, 1972, pursuant to Title !1,
Alaska Administrative Code, Section 2009.
2. A public hearing was held May II, 1972 in the City Council Chambers
of the Z. J. Loussac Library, 5th Avenue and F Street, Anchorage, Alaska,
at which time operators and affected parties were heard.
FINDINGS:
I. Immediately following issuance of Conservation Order No. 103, operators
and affected parties commenced studies to determine a beneficial use or
uses of the excess casinghead gas being flared.
2. Following determination of beneficial uses of the excess casinghead
gas being flared, engineering and design studies were undertaken and equip-
ment and construction contracts were entered into.
3. All of the foregoing was accomplished with due diligence, but was
delayed owing to necessary engineering and design time, seasonal weather
conditions, and construction'an'd delivery time of specially-designed equipment.
CONCLUSIONS:
I. Operators of the referenced pools and affected parties have made a bona
fide effort to comply with Conservation Order No. 103, but compliance will
be delayed by conditions beyond their control.
Conservation Order No. 103-A
Page 2
June 8, 1972
2. Compliance with Conservation Order No. 103 can be expected by October
15, 1972.
3. The dates in Rule Nos. I and 2 of Conservation Order No. 103 should
be changed to the earliest practicable date which is reasonable, but not
beyond such date.
NOW, THEREFORE, IT IS ORDERED THAT:
I. Rule No. I of Conservation Order No. 103 is amended to read as follows:
~Casinghead gas in excess of the maximum amount that can be beneficially
utilized may be flared until 7:00 A. M., ADST, October 15, 1972.'~
2. Rule No. 2 of Conservation Order No. 103 is amended to read as follows:
"Effective at 7:00 A. M., ADST, October 15, 1972, the flaring or venting
of casinghead gas from the Trading Bay Field is prohibited, except for
the amount necessary for adequate safety flares and except in emergencies.~
3. The Oil and Gas Conservation Committee, by administrative order or
orders, may extend the date provided for in Rule Nos. I and 2 of this order.
No such order or orders may extend the date beyond 7:00 A. M., ADST, November I,.
1972, except pursuant to Title II, Alaska Administrative Code, Section 2012.
DONE at Anchorage, Alaska, and dated June 8~ 1972.
Thomas R Marsh ............ '.r..'. ..... · .....
all, Jr , Execut.ve Secretary
Alaska Oil and Gas Conservation Committee
Concur re n ce:
Ho er L Burroll, Chairman
Alaska Oil and Gas Conservation Committee
Alaska Oil and Gas Conservation Committee
October I0, 1972
ALASKA OIL AND GAS CONSERVATIOLI COI'?,!',IlTTEE
Re: Administrative Decision No. 103-A.I
Trading Bay Field
F~iddle Kenai ~B:~, ~C:~', ~'D~',
and ~E~ 0il Pools
Hemlock Oil Pool
~'G~? N.E. 0il Pool
Item lock N, E. 0 i I Pool
~tr. Wade S. ~IcAIlster
Union Oil Company of California
909 W. 9th Avenue
Anchorage, Alaska 99501
Dear ~4r. ~-IcAlister:
Pursuant to Order No. 3 of Conservation Order No. 103, the Oil and Gas
Conservation Committee hereby further amends Rule Ho. I and Rule No. 2
of Conservation Order No. 103 to read as follows:
Rule No. I t~Casinghead gas in excess of the maximum amount that can
be beneficially utilized may be flared no later than
7:00 A. ~..~., AST, November I, 1972.~?
Rule No. 2 '~Effecfi'ive no later than 7:00 A. M., AST, November I,
1972, the flaring or venting of casing head gas from
the Trading Bay Field is prohibited, except for
the amount necessary for adequate safety flares and
except in emergencies. ~?
Unforseen manufacturing and shipping difficulties affecting fifteen
valves and valve gear operating mechanisms have resulted in an unavo~.it]-
able delay in the line beco~ning operat,~l.f/~ ~(~~-"~"J~~ .-~--- ~/~ ~/~_~,I
Thomas R. Marshall, Jr. Executive Secretary
Alaska Oil and Gas Conservation Committee
Concurrence:
Alaska Oil and Gas Conservation Committee
Alaska ()il and Gas Conservation Committee
INVENTORY
CO;-ISERVATION ORDER // 103
(Restricts flowing in Trading
Bay Field after July I, 1972)
iTEM
,, ,
I. Inventory
2. C.O. #103
3. Affidavit of publication
5,
Notice of publication
Alaska Oil and Gas Conservation Committee
Exhibit ~i: Trading Bay Field, oil and gas production,
January 1967 through March 1971
6. Exhibit 2:
7,
9,
12.
13.
14.
15.
Trading Bay Field
Calculated value of gas flared
Exhibit #3: Alaska Pipeline Company
Annual sales history and forecast
Atlantic Richfield Company
Exhibi~t #1: Trading Bay Field
Location of "G" and Hemlock N.E. Pools
Exhibit t/2: Platform Spark operation - primary prediction
Exhibit #3: Platform Spark and Texaco - Superior Platform "A" -
Unitized operation
Union Oil Company of California '
Exhibit #1: Trading Bay Field, produced,§as and gas
beneficially used
Exhibit #2: Trading Bay Field, structure contour map,
Top C-7 sand
Exhibit //3: Trading Bay Field, cross-section showing "C"
Pools, I IA fault block, through wells A-24
A-19, .A-16, A-8, and A-2
Exhibit #4: Permeability variatiOn~ from sandstone cores and
sidewall samples, Middle Kenai and Hemlock formations,
Trading Bay Field
Exhibit #5: Mobitity ratios, Trading Bay Field
ITEM I
Conservation Orde~'~ lie No. 103
InvenTory of Exhibit.~
Page 2
16.
17.
25.
26.
Exhibit /.16: Beneficial use of gas, Tradi'n.q Bay Field
Exhibit #7: Letter, B. R. Brown, Atlantic Richfield Co., to
Union Oil Company of California, Re: Gas
Supply C;~tra~t~ dat~.cJ Mar~.h 2. 1071,
Copies of prepared testimony of Atlantic Richfield Company,,
Texaco, Inc. - The Superior Oil Company, and Union Oil Company of
Ca I i fornia.
Subpoenas to:
18. James R. Hendershot, dated May 21, 1971
19. Reggie Elkins, dated May 21, 1971
20. Robert E. Sharp, dated Hay 21, 1971
21. L. J. Schultz, dated May 21, 1971
22. Lynn P. Bartlett, dated May 21, 1971
23. Dale Teel, dated May 24, 1971
24. John Berquist, dated May 27, 1971
Exhibits timely filed following public hear~ing:
Letter from J. R. Scott, Atlantic Richfield Co. to
T. R. Marshall, Jr., dated June 2, 1971, with attached
letter agreements for gas sales between Arco (signed by
B. R. Brown) and Mobil Oil Corp. (signed by R. J. Rohloff
and between Arco, Signed by B. R. Brown) and Union Oil
Co. of California (signed by R. Anderson) dated March 2, 1971 and
a gas analysis report on gas sample from the Granite
Point field.
Letter from V. A. Isaacs, Jr., Union Oil Co. of California
to Alaska Oil and Gas Conservation Committee re: Trading
Bay Field Conservation File #103, dated June I, 1971.
Exhibits fi led in Conservation File No. 105 and made a part of
the record of Conservation File 103 by reference, 'include City
of Anchorage Exhibit A (invitation to bid for gas service)
testimony of t~h'e subpoened witnesses, statements from th~ Alaska
Conservation 5ociety and the Sierra Club, and gas sales
correspondence of Dale Teel, Anchorage Natural Gas Corp 'c~
Union Oil and G.~s Division' Western Region
Union Oil Com~"._,' ~y of California
909 W. 9th Avenue, Anchorage, Alaska 99501
Telephone: (907) 279-7681
C. GEO£ -r?-
c ~N'~---~
3 ENG _,L__
....... ~NG
October 6, 1972 ;-f_-./_-j;;oEOty-
r' I · ~ G*°~- I
State of Alaska [._,
.... ate .....
Oil & Gas Conservation Committe~_~.N_~E_~_; I ]
3001 Porcupine Drive
___J
Anchorage, Alaska 99504
Re.
CONSERVATION ORDERS
103 A and 104 A
Application of Extension
Gentlemen:
Reference is made to Conservation Orders affecting the flaring of casinghead
gas in Cook Inlet, State of Alaska in.requiring such flaring ceased by October
.15, 1972. Operators and' affected :parties have made a bona fide attempt to
comply with the above mentioned Conservation Orders. Pipelines have been
constructed for the delivery of casinghead gas to onshore facilities and this
pipeline and. related facilities and equipment are near completion.
Several major components for the 10" and 16" gas pipelines and facilities from
East Foreland to the Nikiski Area were up to six weeks late arriving in Alaska due
to manufacturing and shipping difficulties. Fifteen valves critical to. the final
stallation of the two pipeline systems, were approximately three months late-
arriving in late September.
The late shipment caused several days delay in final pressure testing and clean-
ing of these pipelines. The gear operators, shipped separately and needed in
order to open and close these valves, arrived in late September and.were discovered
to be the wrong size. The manufacturer was immediately notified and instructed to
expedite delivery on two correct size operators and air freight them to Alaska. In
addition, all available sources of these operators have been investigated.
At the present time, a date of October 9 or 10 is the earliest possible shipment to
Alaska (from St. Louis, Mo.). Efforts are continuing in an attempt to improve de-
livery. Several days of purging the pipelines with natural' gas will be required in
State of Alaska ( -2-
Oil & Gas Conservation Committee
Application of Extension, Conservation Orders
October 6, 1972
order to reduce water content of the gas to market specifications, thus meeting
the October 15 "no flare" deadline will not be possible.
Due to circumstances beyond the control of the parties constructing said pipelines,
certain items of vital, indispensable equipment are not presently available and is
contemplated that this lack of availability of required equipment will delay opera-
tion of said pipeline beyond the date of October 15, 1972. Additional documenta-
tion of this fact is available if required.
Application is hereby made for an extension of the implementation of the no flare
order previously ordered for October 15, 1972, to be extended to November 1, 1972.
It is the intention of the operators and the affected parties to comply with the above
referred to Conservation Orders as soon as equipment now lacking has been installed
and construction completed on said pipeline. In the event the line becomes opera-
tional before the requested extension date of November 1, 1972, the line will be put
into operation at the earliest possible date. Should your committee require any
additional information or evidence to Process this application for extention, we will
make such information available on notice. Your Committee will be notified when
said pipelines go into operation.
Very truly yours,
UNION OIL COMPANY OF CALIFORNIA
MARATHON OIL COMPANY
By:
TRADING BAY FTELD HEARING
MAY ll, 1972
ATLANTIC RICHFIELD COMPANY
EXHIBITS
/~
9
PLATFORM ~ I -~NTBU PRODUCTIVE
"A" ~" } ~ LIMITS
/
/
t
/
/
/
/
/
/
/
/
/
/
/
"MONOPOD"
G,R'z~,,'¥/TE' PT
OA,'$,HORE F,~C/L/ TI£S
/
I
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EXHIBIT I
AtlanticRichfieldCompany
TRADING BAY FIELD HEARING
MAY II, 1972
LOCATION MAP
¢.o.
o(-.f-,,, Co¢'1
PLATFORM "A"
ii
SAFETY PILOT
400 Mcf/D
FORMAT. iON GAS 1080 M cf/D
,,
FUEL
500 M cf/D .
TO SHORE
150 M cf / D
PLATFORM SPARK
SAFETY PI LOT
600 Mcf?D
FORMATI ON GAS
1500 Mcf/D
/
FUEL
I400 Mcf/D
500 Mcf/D
EXHIBIT 2
AtlanticRichfieldCompany. '~'~,
TRADING BAY FIELD HEARING
.MAY i i,1972
PLATFORMS /3, (]nd SPARK
GAS AVAILABILITY ('.0 IO'~.A
NIKOLAI WELL N°3
(Limi ted Emergency Fuel )
ON- SHORE FACILITIES
.4;50 Mcf/D
2.50 Mcf/D
GAS FROM
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AllanticRichfioldCCpany O
~A~NO BAY ~D HEARIN6
MAY II, 1972
PRODUCTION HISTORY 1971 WELL S -2
oc'roo[l~ .,)vi M,)['n. nfcl unl n
IO0
60 ¢
40 ~
~ '/~ /' AI.~KA CONSERVATION sOcIETY
~ t KENAi PENfhlSULA CHAPTER
::/./.~ ~ .::Q~&~ A~S~ 99669
Division of Oil and Gas
5001 Porcupine Drive
Anchorage, Alaska
DIVISION OF OIL AND G.',/;
ANCHO~.,tC~
.
RE' Request for delay on termination of Cook Inlet offshore flaring
This organization would oppose a delay in termination of offshore
flaring for the following reasons'
1. 'Continued flaring provides obvious air pollution which can be
seen from Kenai. almost any day as a low-lying cloud of black (the
evening of 4/25/72, it looked yellow-greenish) smoke over the Inlet.
&
2. The flaring of the offshore casinghead gas is a waste of a
resource.
3. The additional wasting of the resource should not be permitted
to continue .... lest it make the installation 'of another LNG plant
or other such type of gas reprocessing for trans-shipment less
economically feasible. Does not the fact that the proposed plant
under consideration by Pacific Electric Service Co. contradict the
earlier statements regarding lack of feasibility for the usage ,of
the gas from the offshore platforms?
4. Even if it may be essential to extend the deadline, this
organization recommends that it be done on a month-to-month basis
with the review.required for continuing extensions of an additional
'month, - ~,,~ .,
JA~S E. FISHER
P~sident
P, S, The Pipe coating is not beih is a
g accompl hed in A1 ska for'the
project, Is the lack of the 60-80 jobs involved in the required
pipe coating considered by this Division in its.':de.l~berations over the
· delay in gas flaring termination deadline? . .
·
¢,/- -5 -
,
TRADING BAY'FIELD 'HEARING
MAY ll, 197'2
ATLANTIc RICHFIELD. COMPANy
TESTIMONY AND EXHIBITS I-
' ~Z'.O. i~.~--A ·
ENGINEERING TESTIMONY
ATLANTIC RICHFIELD COMPANY
ALASKA OIL AND GAS' CONSERVATION CO~ITTEE HEARING
TRADING BAY FIELD--CONSERVATION ORDER NO. 103
MAY 11, 1972
Atlantic Richfield Company operates Platforms "A" and Spark in~ the
Trading Bay Field. E~ibit 1 shows the location of these platforms in
relation to the other platforms in the field, the outline of the unitized
"G" and Hemlock Northeast Oil Pool productive limits, and the Granite Point
onshore production facilities. Conservation Order No. 103 ~applies to the
operation of these platform and requires that effective July 1, 1972, the
flaring or venting of casinghead gas from the Trading Bay Field is prohibited
except for the amount necessary for adequate safety flares and except in
emergencies.
Platforms Spark and "A" do 'not produce enough casinghead gas to meet their
combined fuel requirements. EzR~ibit 2 shows casinghead gas availability
and usage for these platforms under a minimum flare condition. The diagram
also shows a gas balance bet~een these platforms,.' onshore fuel' requirements,
and an outside makeup fuel gas supply. Equipment is available on the platforms
for this type of operation. On Platform "A", some minor changes in piping
will be required and an existing dehydrator must be put into operation before
gas can be delivered to shore on a reliable basis.' We expect Platform "A"
to ~e operating under minimum safety pilot conditions by July 1, 1972. Out-
side requirements for fuel are normally met by the purchase of excess
casinghead gas from the Mobil-operated Granite Point platform. As I will show
later, this source of fuel has been interruptible. Under emergency conditions,
a limite~ amount of fuel is also available from Texaco's Nicolai No. 3 well
for Platform "A" or onshore fuel requirements.
-2-
Platform Spark is essentially a totally electric-powered platform and
generates its own power. It has two 3500 KW generators driven by 5000
HP Nordberg turbines. At the present time, one generator operating at
95 percent of its peak capacity is providing all platform electric power.
The other turbine-driven generator is normally not operated and serves
only as a standby. As shown on the diagram, fuel requirements when oper-
ating with one turbine are 1400 MCFPD. Under the conditions shown, only
900 MCFPD of casinghead gas produced on the platform is available for fuel.
This means that 500 MCFPD of casinghead gas must come from shore to meet
platform fuel requirements. Without an outside fuel supply or when this
service is interrupted, there is not sufficient fuel gas for the Nordberg
turbine. It then becomes necessary to convert part of our operations to
diesel fuel and flare more of the produced casinghead gas. Nordberg turbines
on Platform Spark can use either gas or diesel, but they cannot use a corn-
bination of these fuels. Conversion from one fuel source to another requires
a shutdown of approximately four to six hours and causes a substantial risk
of turbine damage due to the temperature changes during shutdown and startup.
As already indicated, Atlantic Richfield Company has entered into contracts
with Mobil and Union to purchase sufficient casinghead gas· from their Granite
Point field operations to combine with oUr gas. production and meet our fuel
needs. The contract pressure for delivery of this gas is 250 psig. Exhibit
3 shows the amount and pressure of this gas delivered to our· Granite Point
onshore facilities for subsequent use there .and on PlatfOrm Spark. The
, ,
exhibit supports my previous statement that the service has been interrup-
tible. MobiI does have equipment on order to provide gas at contract pressure
and. to help alleviate some of the problems. However, even with the planned
modifications, the interruptibility will not be completely eliminated. To
-3-
ensure a dependable fuel gas supply, we are negotiating an exchange
of gas with Union and Marathon that will enable us to obtain gas
from the pipeline system currently being constructed from the .Trading Bay
onshore production facilities to the North Kenai area as a backup 'for the
other sources. With this backup supply, we will be able to consistently
utilize all excess casinghead gas produced on Platforms "A" and Spark as
fuel.
Curtailment of production to prevent flaring of excess casinghead gas until
a reliable supplemental fuel gas source is developed would impose a signif-
icant risk on future performance and recovery of wells now prodUcing in this
field. This conclusion is primarily based on the performance of'wells on
Plat.form Spark following a. shutdown due to equipment failure in June, 1971.
Exhibit 4 shows rate performance of well S'2 for a period of time prior to
the June, 1971 shutdown and during subsequent attempts to return the well
to oil production. Prior to the shutdown, the well produced at an average
rate of about 600 BOPD with a water cut averaging about 45 percent. Its
production since the shutdown has been essentially 100 percent water. Other
wells also suffered a loss in oil productivity and a corresponding increase
in water cut as a result of the shutdown but subsequently recovered. The
explanation of this performance may be cross flow in the well bores. The'
water-wet intervals in producing wells in this reservoir are probably more
affected by the limited water drive and have a slightly higher pressure than
those producing oil. With a shut-in or limited drawdown situation, water
could cr~ss flow from the' water bearing interVals in the well and cause high
water saturations in the oil bearing formation around the Well bore. This
would seriously reduce the relatively permeability~ to oil. If any well is
lost prematurely in the reservoir, undoubtedly the recovery from the reservoir
will be adversely affected.
In summary, i have'shown that Platforms "A" and spark do not produce enough
casinghead gas to meet their combined fuel requirements. An outside Source
of fuel has been obtained, and our flares are often restricted to minimum
safety pilots now. However, the oUtside fuel source is interruptible and a
backup supply is needed to be able. to consistently comply with the order
without production curtailment. We expect the pipeline system currently
being constructed from the Trading Bay onshore production facility to the
North Kenai area to supply this needed backup fuel. Since this pipeline
cannot be in operation until November 1; 1972, we believe the request ~
for the extension of the' effective date for 'prohibiting the flaring or
venting of casinghead gas from Trading Bay Field except for ~the amount
necessary for adequate safety flares and except in emergencies to
November 1, 1972, is reasonable. We respectfully.request your consideration
of this extension. ~
That concludes my direct testimony. Thank you.
"SPARK"
--'""- NTB U PRODUCTIVE
LIMITS
"MONOPOD"
GR~,.¥/?E' PS
I
I
/
/
/
EXHIBIT I
AtlanticRichfieldCompany
TRADING BAY FIELD HEARING
MAY il, 1972
LOCATION MAP
PLATFORM "A"
ii
SAFETY PILOT
400 Mcf/D
FORMA?~ON GAS 1
1080 M cf/D
FUEL
500 M cf/D
PLATFORM SPARK
SAFETY Pi LOT
600 Mcf/D
FORMATI ON GAS
1500 Mcf/D
/
FUEL
1400 Mcf/D
--
TO SHORE
180 Mcf/D
500 Mcf/D
EXHIBIT 2
AtlanticRichfieldCompany
TRADING BAY FIELD HEARING
· MAY I i,1972
PLATFORMS A (]nd SPARK
GAS AVA! LABILITY
NIKOLAI WELL N°:3
(Limi ted Emergency Fuel )
ON-SHORE FACILITIES
~ .430 M cf/D
2.50 Mcf/D
'~ ..~OMcf/D
JANUARY FEBRUARY MARCH APR}L MAY JUNE JULY
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: ,. ~.. .............. .. ..... . ~--,, -.- ; ..-r" ,,~, -: ....... ~ ............ ~ .... . ........... i" ' ~ .... TRADING BAY FIELD HEARING 40
l:' " I I : ~ ] ~ ' l ~ I [ ..... : ~l~l''''~lJ '[1 I [ I I I .... I I I ~/]; ~ . i : . i i ! : t; · : · · ! · I - MAY II, 1972 .
, ; ! :.Z...~. : -.~ : . , . .. . . · .... PRODUCTION HISTORY 1971
:~ ......... i · · · ~ · .-4 .... i ................ ! ..... ~l ................... ; ............. :'"': ....... I ........ '. .......... 20
sill :, · ....;,:~/'i :,i i i I I : ': !. : .~.. i ~. , i · [ : ~' T~ we:_:_
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JANUARY
MARCH APRIL #AY JUNE JULY AUGUST SEPT£MBIR OCTOBER t~OVL~at~[ R DICE mCR
OF
STATE OF ALASKA, )
THIRD JUDICIAL DISTRICT, ) ss.
....... a--'?,~...L,..,-, h a k.e. ....................
being first duly sworn on oath
she
deposes and says that ...............
is the .... ~.e.L::.a...1....C..l..e..K.k. ..... of the
Anchorage News, a daily news-
paper. That said newspaper has
been approved as a legal news-
paper by the Third Judicial Court,
Anchorage, Alaska, and it is now
and has been published in the
English language continually as
a daily newspaper in Anchorage,
Alaska, and it is now and during
all of said time was printed in an
office maintained at the aforesaid
place of publication of said news-
paper. That the annexed is a true
copy of a ..~.e.E.a..1. ...... ' .... ~.o...t.~..c..e. 1930
as it was published in regular
issues (and not in supplemental
form) of said newspaper for. a
period of ..... .o. ~.e.. ...... insertions,
commencing on the .].~ .... day
of ...B.p.~.;L1 ........... ,19 ?.~., and
ending on the ...... ~ ........day of
f .~pr. il .................. , 19...72.,
otb dates inclusive, and that
such newspaper was regularly
distributed to its subscribers dur-
ing all of sa,id period. That the
full amount of the fee charged
.for the foregoing publication is
the sum of $ 12.50 which
amount has been paid in full at
the rate of 25¢ per line; Mini-
mum charge $7.50. ~ x~/
/.. ,x..,z.~ ×-.~ .... ,4:.. ~.~.~.. :_--~...-~... ~,, ~-,...~r:'T,~
Subscribed {sa~:J sworn to before
me this .lh:~. day of..~pz'J.1 .......,
19 7;2"
........... ....... :. ,,.:..
,4 .' . ~ · ..
J~ -" * "t Il'. 4,: ~, ;,'~ e",',J
NOTICE OF PUBLIC HEARING
STATE OF ALASKA
DEPARTMENT OF NATURAL RESOURCES
Alaska Oil and Gas Consarvati0n Committee
Conservation File Nos. 102, 103, 104 and
105
Re: The application of Union 0il Company
of California, Atlantic Richfialci Com-
pany, Shell 0il Company, and Amoco
Production Company for ordara amend-
ing Rule No. 2 of Conservation 0rdar
Nos. 102, 103, 104 and 105 by delet-
Ing the date "July 1, 1972" and eub-
stituting in its place the data "Novem-
ber 1, 1972."
Notice is hereby given that the refer-
enced companies have requested the Oil and
Gas Conservation Committee to issue ordera
which extend fha period of time from
July 1, 1972 to November 1, 1972, during
which casinghead oas in addition to the
amount necessary for safety can ba flared
from the oil pools identified in the refer-
enced conservation orders covering the fol-
lowing fields: Granite Point, Trading 847,
McArti~ur River, end Middle Ground Shoal.
The hearing will be held et 9:00 a.m.,
May 11, 1972, in the City Council Cl~am-
bars of the Z.J. Loussac Library, 5th Ava-
'nue and F Street, Anchorage, Alaska, at
which time operators of the identified oil
pools and affected and interested parties,.
will be heard.
Thomas R. Marshall, Jr.
Executive Secretary
Alaska 0il and Gas Conservation
Committee
3001 Porcupine Drive
Anchorage, Alaska 99504 .
Publish: April 14, 1972
Legal Notice No. 1930
NOTICE OF PUBLIC HEARING
STATE OF ALASKA
DEPARTMENT OF NATURAL RESOUI~CES
Alaska Oil and Gas Conservation Committee
Conservation File Nos. 102, 103, 104 and
105
Re: The application of Union Oil Company
of California, Atlantic Richfield Com-
pany, Shell Oil Company, and Amoco
· Production Company for orders amend-
',,· lng Rule No. 2 'of Conservation Order
Nos. 102, 103, 104 and 105 by delet-
ing the date "July 1, 1972" end sub-
stituting in its place the date "Novem-
ber 1, 1972."
Notice is hereby given that the refer-
enced companies have requestec] the Oil end
Gas Conservation Committee to issue ordera
which extend the period Of time from
July 1, 1972 to November 1, 1972, durin~
which casinghead oas in addition to the
amount necessary for safety can be tiered
from the oil pools identified in the refer-
enced conservation orders covering the fol-
lowing fields: Granite Point, Trading Bey,
McArthur River, and Middle Ground Shoal.
The hearing, will ba held at 9:00 a.m.,
May 11, 1972, in the City Council Cham-
bers of the Z.J. Loussac Library, 5th Ave-
hue and F Street, Anch.orage, Alaska, at
which time operators of the Identified oil
pools end affected and Interested parti# '
will be heard.
Thomas R. Marshall~ Jr.
Executive Secretary
Alaska Oil end Gas Conservation
Committee
3001 Porcupine Drive
Anchorage, · Alaska 99504
Publish: April 14, 1972
Legal Notice No. 1930
NOTICE OF PUBLIC HEARING
STATE OF ALASKA
DEPARTMENT OF NATURAL RESOURCES
Alaska Oil and Gas Conservation Committee
Conservation Fi le Nos. 102, 103, 104 and 105
Re: The application of Union Oil Company of California, Atlantic Richfield
Coml~any, Shell 0II Company, and Amoco Production Company for orders
amending Rule No. 2 of Conservation Order Nos. 102, 103, 104 and 105
by deleting the date "July I, 1972" and substituting in its place the
date "November I, 1972".
Notice is hereby given that the referenced companies have requested
the Oil and Gas Conservation Committee to issue orders which extend the
laerlod of time from July I, 1972 to November I, 1972, during which casinghead
gas in addition to the amount necessary for safety can be flared from the oil
pools identified in the referenced conservation orders covering the following
fields: Granite Point, Trading Bay, McArthur River, and ~.iddle Ground Shoal.
The hearing will be held at 9:00 a.m., May II, 1972, in the City Council
Chambers of. the Z. J. Loussac Library, 5th Avenue and i~ Street, Anchorage,
Alaska, at which time operators of the identified oil oools and affected and
interested parties will be heard.
Thomas R. Marshall, Jr.
Executive Secretary
Alaska Oil and Gas Conservation Committee
3001 Porcupine Drive
Anchorage, Alaska 99504
Publish: April 14, 1972
Robert T. Anderson
District Land Manager
Gentlemen:
Union Oil and Gas D)'-ion: Western Region
Union Oil Company of¢C.'~lifornia
909 W. 9th Avenue, Anchorage, Alaska 99501
Telephone: (907) 279-7681
union
.April 7, 1972
State of Alaska
Oil & Gas Conservation Committee
3 001 Porcupine Drive
Anchorage, Alaska 99504
Re' CONSERVATION ORDER ~103-~
STATE OF ALASKA
Application of Extension
Union Oil Company of California, as Operator of the ~Tra~di~ng Bay Field,
__
,
requests Conservation Order ~I03, Order 2, be amended by deleting 'the
date "July 1, 1972" and substituting in its place the date "November 1,
1972."
Immediately'upon issuance of said Conservation Order Union and Marathon
Oil Company'jointly proceeded to design and construct a 52 mile pipeline
system to deliver excess casinghead gas from the Trading Bay Production
Facility West Foreland to the North Kenai Industrial Complex. Barring un-
foreseen, adverse circumstances causing delay, the requested amendment
will provide sufficient time to complete construction and insure the system
is operational thereby allowing compliance with the flare curtailment pro-
vision of said Order.
In the even'[ it is deemed necessary that a Public Hearing be held in 'this
matter, we respectfully request such hearing be held on May 10, 1972.
The 30 day notice period if required for such hearing is hereby waived. All
affected working interest owners in the Trading Bay Field have been advised
of this request.
AP8 ? 197
RTA/nr
Very truly yours,
.. AtlanticRichfieldCompany
North Am~' an Producing Division
Alaska Ex~,~ration & Producing Operations
Post Office Box 360
Anchorage, Alaska 99501
Telephone 907 277 5637
Ralph F. Cox
Resident Manager
April 7, 1972
State of Alaska
Oil & Gas Conservation Committee
3001 Porcupine Drive
Anchorage, Alaska
Subject: Application for Extension
Conservation Order No. 103
State of Alaska
Gentlemen'
Atlantic Richfield Company, as an operator in the Trading
Bay Field, requests the amendment of Order 2 of Conservation
Order No. 103 by deleting the ~date "July 1, 1972" and in
its place substituting the date "November 1, 1972".
Platforms Spark and 'W', operated by Atlantic Richfield
Company, do not produce enough casinghead gas to meet
their combined fuel requirements. A contract has been
entered into with Mobil and, Union to purchase sufficient
casinghead gas from their Granite Point Field operations
to combine with our gas production to meet these fuel
needs. This service has been very interruptable although
Mobil does have equipment on order to alleviate this
problem. When this service is interrupted, it is now
necessary to convert part of our operations to diesel fuel
and flare'part of the produced casinghead gas. To provide
a backup gas fuel supply, we are attempting to negotiate
an exchange of gas with Union and Marathon that will enable
us to obtain gas from the pipeline system currently being
constructed ~from the Trading Bay onshore productionfacility
to the North Kenai area. '~ne requested amendment is expected
to provide sufficient time for this system to become oper-
ational and allow compliance with the subject order.
0 197
D,i'"v?3tO,i~,I C)F OIL AND GAS
April 7, 1972 Page 2
In the event the Committee determines a hearing of this
matter is required, we request a waiver of the 30-day
notice and scheduling of the hearing on May 10, 1972.
Very truly yours,
Ralph F. Cox
P~C/vs
A?R 1 0 19~2
DIVISION OF OIL AND GA5
,,AtlanticRichfieldCompany Legal Divisio?
~ Post Office { 360
Anchorage, A~aska 99501
Telephone 907 277 5637
John R. Scott
Attorney
June 2, 1971
Alaska 0il & Gas Conservation Committee
3001 Porcupine Drive
Anchorage, Alaska 99501
Attention' Mr. Thomas R. Marshall, Jr.,
Executive Secretary
Subject' Conservation File No. 103
Gentlemen'
Submitted herewith are copies of'
(1) Gas Supply Letter Agreement dated
March 2, 1971, between Atlantic
Richfield Company and Mobil Oil
Oil Corporation,
(2) Gas Supply Letter Agreement dated
March 2, 1971, between Atlantic
Richfield Company and Union 0il
Company of California, and
(.3) Gas Analysis Report dated
February 13, 1971, by Chemical &
Geological Laboratories for
MoDil Oil Corporation.
The third item is based on a sample taken on Mobil's
platform at.the compressor inlet scrubber and not at
the onshore delivery point.
These items are submitted pursuant to your request at
the May 27 hearing with the cons
of both Mobil and Union.
Yours very truly,
~,.~i,~ /," ,. ' ~
J~¢d R. Scott
JRS:ly
CC:
-"'ALASKA OIL and (;AS !I
¢ONS,ERyATJ.ON C, OM~iT~EE , Il
~
Union Oil Company of California
Attention' Mr. E.F. Griffin, Operations Manager
¢.o. t~
Union Oil and Gas~,F",ision: Western Region
Union Oil Company of California
909 W. 9th Avenue, Anchorage, Alaska 99501
Telephone' (907) 279-7681
Iune 1I 1971
union
Gentlemen:
State of Alaska
Oil & Gas Conservation Committee
3001 Porcupine Drive
Anchorage, Alaska 99504
Re:
Trading Bay Field
Conservation File ~103
In accordance with the request of the Oil and Gas Conservation Com-
mittee at the Public Hearing held May 27, 1971, Union Oil Company
submits the following information'
Gas Cap Reserves "E" Pools
Fault Blk 2A
1.6 MMMCF
These are volumetric reserve estimates subject to change upon further
definition of these pools.
As per the committee's second request'
Cumulative Production
Plugged Back Reservoirs
Trading Bay Field, Cook Inlet, Alaska
Fault
Blocks
Pools
Wells Oil Gas Water
Nos. Bbls. MCF Bbls
3-A
3-A
3-A
4-A
Total
C A-4,7S 125,948 178,374
D A-7L 192,258 344,090
B&C A-3 55 0
Hemlock A-18L 152,441 1_8.5,150
470,702 707,614
263
1,083
0
.28,218
29,564
? .....
I--F t.S%. I
REV
CONFER:
State of Alaska -2- June 1, 19 71
Union Oil Company respectfully requests this letter be entered in
the record of said hearing.
Very tr~J;y yours, /
Union Oil Company of California
By: Vernon A. Isaacs, Jr.
Petroleum Engineer
VAI/mm
,,,,i!_i~' 3~ .... "~ :~7''
STATE OF ALASKA
DEPARTMENT OF NATURAL RESOURCES
DIVISION OF OIL AND GAS
Alaska Oil and Gas Conservation Committee
CONSERVATION ORDER NO. 103
Trading Bay Field
Middle Kenai "B" "C" "D" and "E" Oil Pools
"G" NE Oil Pool and Hemlock NE Oil Pool
Hemlock Oil Pool, ,
H~:.E A R I N G
May 27, 1971
PROCEEDINGS
MR. BURRELL: I'm Homer Burrell, we're here today to have a hearing in
connection with Conservation File No. 103. I'm going to have to leaf through
several subpoenas here to find the file. I shall read the notice of public
hearing regarding Conservation File No. 103. The subject is the Trading
Bay Field, Middle Kenai "B", "C", "D", and "E" Oil Pools, Hemlock Oil Pool,
"G" NE Oil Pool, and Hemlock NE Oil Pool.
The Alaska Oil and Gas Conservation Committee will hold a hearing pursnant
to Title 11, Alaska Administrative Code, Section 2009, to consider issuance
of an order or orders, effective July 1, 1972 restricting the flaring or
venting of casinghead gas from the referenced oil pools to the amount required
for safety.
The hearing will be held at 9:00 A. M.,~May 27, 1971 and so long there-
after as the hearing may be continued, in City Council Chambers of the Z. J.
Loussac Library, 5th Avenue and F Street, Anchorage, Alaska, at which time
operators of the referenced pools and affected and interested parties will
be heard.
Evidence will be sought as to, but not limited to, the following:
1. Can ~xcess casinghead gas be marketed, injected into any reservoir
or pool, or otherwise beneficially utilized by July 1, 19727
2. Will the flaring or venting of casinghead gas after June 30, 1972
in excess of the amount required for safety constitute waste, as
"waste" is defined in AS 31.05.170(11)?
3. Will more waste be caused than prevented by an order restricting
production of oil to a rate whereby all produced casinghead gas is
beneficially utilized or is required for a safety flare?
Signed by Thomas R. Marshall, Jr,, Executive Secretary of the Alaska Oil and
Gas Conservation Committee. Published in the Anchorage Daily News on April 24,
1971.
--2--
For introduction purposes this is Mr. Thomas R. Marshall, Jr., to my
left, Executive Secretary of the Committee and Chief Petroleum Geologist of
the Division of Oil and Gas; Mr. O. K. Gilbreth, Jr., member of the Committee
and Chief Petroleum Engineer of the Division of Oil and Gas. This is John
Levorsen, Petroleum Geologist; Mr. Gar Pessel, Petroleum Geologist; Mr. John
Miller, Petroleum Engineer; and Mr. Harry Kugler, Petroleum Geologist. To
my right are Bob Hartig and John Norman from the Attorney General's office.
Unless there is objection, I would like to ask that the record
incorporate testimony given on May 25, and the submittal by the Committee
on May 25 with respect to various articles, including those of Mr. Hollis M.
Dole, Assistant Secretary of Interior, articles from newspapers and oil and
gas publications, all of which went to indicate the general shortage of gas
in the "Lower 48" states. Without objection, we'll consider those as entered
into the record of this hearing.
Furthermore on the original hearing on May 25, Middle Ground Shoal Field,
Conservation File No. 105. At that time there was testimony introduced by
some six subpoened witnesses and the thrust of their testimony, I think that
most people are familiar with, and at that time it was stated that we requested
it then, that it would be entered into the record, and I would hereby' request
that unless there is objection that it be included in the record. Are the~e
any objections to that previous testimony? These people are all subject to
recall. We can bring them back if anybody objects or wants them back for cross
examination.. Does anybody have any objections to incorporation of previous
testimony from the six subpoened wit~essesinto the record or want them back
for cross examination? Without objection their testimony will be incorporated
-3-
and we will not recall unless we decide to later.
We have an additional witness under subpoena today. Mr. John Bergquist
of Pacific Lighting Service Co., and I would ask Mr. Bergquest at this time
if he would rather testify now or if he would rather wait. I don't want to
inconvenience his schedule. Since he's under subpoena, we'll give him the
opportunity to testify now if he prefers it.
MR. BERGQUEST: I prefer to wait.
MR. BURRELL: Thank you Mr. Bergquist. Since you're under subpoena we
simply didn't want to interfere with your schedule any more than was necessary.
Thank you sir.
Is there anybody who wishes to present testimony on the matter at hearing?
MR. SCOTT: This is John Scott, attorney with Atlantic Richfield Compamy.
We wish to present witness Bill C. Anderson, He is our district engineer for
the south Alaska district here in Alaska. Do you want to swear him in now,
Mr. Burrell?
MR. BURRELL: Yes. Mr. Marshall.
MR. MARSHALL: Please raise your right hand. In the matter n~w at hearing,
do you swear to tell the truth, the whole truth, and nothing but the truth,
so help you God?
MR. ANDERSON: I do.
MR. MARSHALL: Thank you.
MR. SCOTT: Mr. Anderson's qualifications are already on file with the
Committee and we would request that you accept them and incorporate them ........
MR. BURRELL: If there are not obJectinn.~ Mr. Ander.~n's aual~fic, tio~.$
ms a witness are accepted.
-4-
MR. ANDERSON: Thank you. Gentlemen, at the March 4, 1971 gas flare
hearing ~eld in Juneau, Atlantic Richfield presented testimony on the Trading
Bay Field "G" NE and Hemlock NE oil pools. Our Platform Spark derives all its
production from five wells commonly completed in these pools. At that hearing
we discussed the nature of the reservoir, our operation of Platform Spark,
amount of gas produced, our fuel requirements and the status of gas venting or
flaring. Texaco-Superior's Platform A also has five wells completed in the
"G" NE and Hemlock NE oil pools. In addition they have wells completed in the
Hemlock and Middle Kenai "B" and "E" pools. Since the March 4 hearing, Atlantic
Richfield, Texaco and Superior have reached agreement on unitization of the
"G" NE and Hemlock NE oil pools. The unit agreement has been submitted to
the State for their approval. Under the terms of the proposed unitization,
Atlantic Richfield will become operator of the Texaco-Superior Platform "A".
My testimony is prepared to first discuss the operation of Atlantic Rtchfield's
,,
Platform Spark projected on the basis of current operations without unitization.
Texaco's representative will discuss the operation of their platform under
primary depletion without unitization. I will then discuss the combined
operations of Platform Spark and Texaco-Superior's Platform "A" with waterflooding
of the "G" NE and HemlockNE oil pools as planned after unitization. I would
like to briefly review those factors of reservoir performance and platform
operations which strongly influence gas production and use. I will then direct
my testimony to the three specific questions set out in the call of the hearing.
First, I'll discuss Platform Spark and the manner used in its operation.
Atlantic Richfield operates Platform Spark. It is located on the eastern
side of the field. As already mentioned, its production comes from five wells
-5-
commonly completed in the "G" NE and Hemlock NE oil pools. Exhibit 1,
gentlemen, this slide and all slides that I'll present here today are identical
to the exhibits I have submitted for the record. Exhibit 1 shows the location
of this platform, the general outline of the pools and wells completed in the
pools. Atlantic Richfield's leases are shaded on the exhibit. The "G" NE
and Hemlock NE reservoir had an original pressure of about 4500 psi. This is
an undersaturated oil reservoir and based on PVT analysis has a solution gas/
oil ratio of about 250 cubic feet per barrel of oil. It has a relatively
small aquifer which provides a limited water drive. As a result of these factors
the reservoir pressure declines and producing capacity decreases with pressure.
Gas production decreases with the oil rate and will continue to do so until a
bubble point pressure of the reservoir oil is reached. The present reservoir
pressure is 2300 psi and the bubble point pressure of the oil is approximately
1750 psi. The average daily rate produced by wells on the Platform Spark was
about 3600 barrels of oil per day and 400 MCF per day of gas during April 1971.
The predicted gas producing rate of Platform Spark under the primary depletion
mechanism of continued non-unitized operations is shown in exhibit 2. The gas
producing rate is the solid line on the sraph.~ Platform Spark is essentially
a totally electric powered platform. However, it does generate its own electric
power. It has two 3500 kilowatt generators driven by 5000 horsepowered gas
powered boilers. These are used on the platform for heating. One boiler is
normally used and the other serves as a stand-by. Five producing wells are
artificially lifted by rotative gas lift system. That is, the gas is compressed
and re-injected over and over. A 2000 horsepower gas lift compressor is
driven by electric motors. There is also a 700 horsepower auxillory gas
-6-
lift compressor dirven by a gas fuel engine. Oil produced on Platform
Spark is piped ashore at Granite Point where gas-fired heater treaters are
used to remove the water. The oil is then delivered to the Cook Inlet Pipeline
Company and pumped to the Drift River Terminal. Associated gas produced with
the oil is used to the maximum extent possible for fuel. In the absence of a
gas.market any gas that cannot be used is flared. The normal fuel gas require-
ment for Platform Spark and associated onshore facilities are shown on exhibit
2, this is the dashed line on the exhibit. At present these requirements are
made up of 1100 MCF per day for the Nordburg turbine, 250 MCF per day for
the boiler on the platform, and 300 MCF per day for onshore facilities. This
gives a normal fuel gas requirement of 1650 MCF per day. Since we are producing
only 400 MCF per day,¥Platform Spark is deficient in supplying its own fuel
gas requirements. The boiler on the platform and our onshore facilities are
using gas as fuel, but there is not enough produced gas to supply the fuel
requirements of the Nordburg turbine. This.tur'bine is equipped to use either
gas or diesel, but the fuel requirements must be met by one or the other, not
a combination. In order to be able to use all the'gas produced on Platform
Spark we have signed an agreement with Mobil and Union to buy excess gas
from their Granite Point operation to supplement Platform Spark's gas production..
Work is now in progress to deliver this gas to the fuel system of Platform
Spark. As shown in exhibit 2, we expect to be deficient in supplying our
fuel gas needs for Platform Spark for as long as we continue to produce on
this non-unitized operation. This is depicted by the fuel gas requirement
....... . In regard to the three questions listed on the call of the hearing
I believe these are answered by the statement, that we expect there to be
-7-
no excess casinghead gas vented from Platform Spark after June 30, 1972.
As soon as gas from Mobil and Union can be used to supplement the t~rbine
generator fuel requirements, all casinghead gas produced on Platform Spark
will be beneficially utilized or required for a safety flare. That concludes
my testimony on operation of Platform Spark on a non-unitized basis. I
would like to discuss the unitized operation after Texaco pres~n~s~testimony
on operation of their platform "A" on a non-unitized basis. With your
approval I would like Mr. M¢Cann of Texaco to present his testimony on the
non-unitized operation of Texaco's Platform "A".
MR. BURRELL: Thank you Mr. Anderson. Unless there"is objection I
suggest taht we defer the questions on this platform operation to the conclusion
testimony.
MR. ANDERSON: Thank you sir.
MR. BURRELL: Thank you sir.
MR. MCCANN: My name is Leo M¢Cann, I have the position of Field Foreman
with Texacoe I have not established my qualifications before, but I have
a BS degree in Petroleum Engineering from Texas A & M. I worked the last 15
years as a Petroleum Engineer for Texaco, the last 2 years have been spent as
Field Foreman.
MR. BURRELL: Thank you Mr. McCann, without objections your qualif~c~t~on~
will be accepted as an expert witness. I'll ask Mr. Marshall to swear you in.
MR. MARSHALL: Please raise your right hand. In the matter now at hearing
do you swear to tell the truth, the whole truth and nothing but the truth, so
help you God?
MR. MCCANN: I do.
-8-
MR. MARSHALL: Thank you. You may be seated.
MR. BURRELL: Mr. McCann, we will ask that you just wait a second here.
In the course of my house-keeping operations I over-looked one thing. I
over-looked the Committee exhibits here and I ask Mr. John.Miller to enter
these into the records. I will ask Mr. John Miller to introduce these into the
record right now.
MR. MILLER: I will talk about pool break-down. Everybody can see the
numbers. For those who can't I'll read the field totals and I think that
will suffice. The Trading Bay, this exhibit is of the oil and gas production
including the gas utilized and flared as reported by the operators. Cumulative
production for the field is 26,029,000 barrels and this has a value of
63,040,000 dollars based on the payments for royalty oil to the State. The
cumulatiVe produced gas includes 853,829 MCF produced and flared dry gas as
reported. These figures are included in the Middle Kenai and field totals
and in the flared portion. Cumulative produced gas is 19,309,777 MCF; of
this 11% was utilized and 89% was flared. This chart is similar to those shown
yesterday and the day before. This is a break down of flared gas equated~
to equivalent barrels of oil~ The heating value of the gas is equated to
the heating value of Trading Bay oil and on this basis 5,674 cubic feet of
gas and equivalent to a barrel of Trading Bay Oil. Currently, that is, March,
gas flared was 15,712 MCF per day and this equated to oil on a BTU basis is
equivalent to 2,769 barrels of Trading Bay oil, and this oil then would have,
the equivalent oil would have, the value of 8,459 dollars~ Furture estimated
gas to be flared is 27,458 million cubic feet. This is equivalent on a heat
basis to oil amounting to 7.5 million barrels, this oil having a value of
--9--
14,784,000 dollars. Here again is the history of Alaska Pipeline Company
and projected growth indicating future growth in the Cook Inlet area.
MR. BURRELL: Thank you Mr. Miller. I will let the record reflect these
three exhibits in the order in which they were presented, respectively
Committee Exhibits 1, 2, and 3 and the Exhibits entered by Mr. Anderson will
be Atlantic Richfield Exhibits 1 and 2. Mr. McCann, I apologize for interrupt-
ing sir.
MR. MCCANN: That is alright. This statement is presented by Texaco
Inc, on behalf of itself and Superior Oil Company and will apply to the non-
unitized phase of operations as mentioned by Mr. Anderson.
The Texaco-Superior Trading Bay Platform "A" produces oil and its associated
casinghead gas from four separate accumulations composed of five separate
pool groups. They are the Middle Kenai "D", Middle Kenai "E", the Middle
Kenai Hemlock and the "G" NE and the Hemlock NE oil pool. At the Alaska
Oil and Gas Conservation Committee hearing on March 4, 1971 concerning the
use of produced casinghead gas Texaco presented a casinghead gas production fore-
cast which indicated the TexacO-Superior Platform would become fuel gas
deficient by May 1972. There has been no appreciable change to alter the trend
of that forecast other than to possibly bring the date closer at hand to the
requirement that we now generate part of our electric power at our onshore
facilities. The average producing rate from the seven producing wells in our
platform was about 3,740 barrels of oil per day and 920 MCF per day during
April 1971. Under normal operations the platform fuel gas and make-up gas
lift requirements total about 700 MCF per day, and all is taken from platform
produced gas. Casinghead gas is utilized as fuel gas whenever possible.
Stand-by shore gas is used on the platform for the make-up supply in case of
-10-
an emergency equipment down-time or platform start up. Considering the
relatively small volumes and the short life of the gas involved is is not
possible to market, inject or otherwise beneficially use it prior to becoming
gas deficient. Since we will be gas deficient before the July 1, 1972 date
being considered in questions 2 and 3 of the hearing notice, they would not
apply to our operations. This concludes our remarks in the non-unitized
phase of our operation for the Texaco-Superior interests. Mr. Anderson
would now like to continue testimony at this time with a Joint statement
concerning the unitized operation currently in consideration.
MR. BURRELL: Thank you Mr. McCann.
MR. ANDERSON: This is Mr. Anderson again. I would like not to discuss
Platf, orm Spark and Texaco's Platform "A" under the unitized operation. After
unitization of the "G" NE and Hemlock NE oil pools, water treatment and water
injection equipment will be installed on Platform Spark to serve injection
wells on both platforms. We expect to inject approximately 20,000 barrels
of water per day. Injection pumps will be driven by electric motors. These
motors will get their power from the Nordburg Turbine generators on Platform
Spark. A pipeline has been laid between the platforms to provide the water
injection in wells drilled from Texaco-Superior Platform. Both platforms and
the Granite Point onshore facilities will be operated by Atlantic Richfield.
Texaco-Superior wells not completed in the unitized reservoirs will be
produced by Atlantic Richfield on a contract basis. The proposed water flood
of the"G" NE and Hemlock NE oil pool will stop the decline of reservoir
pressure and consequently the decline in oil rate. In fact, the injection is
expected to bring the reservoir pressure back up about 1000 psi. The higher
-11-
oil rate will also mean an increase in gas production, since each barrel of
oil brings with it 250 cubic feet of solution gas. In Exhibit 3, incidentally,
there is an error in the exhibit in the title block about the 5th line down.
Superior should be capitalized. That is a drafting error and I will make a
public apology here and hope that will suffice. Exhibit 3 shows our prediction
of the total amount of the casinghead gas that will h~ ~rnduced on the tw~
platforms under unitized operation. The gas production is the solid line
here. Fuel gas requirements of Platform Spark will increase to handle the
entire requirement for the water flood equipment. Increased oil production,
treatment and delivery to the pipeline under a water flood program will also
cause slightly increased fuel gas requirements for the two platforms and
onshore facility, Exhibit 3 shows our prediction of fuel gas requirements
for these combined facilities. This again is the dashed line. This exh~ibtt
shows that in total, the combined facilities are n~w deficient and will remain
deficient in fuel throughout the water flood project. We expect to beneficially
utilize all the casinghead gas produced on these two platforms and plan to
make up our deficiency in fuel by purchasing extra produced gas from Mobil and
Union. Again, in response to the three questions in the call of the hearing
we expect to be beneficially utilizing all the casinghead gas produced on
Platform Spark and Texaco-Superior's Platform "A" by July 1, 1972 the effective
date of the order being considered. Gentlemen, that concludes my direct
testimony. I thank you very much ~.or your attention.
MR. BURRELL: Thank you Mr. Anderson. We'll have a few questions of
you sir. Has the contract for the purchase of gas from Mobil and Union been
entered into or is it still being negotiated?
-12-
MR. ANDERSON: A temporary contract has been entered into and we are
presently negotiating a long-term contract for that gas.
MR. BURRELL: Would you feel free to state the price of the gas that
you--the price you are paying for the gas inasmuch as it is already in our
records? Shouldn't somebody be paying royalty and taxes on it?
MR. ANDERSON: The price that we are paying for the gas under the proposed
contract?
MR. BURRELL: Yes sir, or an existing contract.
MR. ANDERSON: The existing contract is for 45 pound gas and we are
paying 6.2¢ per MCF of gas.
MR. BURRELL: Would you say that is an indication of the value Of the
gas being flared?
MR. SCOTT: Pardon me for objecting--that is a purely legal question,
and I sure would hate to see Mr. Anderson venture off into it.
MR. BURRELL: Would you care to answer it sir?
MR. SCOTT: No. No I don't think this was exactly the forum. I didn't
anticipate any questinns in that area in this particular hearing, and I think
it would be inappropriate to get involved. But obviously--well now I'm
about to do it aren't I? So I guess I'd better-~ ............. .
MR. BURRELL: Mr. Scott, as I understand it, the transaction price is
6.2¢ for 45 pound gas. 6.2¢ per MCF, is that correct?
MR. SCOTT: I don't remember, but I'm sure that is correct.
MR. BURRELL: This is an arms length transaction?
MR. SCOTT: Sir.
MR. BURRELL: Are there any further ~uestions? Mr. Gilbreth?
MR. GILBRETH: I have two or three little questions. Mr. Anderson on
-13-
your exhibit 2 which is the graph showing the gas produetion under
primary o~erations, primary predictions. I noticed an increase thate looked
like it was probably May of 1971 on gas production. Is this because of an
injection project?
MR. ANDERSON: No sir, this is not. Lhe reason for this increase is that
if you take our field measurement, we get something lower than 250 cubic feet
per barrel that we find from PVT analysis. The pmoJected part of the curves
since the 250 is the high number, and actually reflects the high gas
production, it is based on 250 cubic feet per barrel. Now as I as sure
you are aware our situation there is that we are handling in lift gas something
over 300 million cubic feet. I guess running 10 to 12 million a day in lift
gas and our formation gas running somewhere around 400 MCF per day, and so
when you measure your lift gas and then you measure total lift g~s and produced
gas and take the differencea very small meter error can cause considerable
error in your formation gas ~olume. And it Just is a very small formation gas
volume that you see the lower numbers on the produced volume prior to the
projection.
MR. GILBRETH: I have one other question with respect to the gas supply
that you now have. Could you give us any idea about how long it took to
consumate the preliminary contract with Mobil?
MR. ANDERSON: From the time we first looked into it until we consummated
a temporary contract?
MR. GILBRETH: Yes sir.
MR. ANDERSON: I could not--maybe Frank could.
UNIDENTIFIED VOICE: I'm not sure.
MR. GILBRETH: It took 30 days after you decided? Or 2 years or 3 years?
I am curious about one oil company to another on how fa~ ~b~v e~n contract.
UNIDENTIFIED VOICE: I'm not sure that our length of negotiation on
this 90 day interum contract would be a good indicator of that anyway, but I
think you can call it two or three months of initial discussions until we
finally decided upon an interum contract.
MR. GILBRETH: How long have you negotiating on the lonR-term contract now?
UNIDENTIFIED VOICE: You can't really pull them apart. We entered into
the interum contract so we could go ahead and start the machinery in motion and
make the physical arrangements while we continued to megotiate the long-range
contract. There weren't two separate and distinct neRot~ations.
MR. GILBRETH: I understand how that Roes, well--is this somethinR that
started say 6 months ago?
UNIDENTIFIED VOICE: I don't know. I would have to get our land department
over here to answer that question.
MR. COOK: John, perhaps I could answer that question, this is Ron
COok, with Atlantic Richfield. We didn't start any negotiations with Mobil
until January when the Kaloa well sanded up and we had a need for some excess
gas.
MR. GILBRETH: Alright, thank you Mr. Cook~ One other question and it
doesn't bear directly on the Trading Bay Gas case as we have it here, but
did you hear the testimony on the cases yemterday?
MR. ANDERSON: Yes I did.
MR. GILBRETH: Mention was made there about the Tyoneks needing gas
and Mobil having gas and seeing a line which belongs to ARCO. Is it possible
that ARCO might Join with these other three people to try to permit the
Tyoneks to use some of the gas if a deal could be worked out?
-15-
MR. ANDERSON: I certainly think it--I can definately say that in so
far as the use of the line if this is the route that they decide to go, that
we'd be willing to sell the line to them or we could reach some other agreement
with them. We certainly would not be a problem in working with them.
MR. GILBRETH: In other words the door is wide open?
MR. ANDERSON: The door is wide open.
MR. GILBRETH: That is all I have right now.
MR. BURRELL: Mr. Anderson as I understand the testimony of yourself and
Mr. Cook, and I don't care which one of you answers it, apparently you went to
gas deficient as a result of the Alberta Kaloa wells aanding up around January
and you almost immediately were able to consummate this temporary contract?
MR. ANDERSON: Well, the situation is much as it is now. We have the
ability to operate with diesel fuel and are operating one of the turbines--
one turbine with diesel fuel right now, and so you can't say it was immediate
but we began looking at that time.
MR. BURRELL: How long did it take till the Alberta Kaloa well sanded
up before you made some temporary arrangement to purchase the gas from Mobil-
Union?
MR. ANDERSON: It was two or three months wasn't it?
MR. COOK: We had it signed probably March 1.
MR. BURRELL: So it took perhaps 6 weeks or so after you became gas
deficiant from your previous supply from the Alberta Kaloa well.
MR. COOK: We first had to review the conditions on the Alberta Kaloa well
before we started anything and I don't recall the exact date.
MR. BURRELL: Is that a reasonable guess, about six weeks?
-16-
MR. ANDERSON: That would be the maximum.
MR. BURRELL: Perhaps less than that?
MR. ANDERSON: Definitely.
MR. BURRELL: That is certainly a lot better than the six year period that
a previous negotiater has testified to from 1965 to 1971. I must congratulate
your negotiating department on that. It has much more activity than some others.
Any other questions?
MR. GILBRETH: Just for the record have you actually started taking the
gas from Mobil yet?
MR. ANDERSON: We have taken some gas from M~bil now, however, it .....
MR. GILBRETH: Did you start during the month of April~
MR. ANDERSON: Yes I believe that was the first month we reflected mn
our reports to the State. On April the 22nd, I believe it was our first time.
MR. BURRELL: Mr. Marshall?
MR. MARSltALL: I have two questions Mr. Anderson. One can you furnish us
with a detail of the composition of the gas which you are presently buying
from Mobil?
MR. ANDERSON: I feel sure we would get that.
MR. MARSHALL: Fine. Could you get that to us before Friday at 4:00
while the record is still open on these hearings?
MR, BURRELL: We can hold the record open for a reasonable period of
time for you to get it to us.
MR. ANDERSON: As I said what we would do is request the compositional
analysis from Mobil unless you are wanting us 'to sample and analyze it right
at our point of taking it. And I'm sure that they have an analysis of the gas
-17-
or expect they do and we would request it form them.
MR. MARSHALL: I was thinking that possibly part of the negotiation would
be a limits of composition on which you would pay your price of 6.2 cents. I'm
not looking for an extremely detailed composition, not a particular sample
on a particular date, but perhaps the limits for negotiating and contract
purposes.
MR. ANDERSON: To my recollection the contract only requires that i~ be
stripped free of liquids and that is as far as the thing goes. I believe that
is correct sir.
MR. MARSHALL: Th~n we have an analysis in our files similar to the omes
you mentioned that woUld result if you took a sample, we do have that.
MR. ANDERSON: I would expect that would be true.
MR. MARSHALL: Then your only stipulation is that it be free of LPG liquids?
MR. ANDERSON: Yes sir. Free liquids, free to the extent possible. I
think it is fairly loose.
MR. SCOTT: May I suggest that we submit a copy of our interim agreement
for your records. You already have one on file if you care to incorporate it.
Would that speak for itself at this point?
MR. BURRELL: Mr.".Scott, I don't know that we do have a copy of' the interim
agreement, I 'ye never seen it.
MR. SCOTT: I'm sorry, you only have the results of the royalty payments
on file.
MR. GILBRETH: Until yesterday we didn't even have any record of any gas
being purchased by you from Mobil.
MR. SCOTT: This would be subject to Mobil's concurrence, of course, but--
-18-
MR. BURRELL: Mr. Scott I would suggest that it is not subject to Mobil's
concurrence. Royalty and tax payments on the purchases are due--royalty
payments are due monthly and tax payments are due quarterly, they were
due April 30. If they have not been paid they are deficient.
MR. SCOTT: No, I'm not talking about the royalty calculations. I'm
talking about submitting a copy of the interim letter agreement for this
particular record and for this particular purpose. Which is, of course, out-
side the scope of what you mentioned, but it might speak for itself on the
points that you mentioned. I am trying to be helpful, not argumentative.
MR. BURRELL: How much time do you need to submit the two items we have
requested, a copy of the interim agreement and perhaps in that would be
incorporated the second item, that is any gas standards that require liquids
that are somehow suddenly removeable. Mr. Anderson, this is Just free liquids
normal separation. How much time do you need sir, we will hold the record
open~.for any reasonable period of time that it is necessary to do so.
MR. SCOTT: Well, I hope to be--Just to be on the safe side why don't
you ~hold it open one week.
MR. BURRELL: We will hold it open a week from this Friday. On the close
of business June 4--Anchorage time, okay?
MR. MARSHALL: I have another question of Mr. Anderson. This dates back
to the previous two hearings we've had in this series. We were told yesterday
that a potential seller of casinghead gas was expecting a firm written proposal
from those would be purchasers. Just for the record did you approach Mobil
Oil Company with a firm written proposal when you wished to'buy casinghead gas
-19-
or did you go through a rather extensive negotiation period of at least
several months where you discussed many aspects of the sale and probably
arrived at a price in the later ~ahses of the negotiations?
MR. ANDERSON: I think as Mr. Cook has already stated we didn't go through
several months and I cannot state from first hand experience because I was
not involved in that particular negotiation, but I certainly would expect
that it started with a telephone call ~r conversation of wh~t ~ur needs were,
and then developed some of the particulars that would have to go into agreement,
and then start negotiating on that. Mr. Marshall, I think that it would be
the conventional approach.
MR. MARSHALL: Thank you.
MR. BURRELL: M~. Anderson, I have one additional question of you. Does
ARCO have to do anything with this gas that is purchased from Mobil Oil? Or
do you Just take it? Do you process it in any way whatsoever?.
MR. ANDERSON: We do not anticipate processing it in any way.
MR. BURRELL: You are getting it now aren't you?
MR. ANDERSON: We are getting 45 pound gas now and we are negotiating
as we pointed out yesterday for higher pressure gas.
MR, BURRELL: I see. With respect to the 45 pound gas you are not processing
it or stripping it in any way, you are Just taking it as it is delivered?
MR, ANDERSON: We are taking it as it is delivered,
MR. BURRELL: Are you in a position to state what pressure and what
stripping requirements are contemplated in the contract, the long-term
contract that is currently being negotiated?
MR. ANDERSON: Well, this was actually the one I was speaking to awhile
-20-
ago and I--which is the one I have read, the one that is currently in negotiation,
and it was the one where we are striving for 250 pound gas which is what we
desire and because its required to put in some of our fuel systems requires
250 pounds and the liquid requirements were as I have already commented. This
was based on that agreement and not the interim agreement.
MR. BURRELL: I see.
MR. ANDERSON: Which I had no direct knowledge of the details of the interim
agreement. I assume it was probably the same or perhaps looser.
MR. BURRELL: I don't have any further questions. Does anybody have any
additional questions of Mr. Anderson or ARCO or Texaco?
MR. KUGLER: Mr. Anderson, do you have any dry gas reservoirs under your
leases?
MR. ANDERSON: No sir, we do not. Under the Texaco's and Arco's area, no.
MR. KUGLER: Thank you.
MR. BURRELL: Are there any other quesions from the Committee or other
members of the Division of Oil and Gas? Mr. Bartlett if you have a question
would you come up here, please.
MR. BARTLETT: I do.
MR. SCOTT: During this pause could I ask you to admit Exhibit 3 in the
record, I think we over looked that.
MR. BURRELL: I believe you are correct sir, and will the record
indicate that we have accepted Arco's Exhibit 3.
MR. SCOTT: With the correction of the capital S for Superior:
MR. BARTLETT: Mr. Anderson I may have missed it but did you indicate how
much gas you are purchasing from Mobil at present?
MR. ANDERSON: Our present purchase is reflected in our State report.
-21-
Let's see if I can determine what this was. For April 1971 we purchased from
Mobil on a monthly basis 1,000,583 cubic feet which was 56 MCF per day. This
is averaged over the 30 days of April, and this is not representative of our
needs or our future takes. They are represented by the graphs that I
had presented on the Exhibit.
MR. BARTLETT: I couldn't get those figures down very quickly.
MR. ANDERSON: I have a copy of those right here.
MR. BARTLETT: Okay. In a very rough hand way, what do you expect your
needs are going to be over the next coming year? We heard testimony, I think
from Mr. Porter, that it was something in the neighborhood of 800 MCF per day.
MR. ANDERSON: The main division between the horizonal lines there is
1 million cubic feet or 1,000 MCF per day, and the figures that you are looking
for there are the separation between the two curves. It appears to me that looking
..at the graph, lets say right now our gas is estimated on that graph at about
600 MCF per day, starting about may and then it increases as we continue on
the primary through '71 down to the point where we start our flood project
which would be about the first of November. That appears to be about 1 million
cubic feet per day or 1,000 MCF, and then it increases till you go out to the
end of our chart at about 2 1/2 million on projection.
MR. BARTLETT: What--your contract with Mobil is that--will that be a
contract to take all that you need, in other words would you have an option on
the gas?
MR. ANDERSON: That is correct. Ther terms that Mobil was talking about
yesterday reflect the currently negotiated minimum take or pay provision of the
contract--800 MCF. In other words, you either take that or pay for it anyway.
-22-
MR. BARTLETT: And you are also thinking about buying gas from Union is
that right~.
MR. ANDERSON: That's correct. I think the 800 figure is actually a
combination of the two. I think if I'm correct on the gas split it is 75%
Mobil and 25% Union.
MR. BARTLETT: Is the contract that you are entering into a contract
with both Mobil and Union?
MR. ANDERSON: We would enter into separate contracts.
MR. BARTLETT: The same gas stream, I don't understand this?
MR. ANDERSON: Common gas '.
MR. BARTLETT: Okay, but it is owned Jointly by them--the~...gas?
MR. ANDERSON: You could take one person's gas and not the other. You
could split it on a volume basis.
MR. BARTLETT: Do I read this right here, this is about 1 million C.F.
between here and here?
MR. ANDERSON: That is correct.
MR. BARTLETT: So that up in here you are upto about 1.7 million?
MR. ANDERSON: The lower gas production curve, the reason for the drop
in the gas production is due to converting wells to water injection, which
reduces your oil rate for a short period of time, then you start getting
response from your flood. The increase in the gas at the same time is the
fact that you are starting up your water flood equipment and of course your
gas production climbs as you are getting response from your flood and your fuel
gas requirements increase as your fluid heating load increases. Until you get
up to nearly 3 million fuel gas requirements from mid '72 according to our
-23-
projection. This is the reason for that change in that area.
MR. BARTLETT: Right. Do you anticipate that you will be able to get
that 250 pound gas? Do you figure that you can get all you need from Mobil?
MR. ANDERSON: We certainly expect to, yes. From a Mobil-Union combination.
MR. BARTLETT: Have you given thought to taking that 45 pound gas on
a continous basis rather than taking--rather than entering into a contract
for the 250 pound gas?
MR. ANDERSON: We do not desire to take the 45 pound gas on a continous
basis in comparison to the 250 pound gas because to use that gas in our Spark
turbine we have to boost it to 250 poundS, so it would have to be compressed
somewhere to get it to that pressure, and so this is why we prefer the 250 pound
,
gas. rather than to compress it ourselves which would--our only source which we
, ,
have right now would be to back out and gas lift gas. Which is not desirable
,
when it comes to oil producing.
,
MR. BARTLETT: Have you gone throu..gh the steps of calculating what the
cost might be to put in pressurization, dehydration and stripping facilities
,
to bring that 20-40 pound gas up to what you~ need?
MR. ANDERSON: Yes, we have looked at that type of cost data primarily
and the reason for doing this is so that we can then fairly negotiate with
Mobil and Union on the price that we would pay for gas at the higher-pressure
and that's still right now in negotiating stages. That is my understanding.
Contracts have not been signed on what that would be worth at that pressure.
We have evaluated for our own in house purposes what we think that it would
take to come back to them to do this.
MR.. BARTLETT: Mr. Chairman, could I ask a ques~ion, I don't know if the
question is in different order, but can I ask a wuestion of Mr. McCann?
Who is a witness prior to this .....
MR. BURRELL: I'm sure that Mr. McCann would pull up another chair.
MR. BARTLETT: Mr. McCann, I wanted to ask what your plans are for
getting the gas when you get gas deficient?
MR. MCCANN: Well, we do have one shallow gas well, Nicolai #3, that
we pull from in an emergency. But the reserves of this well are rather ~.'
small, and other than that in our regular produced gas the last part of
this field wd~.~ll probably have to pull from somebody else too.
MR. BARTLETT: If given the fact that you still have some casinghead
gas and you have the Nicolai well, eventually those two aren't going to be
able to handle your gas needs sometime--some point in the future?
MR. MCCANN: That is probably right, depending on the water flood analysis,
which I don't know what the latter stages of might result in. I would guess
right now with the past performance of our Nicolai Creek well that it can
not be counted on in the long run, so we would have to look at someone else
for gas or go into diesel.
MR. BARTLETT: What other possibilities are there of your getting gas?
MR. MCCANN: Well .yes, we still have leases in the area and I would
hope that we would still be drilling in the area.
MR. BARTLETT: Would it be within the realm of consideration to go
over and pick up gas from the Mobil-Union stream?
MR. MCCANN: Are you talking about here in the future?
MR. BARTLETT: Yes.
MR. MCCANN: Well, Arco would probably be in a better position.
MR. ANDERSON: Let me clarify for the record that this project is a
-25-
combined operation of which Atlantic Richfield will be the operator of
the combined water flood project, adh this field gas requirement that we are
reflecting here is the total project fuel requirement and the total project
gas production.
MR. BARTLETT: I see. That covers .......
MR. ANDERSON: That covers Texaco and Arco--it will be a unit. We will
operate the Texaco platform, our platform and the onshore facilities.
MR. BARTLETT: If the needs of Tyonek would fit into your calculations
that you have made for pressuring, stripping and dehydrating the fuel that
you would be getting from Mobil-Arco, say it came in at 20-45 pounds. If
the Tyonek's needs, which are currently 1.2 million per day, would fit in,
would that make more feasible your processing the gas rather than taking the
high-pressure gas? That's a long question, did you understand what I am
saying?
MR. ANDERSON: No, it certainly would not make it more feasible for our
processing the gas because we are not equiped to process the gas at all
onshore, sf we have to process the gas at all it would have to be on the
platform Spark, where we have our compressors. We have no compressors onshore.
There is one other problem involved as I say and that is the total fuel needs
and there is a load of excess gas in the early period of time, but I had
looked at some combined numbers to see really how we could come out going
on the 20 pound gas with 3 million. If--I think Mobil said in their testimony
that they could get ashore about 3 million cubic feet at 20 pounds, and our needs
as shown on exhibit 3 could get to 2 1/2 million towards the~latter part of
our project. If we actually get up to 1.6 million cubic feet per day roughly
by the end of 1973, Just to take the difference of the chart there. I had from
-26-
testimony--and I guess I used a higher number, I think you said 1.4 and I
said if we take 1.4 million for the Tyoneks and 1.6 for the project's need
this would be 3 million. This is all that Mobil could get ashore even at
20 pounds. And then it is still in the situation where you have to compress
it and do something with it and that would only last till 1973--the end of
'73 and then we would not be able to fill our need, combined need any longer,
as I see it. That is Just strictly analysing the number you gave and the number
Mobil gave and the difference in our chart to see what we came up with.
MR. BARTLETT: That is all the questions I have.
MR. BURRELL: Thank you Mr. Bartlett. Thank you gentlemen. Are there
any further questions. Mr. Miller has a question.
MR. MILLER: Miller here. Mr. Anderson you mentioned that in your own
mind you had gone through this business of getting this 250 pound gas and have
some i~ea of what it is worth. Can you tell us what kind of a price per
MCF you came up with?
MR. ANDERSON: I request advice from my counsel since it is still in
the negotiating stage.
MR. SCOTT: You mean what it is worth to us, this specific gas with a
contract, of course some eventually reflect as to worth of any other gas?
Obviously I don't think Mr. Anderson ought to go into that. So far as we are
talking about these negotiations let me make one comment that may be a
necessary clarification. Normally, I think you can understand we deem it
rather inapproperiate to discuss pending negotiations in '~ublic. We have
tried to do so here, but we aren't trying to imply--we don't mean to imply
that Mobil is obligated to agree with our anticipat~d~'~provisions of the contract
-27-
or guidelines, nor Union either. But these are some of the concepts of the
following at this exact moment, we hope that we will conclude in a long-
term contract, but perhaps that clarification wasn't strictly necessary, but
if I were Mobil or Union I would want me to say that, so I am at this point.
MR. BURRELL: Thank you, Mr. Scott, we're not trying to delve into
details of negotiations, recognizing that they have certain proprietary values
and all that; however, we are trying to establish if there is a market for gas,
either at the present time or imminent - that is the thrust--to show that point.
MR. SCOTT: Well, of course, I agree that our taking Mobil's gas will
show that there is a market for the amount of gas we actually take. We're
not prepared to purchase all of the excess gas in the Inlet, a few require-
ments ................ (laughter)
MR. BURRELL: I wish they did.
MR. COOK: Mr. Burrell~ I would like to say one thing in regard to...
this is Ron Cook again of Atlantic Richfield. In regard to the expediency
with which we entered into a contract with Mobil after the sanding up of the
Kaloa well in January, there is a tremendous incentive on both parties and
Mobil is making money out of this and we are saving money in not having to
burn diesel, so it is an arms length transaction in' that regard.
MR. BURRELL: We recognize that. Have.you any further questions of
any of the witnesses. Mr. Marshall?
MR. MARSHALL: Maybe just one small point here. I believe the statement
was made here--I believe the statement was made there were no dry gas reserves
in the field under question and Mr. McCann mentioned that they were getting
gas from the Nicolai NO. 3 and Just for the record let's state that the
Nicolai No. 3 well is not in the field under question.
MR. BURRELL: Any additional questions? Thank you, gentlemen. We
have Mr. Griffin.
MR. GRIFFIN: My name is Griffin with Union Oil and I would Just like
to simply clarify the record that the negotiations as discussed by Mr. Scott
do include separate transactions between Arco, Union-Arco, Mobil and that we
would have no objection at all to giving you a copy and placing in the record
our temporary agreement with Arco to supply this fuel.
MR. BURRELL: Are you stating, Mr. Griffin, that they are separate contracts
between Union-Arco and Mobil-Arco?
MR. GRIFFIN: This is correct.
MR. BURRELL: Thank you. And you will provide those before the close
of the hearing, your interim agreement?
MR. GRIFFIN: Yes, sir.
MR. BURRELL: We thank you, sir. Is there anything further? Does
anybody else wish to testify?
MR. MCALISTER: Mr. Chairman, I am Wade McAlister, landman for Union
Oil Company of California. Union Oil Company as operator of the Trading Bay
Field Monopod Platform has one witness who will present testimony in response
to your notice calling this hearing. Reservoir Engineer, Mr. V. A. Isaacs,
Jr., has been previously qualified as an expert and ! request you to accept
those prior qualifications in establishing him as an expert.
MR. BURRELL: Mr. Issacs' qualifications are accepted for the record.
MR. MCALISTER: The marketing e~forts for the casinghead gas produced
from the Trading bY Field are virtually inseparable from the efforts to
market the gas produced from the McArthur River Field, Trading Bay Unit.
Since this is true, it would be more logical and more meaningful to present
-29-
testimony concerning these efforts at one time for both of these fields.
I therefore respectfully request that questioning concerning these efforts
be withheld until the hearing to be held tomorrow on Conservation File No.
104. Earlier in this hearing, you indicated the record will be held open
until the close of business on June 4 so that pertinent marketing testimony
given at tomorrow's hearing may be entered into the record of this hearing.
MR. BURRELL: So, with the understanding that the marketing testimony, as
you call it, to be presented tomorrow will be incorporated into the record
of today's i:hearing, that is acceptable; however, we do have one problem and
that is with respect to our most recently subpoenaed witness, Mr. John Bergquist.
I don't know whether or not he plans to be here tomorrow. I would'ask Mr.
Bergquist, sir, would you rather testify tomorrow than today?
MR.. BERGQUIST: That's fine with me. Tomorrow's fine.
MR. BURRELL: As long as your testimony tomorrow would be entered into
the record of today's hearing under the gJmeral category of marketing
information, I would have no objection to that if it's all right with you
sir.
MR. BERGQUEST: That's fine.
MR. BURRELL: Thank you.
·
MR. MCALISTER: Thank you, Mr. Chairman. Mr. Isaacs is prepared now
to give testimony if you care to swear him in.
MR. MARSHALL: Please raise your right hand. In the matter now at
hearing, do you swear to tell the truth, the whole truth and nothing but
the truth, so help you God?
MR, ISAACS: I do. My name is Bud Isaacs. This engineering testimony
will answer the questions as stated in the Notice of Public Hearing issued by
-30-
the Alaska Oil and Gas Conservation Committee. My approach is to show first how
the Trading Bay Field is operated to achieve the maximum recovery of the
field's Oil reserves and how we are utilizing the natural gas. And secondly
to answer the specific questions outlined in the notice of this public hearing.
Three pools within the Trading Bay Field have currently been approved for
pressure maintenance under water injection. These are the "C" and "D" Pools
of the Middle Kenai formation and the Hemlock Pool. They account for 81.3%
of the cumulative oil produced from the Trading Bay Field. T~o of these pools
have been under pressure maintenance; the "D" pools of the Middle Kenai and
the Hemlock Pool. The "C" Pools are scheduled for injection during the third
quarter of this year. Other projects involving the remaining 18.7% of the
produced oil are not amenable to pressure maintenance as much of this
production lies in small fault blocks and in shallow zones which cannot be
effectively flooded by either gas or water. The Monopod's injection capacity
is 30,000 barrels of water per day. Injection is not a capacity due to physical
well problems which will be corrected by a workover program to be implemented
in the immediate future. With the completion of this work the Trading Bay
Field should have an injection capacity of 35,000 barrels of water per day,
Union Oil Company and Marathon Oil Company feel that through these pressure
maintenance programs maximum oil recovery is attainable. When the three pressure
maintenance projects go on full stream the gas production is expected to
decline within a relatively short period of time-between one and two years.
This is reflected in Exhibit 1 which shows the produced gas and gas beneficially
used. This is the exhibit that was just handed out. We can put in on the
board .............
MR. BURRELL: Would you put one on for the benefit of the audience?
-31-
MR. ISAACS: By the way, there will be six exhibits. Ail of these
exhibits were prepared by me or under my direction.
MR. MCALISTER: Also, Mr. Burrell, in the future some of these will
be on slides and the slides are identical to the ones that we entered into
the record.
MR. BURRELL: We will accept the reproduced copies on the understanding
that they are duplicates of the bigger ones or the slides.
MR. ISAACS: Referring specifically to the questions which were stat-ed
in the notice of public hearing, question one has three parts which will be
answered in the order they appear. The first part of question 1 is, can
casinghead gas be marketed? As stated, this will be covered in tomorrow's
testimony. The second part of question 1 is, can casinghead gas be injected
into any reservoir or pools? Injection from the platform into underlying
reservoirs or pools has been discussed at length in previous hearings. The
following reasons for not injecting gas are applicable to Trading Bay Field.
gas injection in shallow sands. First, all shallow sands above the "B" Pools
are full of either water, gas or oil. Second, injection into these sands would
create high pressure anomalies which could prove dangerous to planned develop-
ment drilling; and third, the shallow gas sands are complexly faulted. These
faults may extend to the surface and may or may not be sealing at increased
pressures; therefore, any injected gas might communicate to the surface.
Gas injected into producing reservoirs: First, and foremost, this device when
used for pressure maintenance would cause waste. This waste would not be
obvious but would occur in the form of lost recovery.. A study involving gas
injection versus water injection on the "C" Pools reveal that oil recovery
would be reduced from 28.8% to 17.6% of the stock tank oil in place. Applying
-32-
this reduction is recovery to all other pools under pressure maintenance
would mean a loss of from 18 to 20 million barrels of oil by injecting gas
rather than water. Secondly, Exhibit 2 is a structure contour map with a
contour interval equal to 100 feet. This map is on about the C-7 sand, the
largest reservoir within the "C" Pools of fault block 2-A. This map is
structurally representative of all sands involved in the current water injection
projects of Trading Bay Field. Please not on Exhibit 2 the heavy dashed line
labeled A-A extending west, southwest from the Monopod through the bottom-
hole location of Trading Bay State A-24. This is the line of section along
which Exhibit 3 is drawn. This exhibit is a true scale, horizontal equals
vertical, structural cross-section of the "C" Pools in fault, block 2-A
along the dashed line shown in Exhibit 2. This section is similar and also
representative of sections that would show the "D" pools of HemlOck Pool.
The wells shown on the section are projected along bed strike. These two
geologic exhibits, 2 and 3, are presented to illustrate some of the potential
pitfalls associated with a gas injection project in the 2-A fault block that
could reduce oil recoveries. The average dip of sands in the 2-A block
is less than 10°. The low dips are not conducive to good gravity drainage
which is desirable in gas injection projects. The individual reservoirs
have significantly different oil-water contacts as shown on Exhibit 3.
Because of stratigraphic variations some reservoir sands silt in the different
sands vary considerably. This is a result of the geometry associated with
highly deviated holes to reservoirs with considerable difference in oil/water
contacts in areal extents. Because of the strata variation mentioned,
permeability variances within the various sands are extreme. Please refer
to Exhibit 4 which shows sandstone permeability variations from whole core
-33-
and side-wall samples. The permeabilities range from a low of 0.1 millidarcies
in the Hemlock to a high of 1260 millidarcies in the 56-1 sand. Ail of these
foregoing mentioned factors, low structural dip angles, differing oil/water
contacts, sand silt-outs, wide range in the number of completions per reservoir,
and extreme permeability variances contribute to waste that would be incurred
with gas injection through poor recovery due to gas channeling and lack of
drainage. On the other hand with water injection it is possible to flood from
the aquifer up-dip and drain these pools much more thoroughly. A comparison of
the gas/oil and water/oil mobility ratios of the "C" and "D" pools of the
Middle Kenai and Hemlock pool is another factor which adversly affects gas
injection. At the public hearing on Trading Bay Field applications for
redefinition of the Middle Kenai pools and for pressure maintenance projects,
~Gonservation File No. 93, Mr. Gilbreth requested water/oil m~bility ratios
of various pools which were subsequently entered into the record. For further
comparison the gas/oil mobility ratios are shown on Exhibit 5 as further
evidence that gas injection into the producing reservoirs of Trading B~y
Field will create waste or loss of oil which could be recovered by water
injection. Another alternative for disposit$on of gas that was investigated
was transmission of all gas not utilized for operations to shore for injection
in storage in an underground reservoir. A detailed investigation of geologic,
geophysical and well data reveals no onshore structures suitable for gas
storage are readily available to our facilities in Cook Inlet. The third part
of question one is: Can excess casinghead gas be otherwise beneficially
utilized by July 1, 1972. During the public hearing of March 4, 1971, testimony
was given concerning the past, present and future utilization of gas from the
monopod. At this time it was established that 2500 MCF per day would be
-34-
utilized, 1200 MCF per day on the platform, and 1300 MCF per day onshore.
Exhibit 6 breaks this down further, showing equipment, gas consumption and
rated horse-power. The function this gas serves is as follows: On the
platform; power requirements for drilling, power for water flood, heating for
platform, gas dehydration, compression for gas lift, compression for shipping
gas to shore, water flood deaeration. At the onshore site; power generation for
plant, pump fuel to ship oil to Drift River, and process heater, LEX shrinkage,
the liquids extracted to be combined with the oil. Further utilization of this
gas has been considered, but no equipment expansion is planned and consequently
the quantities utilized should remain as predicted. In summary, the answer
to part one of question one will be handled tomorrow, while the answer to part
two is no; gas connot be injected without creating extensive problems which
cannot be practically coped with in these reservoirs. The answer to part three
is also negative.
Question number two of this hearing requires an answer to the following:
Will the flaring or venting of casinghead gas after June 30, 1972 in excess of
the amount required for safety contitute waste as "waste" is defined in
Alaska Statutes 31.05.170 (11)? In answer to this question each definition
of waste expressed in the article will be discussed in relation to its application
,
to Trading Bay Field. The article reads as follows: "paragraph (11).~ "Waste"
means, in addtton to its ordinary meaning, "phySical waste" and includes (A)
The ~ef£~c~ent, excessive, or improper use of, or unnecessary disipation of,
reservoir energy; and the locating, spacing,~drilling, equiping, operating or
producing of any oil or gas well in a manner which results or tends to result
in reducing the quantity of oil or gas to be recovered from a pool in this
State under operations conducted in accordance with good oil field m,~neerin~
-35-
practices?" Addressing the first part of the question-the inefficient,
excessive or improper use of, or mnnecessary dissipation of, reservoir energy,
through the injection of water our efforts are directed toward minimizing
the loss of reservoir energy. There is also limited evidence that a natural
water drive exists in parts of the field. This is preliminary data which if
correct will also help to control inefficient, excessive or improper use of
reservoir energy. Addressing our answer to the remainder of this question and
the location etc., we can also state that the Trading Bay Field was developed,
drilled, equipped and is producing in accordance with all statutes of the
State and in accordance with good oil field engineering practices. The
Alaska Statute also defines waste as "(b) the inefficient above ground
storage of oil; and the locating, spacing, drilling, equipping, operating or
producing of an oil or gas well in a manner causing or tending to cause
unnecessary or excessive surface loss or destruction of oil or gas." Under
this definition the monopod platform does not operate in a wasteful manner.
The flaring of gms is not unnecessary or excessive waste under this statute,
as it is necessary in the production of oil. On our off-shore platforms where
space is extremely limited and safety conditions are the greatest concern,
the safest oil field practices must be and are being followed. Union Oil
Company and Marathon Oil Company have installed modern production safety
vapor recovery and fail-safe pollution control systems on the platform to
insure that no waste or pollution of Inlet waters occurs. We could belabor
this point by describing these systems and we would be more than happy to do
so upon your request on conclusion of my written testimony if this is your
desire. A qualified production engineer is in attendance to describe these
systems. The Alaska Statue also defines waste as: "(c) producing oil or gas
-36-
in a manner causing unnecessary water channeling or coning." Union Oil
Company and Marathon Oil Company are as concerned with this problem as is the
State. If this practice is allowed, a loss of oil can occur which is un-
desirable for all concerned parties. Through controlled water injection,
steps are being taken to insure that water channeling does not occur. To
date, the average cut for the Trading Bay Field is less than 3%, which indicates
that this has not become a problem. The Alaska Statutes also define waste as:
"the operation of an oil well with an inefficient gas-oil ratio';" All wells
on the monopod are being produced in compliance with this portion of the
Statute. The Alaska Statutes also define waste as: "the drowning with
water of a pool or part of a pool capable of producing oil or sas, except in
so far as and to the extent authorized by the department." Three water
injection projects have been authorized by the Department. These projects
increase recovery and would not fall into the category of drowning the pool
or part of the pool. This definition might apply where a well which cuts
water is shut-in, allowing water to stand over the perforated interval.
There have been indications that this has caused damage to productivity.
This may or may not be a problem. Work is continuing to determine whether
these damaging affects have long-range consequences. The Alaska Statute
also defines waste as: "underground waste". There is no evidence of under-
ground waste in the Trading Bay Field. Every effort is being made to increase
oil recovery from all pools in conformance with good oil field practices. The
Alaska Statutes also de~ines waste as: ;(G) the creation of unnecessary fire
hazards." The monopod platform, as well as associated shipping facilities,
are operated observing the most ~trtngent safety requirements in our industry
to insure no fire hazards exist. The Alaska Statutes also define waste as:
-37-
"the release, burning, or escape into the open air of gas, from a well
producing oil or gas, except to the extent authorized by the Department."
Gas not beneficially utilized on the platform or on the onshore site is
flared to the extent authorized by the Alaska Oil and Gas Cmnservation Committee.
The Alaska Statutes also defines waste as: "(I) the use of gas for the
manufacture of carbon-black, except as provided in this chapter." No
carbon-black is manufactured from the produced gas of Trading Bay Field.
In summary the answer to question two is there is no waste as defined by the
Alaska Statute 31.05.170 (11).
Question number three of this hearing aska: will more waste be caused
than prevented by an order restricting production of oil to a rate whereby
all produced casinghead gas is beneficially utilized or is required for
safety f~tare? The estimated gas required for fuel operation by June 30,
1972, should be apProximately 2500 MCF per day. If an order were issued
restricting the production of oil to a rate such th~'~ all produced casinghead
gas was being reused the oil production rate would be reduced f~om 18,000
barrels per day to 5,000 barrels per day. The effect of this reduction
would be to extend the life of the field from 1984 to 1992. This assumes there
would be no loss of either oil or gas reserves due to the reduction and that
the platform would remain serviceable for this period of time. One of the
incentives the State provided for developing new discoveries was discovery
royalty, which was granted on the Trading Bay Field. This incentive, coupled
with no allowables on production rates, provides the impetus to develop the
more marginal pools in the field. As an example, underlying the monopod are
many shallow "A" and "B" sands of the Middle Kenai formation. There are two
existing completions Qf the "B" sands. Plans for the next 12 months includes
-38-
three additional wells to be drilled to these shallow iow-productive intervals
to develop additional reserves. The shallowness of these sands and their
position in relation to the platform means that each well will be expected
to drain large areas. These are lower productivity wells which will require
from 10-15 years to drain their reserves. By restricting production based
on gas utilization, our predictions indicate we would not be able to continue
shallow "A" sands and "B" pool development until 1984. The normal life
expectancy criteria used in designing the monopod structure installed in
1966 was 25 years. This means that in 1991 the platform will have reached
its planned safe operating limit. Physical measurements of the effects of
mechanical abrasion by sand laden Inlet ice flows and deterioration of
exposed structural members by the corrosive Inlet water indicate expected
platform deteriation during the past five years. This establishes the
validity of the physical design criteria and ehe effectiveness of the extensive
cathodic protection systems in the hostile environment of Cook Inlet. Projecting
these facts it becomes clear the with the anticipated production decline and
limited life of the platform no economic Justification would exist for
additional drilling. This conclusion is based upon the extensive refabrication
of major platform structural members which would be required beyond 1991.
Insufficient income would be available from the curtailed production to
retire these expenditures in a profitable manner. Now is the time to develop.
these shallow reserves. It may, therefore, be concluded that restricting
production based on gas usage will, in addition to deterring currently
available production, precipatate a loss of between three and five million
-39-
barrels of proven reserves in the shallow "A" sands and "B" pools. It
should be noted that the estimated "A" and "B" sand recovery is very conserva-
tive, in that it represents between 5 and 10% of the calculated stock tank
oil in place. The reason for the conservative estimates have been previously
set out as being due to observed low individual well productivities caused
by reservoir sand properties and well spacing problems caused by the shallowness
of the sands and their position in realtion to the platform. Therefore,
restricting production based on gas utilization could, because of known
physical limitations of equipment and reservoir production characteristics,
cause the loss of at least 3-5 million barrels of proven reserves, which as
defined under Alaska Statute 31.05.170 (11) (F) constitutes waste of a valuable
natural resource. Gas is currently being flared on ~e monopod with the
approval of Alaska Oil and Gas Conservation Committee in order to produce oil.
Whether this constitutes waste requires that we consider the value of both
commodities involved. Is the remaining 20 billion cubic feet of gas that
cannot be reutilized worth more than 3-5 million barrels of oil what will be
left unrecovered if a restriction is imposed on the field oil production rate?
Particularly, is it waste when it is questionable that this gas would be
used for performing any service other than as fuel for equipment to produce
and market the oil? Based upon these arguments our answer to question number
3 is yes, more waste will be caused by an order restricting production of oil
to a rate whereby all casinghead gas is beneficially reutilized. In conclusion,
my testimony has shown evidence why Union Oil Company and Marathon Oil Company
must answer question numbers 1 and 2 with a negative answer and question number
3 with a positive answer. This concludes my testimony.
-40-
MR. BURRELL: Thank you very much sir, I suggest that we take a 15
~inute break.
(~m~O
MR. BURRELL: We will reconvene the hearing now. Mr. Isaacs Just
completed his testimony and we will now have some questions of Mr. Isaacs.
Mr. Isaacs I noticed you stated that the planned development drilling from
the monopod was three additional "B" zone wells during the next 12 months,
or did I understand that correctly?
MR. ISAACS: That is correct.
MR. BURRELL: Just a matter of curiosity how many slots are left in
that platform now available for drilling? Will this Just about use them up
or where do we stand?
MR. ISAACS: No, we have 10 slots of which we are utilizing--actually
there are seven slots, we have three for water source; two for water source
and one that has conductor set.
MR. BURRELL: So you have seven available now and you plan to use three
of them which leaves you four. left?
MR. ISAACS: That is correct,
MR. BURRELL: Your interp~e,~ation AS 31.05.170(11) (D) was, as I under-
stood it, that' the flaring of gas is not waste because it is necessary.
IS that correct?
MR. ISAACS: That is correct.
MR. BURRELL: Is that a reasonably correct summary of what you said?
Without getting into tomorrow's testimony would you concede that if there'ts
a market for the gas flaring would not be necessary?
-41-
MR. ISAACS: Yes, lets go back and read (D) again: "the operation of
an oil well with an inefficient gas-oil ratio", and w~ ,I,~'ve s~id i.~ we
are in compliance with this. This gas will be produced whether there is
a market or not and if there is a market undoubtedly that we could get to,
where we could in turn .......
MR. BURRELL: That is "B" I'm sorry.
MR. ISAACS: Excuse me I'm in the wronK spot. That is correct, we are
flaring the gas. M~ statement is that the flaring of gas is not unnecessary
or excessive waste under this statute as it is necessary in the production
of oil.
MR. BURRELL: But again, would you concede that if there is a market
either available now or reasonably available with reasonable effort that
it would not be necessary to flare it?
MR. ISAACS: We would have to have a safety flare.
MR. BURRELL: Other than a safety flare.
MR. ISAACS: Other than the safety flare.
MR. BURRELL: Then I Uad some trouble with your definition of your "h"
of the same statute. You stated that it wasn't waste because it was authorized
by the Department.
MR. ISAACS: That is correct.
MR. BURRELL: Then you would concede that if the Department didn't
authorize it, it would be waste, right?
MR. ISAACS: Waste, in t~he term as I have described later in my answer
to'. number three, in which we stated in our previous hearing that the gas
is being utilized to produce the oil and if we can't produce the gas then
-42-
in terms you have got a comparison of waste there whether it is waste not
to produce the oil or waste to not flare the gas.
MR. BURRELL: Is it waste to defer the production of the oil?
MR. ISAACS: We have also answered that, I felt, in the answer to question
number three.
MR. BURRELL: How about a yes or no now?
MR. ISAACS: No, its not waste now.
MR. BURRELL: It's not waste now, no, that is not my question. How
about your answering this question with a yes or no. Would it be waste
to defer the production of oil?
MR. ISAACS: Yes.
MR. BURRELL: It would be waste? What kind of waste?
MR. ISAACS: Well, it would be waste at the monopod from the stand point
that we have a limited life expectancy of the platform.
MR. BURRELL: What is the basis of that limited expectancy? What is
that limited life expectancy based on?
MR. ISSACS: Well, this was based on the design criteria.
MR~ BURRELL: In other words, it is going to wash away in the next year,
fall apart?
MR. ISAACS: I wouldn't say it is going to wash away, but it will become
structurally unsound and practically unserviceable.
MR. BURRELL: For what reason?
MR. ISAACS: Corrosion, erosion, the various factors that again we've
tried to lay out in the answer ~o number three.
MR. BURRELL: Do you have a study on that? Or any kind of an engim~ering
report, or do you have any analysis or any studies, have you had divers down?
How do you know it is going to be corroded away or eroded away in years?
MR. ISAACS: Mr. Burrell, as we stated in here we do have a qualified
production engineer in attendance today that would be more qualified to
answer that. I mainly deal with the reservoir portion of this, and if
you so desire we could have him come and give a qualified answer to these
questions ~ little more s~ecifically.
MR. BURRELL: I think we should, but I will let the other ~eople go
ahead and ask some questions first, zSbme other people may have questions
of him also. Does anybody else have any questions of Mr. Isaacs?
MR. MARSHALL: Mr. Isaacs, you mentioned that you contemplate the
completion or drilling of three additional shallow gas wells within a particular
period of time, I believe you mentioned it--the period of time in which you
plan to program these Wells?
MR. ISAACS: The period of time that we mentioned was in reference to
the reactivation of a work-over program, and work-over and development
program as it were for these shallow "B" pools that we have budgeted.
UNIDENTIFIED VOICE: Excuse me Mr. Marshall, did you say gas wells?
MR. MARSHALL: Yes.
MR~ ISAACS: Excuse me, these are not gas wells, these are oil wells.
MR. MARSHALL: My question would pertain to the sands above the "B".
I understood that you were going to complete some gas wells in the shallow
8ands above the "B" pool which you testified were filled with water, gas,
or I think, oil. Have we--are we talking about different things here?
MR. ISAACS: Yes, we must be. The wells that we have planned are to
the "B" Pools that are defined, plus we have seen other indications of
-44-
hydrocarbon-bearing sands that we desire testing along with these development.
Our development wells that are programed right now are for the "B" Pools
as defined in the statutes and naturally if we see something else that we
feel has oil, that we feel should be tested, we will in turn come to you and
ask to test or redefine these pools up to some of the shallower sand levels.
MR. MARSHALL: But then, these wells you mentioned were in your
consideration then principally oil wells?
MR. ISAACS: That is correct.
MR. MARSHALL: You have mentioned in previous reports that you
consider that there are gas caps which could be in existence in the No. 2-A
fault block. This I'm reading from Conservation Order No. 93. Quote, "gas
caps have been tested in two sands in the 2-A fault block." Could you tell
me, do you have any plan to develop these potential gas reserves from these
gas caps?
MR. ISAACS: I understand your question to say, to develop the gas
reserves.
MR. MARSHALL: Yes.
MR. ISAACS: No, we do not have any plans to develop the §as reserves.
MR. MARSHALL: Is there any mechanical reason why they could not be
developed .if they were needed? Do you have enough slots in your platform
to develop them if you need them?
MR. ISAACS: Yes, we could have gas well production. We do have
the production as indicated on your exhibit here, from a gas well on previous
occasions when we needed this gas prior to compression.
MR.'MARSHALL: Then there are undeveloped gas reserves beneath the Monopod
at this point?
-45-
MR. ISAACS: These are associated gas reserves.
MR. MARSHALL: They are undeveloped associated gas reserves.
MR. ISAACS: That is correct.
MR. MARSHALL: I see. Do you see any mechanical reason why these
undeveloped gas reserves could not be made part of a gas supply which would
remove the interruptibility which we have been told is a detriment to gas
sales?
MR. ISAACS: Again, it depends upon what the interrupttbility is. If
the interr,,ptibility is something effecting the pipeline, the answer to your
quesion would be no, because then we couldn't get anything to the beach. If
its an interruptibility due to ice and we did have free gas available, yes
we could produce these gas wells under that condition, assuming that we had
power on the platform.and there was noting else that interrupted us.
MR. MARSHALL: Yes, could you tell me your present pipeline connections ~
from your Monopod, both gas and oil?
MR. ISAACS: We have two eight inch lines that run into the onshore site.
MR.,~i MARSHALL: I see. And this is the onshore site that's termed, I
believe, the West Foreland facility?
MR. ISAACS: Yes, that is correct.
MR. MARSHALL: Yes. Could you tell us about the performance of these
pipelines as far as their reliability, let's say within the last .... since
their inception. Have you had any significant problems with the piPelines
as far as their continuity, breaking or any other problems?
MR. ISAACS: I'~ like to confer on that, I'm not sure of ......... .
One second, we haven't had any shutdowns as such. We have seen, the divers
have seen surface erosion, the normal wear-and-tear associated with the
-46-
sand-laden-scouring.
MR. MARSHALL: Thank you, Mr. Isaacs, that concludes my questions at
this time.
MR. BURRELL: Mr. Isaacs, just one question to enlarge on Mm. Marshall's
point. The Monopod has never been down for a pipeline break then, is that
correct--a pipeline break in the line from the Monopod to the West Foreland
production facility?
MR. ISAACS: Not to my knowledge.
MR. BURRELL: Then, any interruptibility problems could be solved by
development of the dry gas reserves under the Monopod?
MR. ISAACS: These dry gas reserves; these associated gas caps, if we
can show that cross section, are very small in extent.
MR. BURRELL: Do you have a rough idea of the reserves, the volume of
reserves, give a reserve figure for these?
MR. ISAACS: Not as such, we have not developed the associated reserves
.with the gas caps on the shallow sands where most of these do occur. We cmn
see from the map wehre it was very complex geologically, the faulting is
extremely difficult at times to even interpret. We have the 3-A fault
block, we have a very small fault block, we've seen gas but we also tried
to produce some of these reservoirs and have found the pressure drops off
immediately indicating even smaller reservoirs than we have mapped..
,~i~.~ M~. BURRELL: How many wells from the Monopod have tested gas sands
successfully, have found producible gas? How many wells, as the result of
a test?
MR. ISAACS: It depends what you define produciable gas as far as
-47-
quantities. We have tested gas to my knowledge in three wells. This
would be ..... I say tested gas, we have had fairly dry gas rates in the sands.
MR. BURRELL: And from those three wells you have no estimate of
reserves, one billion, one trillion or any ~_namber of reserves?
MR. ISAACS: These tests in all cases have proven to be associated
gas caps, and in other cases they have been to fault blocks in which pictures
change considerably from time to t~me and for me to give you a reserve figure
at this point--I'd be shooting from the hip. I would prefer ..... if this is
a great deal of importance, we can take this back and get with the geologists
and start doing some gas cap mapping. This would require isopa¢ on the gas
caps.
MR. BURRELL: Have you done that work, do you have a reserve figure
in your ....... ~.
MR. ISAACS: No, we haven't but maybe the one major "B" Pool which is
in the State record Conservation No. 3 ..........
MR. BURRELL: What were the reserves in that pool, Mr. Isaacs, approximately?
Your best estimate?
MR. ISAACS: Let me get to my records ........ Mr. Burrell, my sheet
with the various reserves, which are mostly oil reserves, is back at the office.
We can supply you with this number from the "E" Pools without any detail study.
This would Just require going back and getting it. I thought I had it in here
but I do not.
MR. BURRELL: Could you supply that tomorrow, sir?
MR. ISAACS: We surely can.
MR.. BURRELL: Ne~t question. Do you have any plans to develop these
gas reserves, I haven't heard of any and I was ~ondering if you had
-48-
MR. ISAACS: We do not have any plans to develop the gas. We are
developing the "E" pools. We have it under production now, which we can---
MR. BURRELL: What, if I may ask, do you know of any plans--eventual
plans for use of the gas cap? Do you have any long range plans for this?
MR. ISAACS: Until a market develops there would be no plan for this,
and again these are small and are associated with the oil production. It
would be detrimental to the oil production. We would naturally not blow
this gas cap.
MR. BURRELL: Well, are you not injecting into these pools?
MR. ISAACS: We are not injecting.
MR. BURRELL: You are not injecting in the "E" pool?
MR. ISAACS: That is correct, we are not injecting into the "E" pool.
MR. BURRELL: Do you plan to inject water into the "E'i' pool?
MR. ISAACS: We have this under study at this time, again we are limited
with our number of wells. This is a very small oil reserve at this point
as well as gas reserve, the pools do not have a large areal extent, concequently
the priority for flooding this is not as high as it is for the major reserves
in the major oil bearing pools.
MR. BURRELL: Is there any reason why there should be more than one flare
per platform? Operating at the same time?
MR. ISAACS: I can't speak for the other platforms, but on the monopod
I think this would be a good question to ask the Production Engineer, they
are involved in.~e design of these flares and for me to get into this I'm
not really qualified.
MR. BURRELL: Should I ask you what the size of the flare should be, or
should I refer that to the production engineer? In MCF?
-49-
MR. IMR. ISAACA: Uh--MCF--I'm not sure I understand what you mean by ......
MR. BURRELL: How much of a flare do you need for safety?
MR. ISAACS: I think that would be a good question for the Production
Department.
MR. BURRELL: Thank you. Mr. Gilbreth?
MR. GILBRETH: Yes sir. Mr. Isaacs, in listening to your testimony
I get the idea that about 81% of the Trading Bay pool is now under effective
pressure maintenance operation, is this true?
MR. ISAACS: 81% is under plan.
MR. GILBRETH: Can you tell us about what percentage is now actually in
operation. Or under the effect of pressure maintenance?
MR. ISAACS: Yes, this was mentioned in the testimony also. We have the
"D" pools and the Hemlock.
MR. GILBRETH: I didn't hear you mention the percentage aZ the testimony.
MR. ISAACS: No, I did not mention the percentage.
MR. GILBRETH: Is it half or a quarter or--we are left here hanging--
you gave us the 81% which sounds rather large. I am wondering how much is
really underway.
MR. ISSACS: It would be about 45%; between, say, 45 and 55%. This is
the major--these are the major pools as we have defined to the State where
our majority of production is coming from in Fault Block 2-A.
MR. GILBRETH: Yes, alright sir.
MR. ISAACS: By the way, if I-uh-also in the testimony was mentioned
that in the 3rd quarter we plan to be up--have the remaining "C" pools under
-50-
injection. This is a part of the same development plan we have.
MR. GILBRETH: In your plans now you say have been under injection,
does this mean one injection well? You will initiate water injection or
you will expect to have the entire pool under effective pressure maintenance?
MR. ISAACS: We plan to drill additional wells, injectors to put the
entire pool, as it were, under injection.
MR. GILBRETH: Alright. ~ reason for questioning, Mr. Isaacs, is that
I am trying to solicit information to determine Just how much of your property
operated from the monopod is actually under effective pressure maintenance
at this time, and how much might be a year from now. I think that the
testimony we have heard indicates there might be a difference in the way
that a property would be treated if it became necessary to prorate something
of that nature. Isn't it true that there are many, many individual pools
as such in the Trading Bay Field being separated by Fault Blocks and geological,
depositional, and deformation characteristics or things of this mature?
MR. ISAACS: Thst is correct.
MR. GILBRETH: Also, is it not true that many many of these are not in
communication with the adjacent fault block?
MR. ISAACS: To my knowledge they are not in ................ .
MR. GILBRETH: At least that is what--your best information. I believe
the Exhibit that you placed on the board, Exhibit maybe 2 .......
MR. BURRELL: Excuse me for interrupting here, but I'm a little bit
confused on these various exhibits. You have handed out a copy of Exhibit 1,
do you have copies of Exhibits 2 and 3?
MR. ISAACS: Yes. Upon conclusion of the testimony we do have some.
MR. BURRELL: You have smaller copies of these?
-51-
MR. ISACCS: · That is correct.
MR. BURRELL: They are duplicates of the slides?
MR. ISAACS: That is correct.
MR. BURRELL: Then lets let the record show we accept Exhibits 1, 2,
and 3.
MR. ISAACS: Fine.
MR. GILBRETH: Mr. Isaacs, didn't you say that this particular fault
block here was representative of all poels in the field?
MR. ISAACS: We mentimned that this was representative of the pools
that have--that are under pressure~,'~aintenance.
MR. GILBRETH: Which is representative of those under pressure maintenance?
MR. ISAACS: That is correct.
MR. GILBRETH: In other words they are representative of about ½ of
the field right now, ½ of your property?
MI~,.......I~SAACg: Maybe I should restate it. A planned pressure maintenance.
This is a pool that is not now under pressure maintenance. This is the "C"
pool that we have been showing as an example of the representative pool. We
plan to put this one under also.
MR. GILBRETH: Ultimately there will be several of the pool segments that
will not be under the effective pressure maintenance, will ther not be?
MR. ISAACS: That is correct.
MR. GILBRETH: It will mnly be the major portions of such as you have
outlined on your Exhibit 2 that will be under pressure maintenance?
MR. ISAACS: That is right. This involves approximately--well this
involves the figure of the 81%.
-52-
MR. GILBRETH: Alright. I believe one of the statements that you made
was something to the effect that if production is curtailed or the life
of the field is prolonged or that you can't drill or complete these wells
on the "A" and "B" pools that waste will thereby be created, was that not
true?
MR. ISAACS: That is correct.
MR. GILBRETH: Could I ask why you--let me ask another question. Wasn't
this because you have insufficient life to deplete the property?
MR. ISAACS: That is correct.
MR. GILBRETH: Then is it not true that you now are contzibuting to
that same waste by not already having the property developed?
MR. ISAACS: No - I can't go along ~i~th that from the standpoint that
we are not as smart when we start these things as we are today, and
we continually learn and if you will recall that the monopod in the first
few years of its life had five or six thousand barrels a day production, but
due to continued engineering and geologic studies we have expanded on
and found that we can produce some of the reservoirs and pools and sands that
we didn't know we could before and this is a learning process. It would
be nice if we were smart right from the start and could get all this .....
MR. GILBRETH: Yes I realize that, but today you do know that they
exist? You have plans to do it next year.
MR. ISAACS: Yes we have--in 1970 we completed a very extensive develop-
ment program, and during this development study we resolved many of the problems
we have had before and in turn raised production from 13,000 to over 20,000
barrels a day.
-53-
MR. BURRELL: Mr. Isaacs, I'm going to interrupt Mr. Gilbreth here to
follow this one point with his permission. When did you complete the last
well you drilled offf the monopod, roughly?
MR. ISAACS: Febuary of this year.
MR. BURRELL: Febuary of this year, and you currently have a drilling
permit in--an application in for a drilling permit, or do you--when do you
plan to drill your next well?
MR. ISAACS: May I take this in conference a second?
MR. BURRELL: Sure.
MR. ISAACS: The money for this work have been budgeted and approved
for the 3rd and 4th quarter of this year. The moneys include also,
remedial work that we plan to do first, and ~is is, as I mentioned, to get
some of our profiles in shape and to do some of the remedial work to get
our house in order prior to going to this development. It should be in the
latter portion of this year.
MR. BURRELL: Mr. Isaacs, is the drilling rig currently active?
MR. ISAACS: Negative.
MR. BURRELL: It seems to me that we are faced with a situat~ton which
by your own testimony, is that the platform is corroding away and eroding
away and all that, and that we are losing time here rapidly. It sounds like
waste to me.
MR. ISAACS: There are many things to consider and one is appropriations
and looking into this so we do not waste money and resources along the way.
MR. BURRELL: That is what we are' considering--the waste aspects.
MR. GILBRETH: Mr. Isaacs, my line of questioning was along this line.
From what you said it sounds to me like if we were to delay the development
of these reservoirs it was waste, but if you delay it i~ is not waste.
Am I wrong in that?
MR. ISAACS: Yes you are wrong.
MR. GILBRETH: Please tell me why.
MR. ISAACS: In order--we are limited by a number of slots on the monopod
we just can't go out and drill indescriminately.
MR. GILBRETH: But you have seven available now?
MR. ISAACS: That is right.
MR. BURRELL: I--excuse me for interrupting--I believe it is 10 and
3 are programed for use in these three wells you plan.
MR. ISAACS: We have other well that are planned, also.
MR. BURRELL: But you have 10 unused slots right now, is that correct?
Or did I misunderstand?
MR. ISAACS: We have 7 unused, 2 are being utilized for water source
wells and 1 is being used because it is unuseable--lets put it that way.
We have 7 that we can put wells into.
MR. BURRELL: I thought you said there were 10 unused.
MR. ISAACS: I was probably incorrect when I said
MR. BURRELL: I apologize.
MR. ISAACS: In answer to your question--in order that we can design
these wells, and have these wells get at the maximum penetration of all the
sands, that we feel are hydrocarbon bearing requires time. We drilled our
last development well in Febuary. This was our last completion. Rather than
go off half-cocked--not knowing what in fact is in the different fault blocks--
we wanted to get our geologic shop in order as well as our engineering analysis
of these pools. Concequently, we are in fact, actively pursuing these on
development in house today. Maybe the rig isn't rotating to the right,
but we are infact doing the engineering so that we can develop these in a
much more thorough fashion.
MR. GILBRETH: I can understand how it is necessary for a company
to develop their program and so forth, but is Just seemed to me like there
is a little bit of a conflict in your testimony there that if we were to
prorate and ~rolong the life you aren't going to get it out and yet you in
your earlier testimony said next year or in the future you were going to
be developing these and that is why I was asking these questions. I under-
stand now that you will be drilling this year, right?
MR. ISAACS: That is corre~.
MR. GILBRETH: You mentioned that tests have been made and you have
found gas in three wells, I believe it was to the effect that so far all of
it appears to be assoiciated gas?
MR. ISAACS: That is right.
MR. GILBRETH: Are you flooding any fault block in which you have found
associated gas?
MR. I~CS: Negative.
MR. GILBRETH: You are not. Do you anticipate flooding in any block
in which you found associated gas?
MR. ISAACS: We do have the "E" pool under study as was stated in
Conservation File 93.
MR. GILBRETH: Alright. Then if you are going to inject water will
it not be necessary to inject gas to deep from saturating the dry gas section
in the gas cap? To prevent waste?
MR. ISAACS: Again we are studying this, we do not have a plan. We
can also do this by injecting water into the gms cap which we are more
equipped to do.
MR. GILBRETH: You are equipped to inject water into the gas cap?
MR. ISAACS: We are equipped to inject water whether it goes into the
gas cap or into the aquifer or into the oil zone, it depends upon
MR. GILBRETH: Okay, I'll concede that. If oil does, in fact, get
into the gas cap it will re-saturate the dry gas cap and result in a loss
of ~ltimate recovery will it not?
MR. ISAACS: This is an accepted ......
MR. GILBRETH: In other words, if you were to inject into this fault
block would it not be good engineering practice to inject both water and
gas?
MR. ISAACS: Depends what the--again what the study and how our configurations
--to my knowledge we do not have--we do not today for sure, we would not have
the capability of injecting gas on the monopod. At the pressures that would
be required, say, into the "E" Pooling:which is the one we are referring to.
MR. GILBRETH: But from a standpoint of good engineering practices .....
this would be a good engineering practice, wouldn't it? If you are going
to water flood and you have an associated gas cap to maintain your gas/oil
contact circle no higher than the original contact?
MR. ISAACS: That is correct. In the testimony we brought up a number
of factors indicating why gas injection was undesirable, particularly on the
monopod in the Trading Bay~Field. And the gas caps that we have seen, associated
gas caps, are relatively small and these same arguments hold true for injecting
gas into our gas caps. Again we have done a detailed analysis of this, and
this is why I say in general your statement that it is good oil field practice~.
to maintain this gas cap is correct. Now in.
MR. GILBRETH: I realize you haven't made the study, but in the absence
of any other knowledge this would be considered good engineering practice.
MR. ISAACS: That is
MR. GILBRETH: Your study may have indicated that it is not, in some
future date, is that correct?
MR. ISAACS: That is correct.
MR. GILBRETH: Alright sir. I believe you indicated in your testimony
that you now have a 3% water cut. Is this water cut--first of all is this
what you testified?
MR. ISAACS: That is correct.
MR. GILBRETH: Is this water cut from wells mainly within the fluid
injection area? Or is it from wells outside the injection area?
MR. ISAACS: We are seeing water cuts in both areas.
MR. GILBRETH: Well, I -- this was leading to a question. Do you think
there' is an effective water drive in the Trading Bay, in any of your reservoirs
in the Trading Bay Field that you operate from the monopod?
MR. ISAACS: As I say, you had preliminary indications of this.
MR. GILBRETH: Is it extensive or in a verylimited fault block?
MR. ISAACS: We have seen some evidence in one well is all, and it
takes much more than this to develop whether in fact we do have water drive.
MR. GILBRETH: I think your general consensus the, I would assume,
would be that you are basically operating under a solution gas drive or
a fluid expansion drive?
MR. ISAACS: This has been our conception to date. This is subject to
change, as I am sure you are w~ll aware, depending upon what state of
depletion is.
MR. GILBRETH: Alright sir. If I may go back for Just a minute, back
to this associated gas. Would it not be possible, if it became necessary
to inject gas into the associated gas cap from a standpoint of safety--
safety only--would it not be possible to inject into the gas cap without
creating an unsafe condition?
MR. ISAACS: If this is a Safety problem, again I would prefer to let
the production--qualified production engineer handle that.
MR. GILBRETH: Alright, let me ask from the standpoint of reservoir
safety. Would it be a dangerous practice, from reservoir safety standpoint?
Can you see any danger that would accrue from injecting into the associated
gas cap where you are withdrawing oil that obviously is down dip~
MR. ISAACS: The danger under this condition would be with, again, the
permeability variations and all the data that we presented. The danger would
be to the reservoir--you would have channeling, in fact become a cyc]~type.
Again, this is eliminating the surface safety.
MR. GILBRETH: But, you'd have that condition exist naturally anyhow
do you not? You have the associated gas cap there and you have the oil bond,
don't you have that condition existing normally anyhow?
MR. ISAACS: In general with the associated gas cap you always have
problems with them--with gas getting into your oil somehow. To qualify that
a little further, if we were to inject into this gas cap at a higher pressure
we've only--expecially the "D" Pools now--our voidage from that, I'm sure you
are well aware, is about 500 thousand barrels. This does not provide us with
a great deal of room to pressure above the original conditions, and if we
were to take this pressure higher than the original conditions, and if we
were to take this pressure higher than the original conditions there would
be additional danger which could be incurred. This would mean you would have
an anomolous high pressure for this region, which you may not want to be
with. We would not.
MR. GILBRETH: In other words, anything beyond the original pressure
of the original gas-oil contact might not be desired.
MR. ISAACS: That is correct.
MR. GILBRETH: Did I understand you to say that the "A" and "B" sands
that are undeveloped contain water, oil and gas?
MR. ISAACS: To our knowledge they have all three phases.
MR. GILBRETH: Do you--have you tested any of them for gas?
MR. ISAACS: Yes we have tested gas in the "B" pools.
MR. GILBRETH: But--well is this the associated gas you were talking
about earlier?
MR. ISAACS: That is correct.
M~, GILgRETH: In other w~rds, at this stage you have no knowledge of
any so called dry gas zones .~at have been tested in the Trading Bay Field?
MRo ISAACS: That is correct.
MR. GILBRETH Your best engineering .and geological analyses-~do you think
you have any? Have you speculated on this yet?
MR. ISAACS: One second. To our knowledge we do not have any dry gas
sands.
MR. GILBRETH: In other words, to the best of your knowledge you would
not have a dry gas sand that could be reached from the monopod that could
act as a back-up supply to ease this interruptibility problem?
MR. ISAACS: That is correct.
MR. GILBRETH: Alright, sir. In the earlier testimony, several hearimgs
back, I'm not sure that it was with regard to this particular pool, but
testimony has been presented to the Committee indicating that its not advisable
to inject gas mntil we have completely ruled out water injection as a recovery
medium. Can you tell me, has water injection--have water injection operations
proceeded to the extent in the Trading Bay Field that you can rule out gas
injection as a recovery medium?
MR. ISAACS: We are still in the preliminary stages of water injection.
So the same answer to that question would apply as was stated--as you just
stated.
MR. GILBRETH: In other words, you still don't know whetere or not you
can rule it out~
MR. ISAACS: From the standpoint of how the water flood recovery is
proceeding~
MR. GILBRETH: Did you hear the testimony day before yesterday with
regard to the Middle Ground Shoal flaring situation?
MR. ISAACS: That is correct.
MR. GILBRETH: Did you hear Mr. Giles testimony about restricting
production and restricting injection and possible damages that might accrue
as a result of it.
MR. ISAACS: That is correct, yes.
MR. GILBRETH: Are you in agreement with the conclusions that Mr. Giles
reached that restriction of production or injection probably would cause
reservoir damage, or waste of reserves?
MR. ISAACS: I would agree with the practical waste of reserves.
MR. GILBRETH: Could you eXplain that please.
MR. ISAACS: Basically, oil recovery from water injection is a function
of throughput. We've established that the platform has a finite life and
ultimately or practically with this finite life it would be waste idue to
loss of recovery, by in ~fact decreasing the amount of injection.
MR. GILBRETH: In other words, you are telling me that by reducing
production or injection it would extend the life and increase the economic
limit, which would in fact result in less ultimate recovery. Is that right?
MR. ISAACS: That is one of the factors to be considered when
restricting injection. There are other factors; we have problems, you've
noted on the cross section with sands that are of differing permeabilities,
differing areal extents and consequently there are some other factors. One
is the Problem that I mentioned that we have also under study and that is
the damaging effect of water standing over the well bore, in other words not
keeping the well pumped off.
MR. GILBRETH: Along this particular line, do you have any evidence at
this stage, I recall some hearings earlier where you felt that this was a
very strong probability. Do you have any evidence to date that there is damage?
Have you run any tests since the last hearing where you testified that you
thought there was damage.
MR. ISAACS: Yes, we have seen--again, this is preliminary--this is
why we did make the statement in testimony we have seen ~tn one case, but we--
felt was damaging to the water in one particular well.
MR. GILBRETH: I see. Would you say as a general statement that the
reduction of injection or the reduction of production would cause reservoir
damage to the extent of waste of the natural resources?
MR. ISAACS: In the particular instance or circumstance at the monopod
it would create waste as I defined because of the finite life and the loss
in recovery from sands that would not leave us the incentive as it were to
develop at this point in time.
MR. GILBRETH: Part of your reservoirs, I assume, are not rate sensitive
that you testified that they are solution driven and you have little knowledge
of water drive. Does this sound right?
MR. ISAACS: Again, with limited preliminary evidence, that is so.
MR. GILBRETH: And, there still is a large portion of the reservoir
that you intend to flood or place under pressure maintenance operations
that is not yet under operations?
MR. ISAACS: That is correct.
MR. GILBRETH: Can you give us any idea about what kind of a lag period
you are experiencing from the time you start injection until you see some
results?
MR. ISAACS: We've~'performed model~studies on certain reservoirs in
the Trading Bay Field and the lag time was--to give you a figure I have to
go back and review those models, but as I recall it wasn't a tremendous deal
of time--in the order of maybe a year to a year and a half that we began to
see response.
MR. GILBRETH: Do you agree with the testimony of Mr. Logan and
Mr. Giles, that the recovery which you will get from a pressure maintenance
operation will depend on the rate which you inject fluid, and this is controlled
by the operator or designed in each project?
MR. ISAACS: I have not run studeis on this nor have I read the papers
that they refer to so--in fact I can't testify to the validity or the
invalidity of that statement.
MR. GILBRETH: I see. Thank you.
MR. MARSHALL: I have a question Mr. Isaacs. Marshall here. You
mentioned the initial production rate of I believe about five thousand
barrels a day from the monopod for some considerable length of time and the
rather bleak outlook for the monopod's economics in the initial stage. Are
there now any depleted oil reservoirs under your monopod?
MR. ISAACS: Again, it depends which you call depleted. We have produced
oil from certain reservoirs that, as you will note in your records, we have
subsequently plugged back and moved up the hole. The reason normally for
this is not due to what maybe defined as a depleted sand in the sense that
they have zero pressure. Due to lack of definition of what depleted means
I would have to say from what t consider depleted, no, we don't have any
depleted reservoirs. They are still reservoirs with pressure of more than
what we would consider abandonment pressure at a certain point in time.
MR. MARSHALL: And what is the fluid content of these abandoned reservoirs
now? We~e'~..they abandoned because they ceased to produce oil Q~ were they
abandoned because they started to produce water?
MR. ISAACS: They were abandoned because they--we felt they reached
their economic level of production of oil.
MR. MARSHALL: Were they producing water when they were abandoned?
MR. ISAACS: No, they were not.
MR. MARSHALL: Can you tell me any reason why these abandoned oil
reservoirs which are not producing water could not be utilized for gas
storage?
MR. ISAACS: If there--if the cummulative production that we have taken
from these reservoirs that we have plugged back is any indication and the
pressure data that we have associated with this is any indication of the size
of the reservoir they are extremely small and of really insignificant
consequence when it comes to a potential place to store gas as it were.
MR. MARSHALL: The size of these reservoirs then could be ascertained
in some degree by the volume of fluid that has been withdrawn from them?
MR. ISAACS: That could--that in conjunction witht'~e pressure data,
yes, you can determine what area was drained.
MR. MARSHALL: Thank you.
MR. GILBRETH: Mr. Isaacs, most of us are familiar with it, but just
for the record doesn't all of your produced gas from the monopod go to the
Trading Bay onshore facilities for processing or extraction of the liquids
that you don't use~
MR ISAACS: A portion of the gas that we don't use goes to the onshore
facilities.
MR. GIBLRETH: Can you tell us about what percentage of your total
production goes onshore?
MR. ISAACS: Excuse me while I divide.
MR. GILBRETH: I won't hold you to a specific definite answer.
MR.. ISAACS: Approximately 20-30% goes to the beach.
MR. GILBRETH: 20-30% goes to the beach, the remaining 70-80% then
is used on the platform, or used and flared on the platform?
MR. ISAACS: It is used and flared on the platform.
MR. GILBRETH: Can you tell us why the gas is flared on the platform?
MR. ISAACS: The obvious answer is iow pressure and it would cost
money to ship it to the beach.
MR. GILBRETH: In other words, you are shipping to the beach all that
you can without installing compression equipment to move it to the
beach?
MR. ISAACS: Additional compression equipment.
MR. GILBRETH: I mean additional compression equipment. Are you the one
to answer--I would like to know if the gas that is being flared on the
platform is being stripped in any way of liquids?
MR. ISAACS: Our production engineer could better handle that.
MR. GILBRETH: I believe that is all I have, Mr. Burrell.
MR. BURRELL: Thank you, Mr. Gilbreth. Mr. Marshall, do you have any
additional questions?
MR. MARSHALL: Not at this point.
MR. BURRELL: Mro Isaacs we will ask you to stand by. '~e may have some
more for you after we get the production engineer up. Does anybody else
have any questions of Mr. Isaacs~ Does anybody in the audience have any
questions of Mr, Isaacs at this time? We will probably have him back here ~
after hearing the production man. Could we then ask the production engineer
to come ~p and if he hasn't been previously qualified to state his qualifications.
MR. MCALISTER: Mr. Fred Duthweiler has not been previously qualified
and h~ will at this time present a little of his background and to request
following his presentation that you establish him as a qualified expert.
MR. BURRELL: Could we have the spelling of Mr. Duthweiler's name?
MR. DUTHWEILER: D U T H W E I L E R.
MR. BURRELL: Thank you Mr. Duthweiler.
MR. DUTHWEILER: My first name is Frederick and I am a graduate of the
University of Washington, I have a Bachelor of Science degree in mechanical
engineering. I upon graduation, Joined Union Oil Company of California
and I have worked at various positions fdr the company since my graduation,
including design, construction, installation and for the past two years I
have been the Production Engineer for the Union Oil Company associating with
Union's operation in Cook Inlet.
MR. BURRELL: Thank you sir. Would you rather sit down? You can if
you want to. I'm sorry, I shouldn't have had you sit down, we have to
swear you in.
MR. DUTHWEILER: Oh.
MR. MARSHALL: In the matter now at hearing, do you swear to tell
the truth, the whole truth and nothing but the truth, so help you God?
MR. DUTHWEILER: I do.
MR. BURRELL: Let the record reflect that we accept your qualifications
as an expert witness, sir. I'm a little bit concerned about this corroding
and eroding monopod. I haven't heard any testimony as to this in the
previous two days testimony and in both cases the platform under discussion
there were installed prior to the monopod. I Just wonder if it is Just poor
quality of steel or design problems? Is it an area that is subject to more
scouring? What is the reason?
MR. DUTHWEILER: No, I do ~elieve that possibly it hasn't been a point
that has been touched,.on. Union Oil, since they installed their first
platform has been very concerned with this. As you know, Cook Inlet has' very
thick and deep ice and the ice while rubbing on the legs in the winter time
will produce a mirror finish on these legs, and this is a wearing factor--
the monopod has a wearing in the plate which was installed to protect
against th~s particular problem--and in fact will erode away.'in a period
of time. No additional such structures were installed in Cook Inlet so this
had to be of theoretical nature when initially designed. We have, since
the platforms have been installed, installed cathodic protection on the plat-
forms which is a means of trying to protect the steel from the salt water
attacking of the metals. We have a research department in Brea, California
and we have an expert, Eric Headworth. Mr. Headworth has made numberous
trips to Alaska, the last one of which was in April of this year, and we have
taken ultrasonic readings of the wear that has actually occured on this plate.
The last readings that we got indicated that we are losing approximately
10 mils a year of steel. We also noted some pitting which, due to the water,
could be expected. Some of the pits were as deep as 60 mils. We have.~also
dOVe in Cook Inlet on a regular basis every year to check both our pipelines
and our platforms underneath. Cook Inlet is extremely salty and once the
diver is below about 10 feet underneath the water he looses all visibility
and so all survey work is done by feel. From the information that we get
on diving we do have a rough surface down underneath the water. Diving
time is extremely limited in Cook Inlet--we can only dive on either high
,,
or l~w slack water. Also diving is extremely expensive in Cook Inlet. At
this time we estimate our cost somewhere between~'~200-250 dollars a bottom
minute and we are probably limited to a 30 minute dive every 6 hours. Under-
water welding techniques are developed but are slow in doing any underwater
work; visibility of coursewould be a tremendous asset which we do not have.
Also pu~n~ ~n l~r~e members of large additions--we would probably not be
-68-
capable of doing it in a 30 minute period. Therefore, you could not put
the piece in place and weld it in one tide, and in fact would have extreme
difficulty holding it in place through a tide to get in and weld it on the
next tide. Maybe our technology will get better.
MR. BURRELL: Have you seen any evidence of corrosion or wear except
on this protective plate?
MR. DUTHWEILER: The only other one is when the diver himself has
been down on the very bottom and walking around I have talked with him on
many occasions and he tells men that his gloves collapse as the water
pressure gets greater. Through he is wearing 1/4 inch gloves, which are
quite thin when you are down there, he feels the structure and from what he
tells me he is experiencing very rough corroded surfaces on bottom even
with the cathodic protection that we do have.
MR. BURRELL: Can this protective plate be replaced--it is welded on,
iS it not?
MR. DUTHWEILER: Yes it is. It is welded on.
MR. BURRELL: It could be done un~r the circumstances which you indicated
difficulty in anchoring it in place and coming back ~th a welding
torch next time?
MR. DUTHWEILER: That is correct, assuming we could hold it. Why,
I would say that it would be an engineering feat, but probably humanly possible.
MR. BURRELL: The other ~uestions I recall being delayed until your
presence were related to the flare. Do you know of any reason why there
should be more than one flare operated at one t~me per platform?
MR. DUTHWEILER: We do have two flares on both of the operations of the
Union Oil and the main reason that we have two tlares is because we have
a drilling rig on the--both rigs or both platforms and the gas is flaring.
If the wind is blowing in a certain direction it has a tendency to
blow the heat back on to the ~f~. If we have a derrick man in the rig, em~ecially
during a cmucial period of time, it can actually get so warm that that
gentleman cannot stay up in the rig, and therefore, by having two flare booms
we place them such that the prevailing winds--we can pla~ the prevailing
winds and get the heat ~way form the derrick man.
MR. BURRELL: But you still have them both going at the same time?
MR. DUTHWEILER: Well, when you have a flare--a flare is of a safety
nature and it is very dangerous if you have a flare that you would possibly
be running gas through and not bur~ng the gas.
MR. BURRELL: Why couldn't you shut off the one that you .......
MR. DUTHWEILER: Well, we could but then as I say if we have a change
of wind and an emergency at the same time when we start flaring then we have
the problem of lighting the flares so as a safety precaution we run both~
flares. Therefore, we can shut--if the wind is prevailing such that it is
putting heat on to our platform, then we Just shut down and run all of the
gas out of one.
MR. BURRELL: Do you have to run both flares while the drilling operations
are in progress?
MR. DUTHWEILER: We don't have to but as I said as a safety precaution
we feel that it is far safer to run the two while we have them.
MR. BURRELL: Why don't you run four of them' wouldn't that be safer
than '.two? Twice as safe?
MR. DUTHWEILER: No, not really. Because just the amount--first off
the platform is quite limited in space and.
MR. BURRELL: You mean if you had more room you'd have more flares?
MR. DUTHWEILER: Not--probablY not more flares, but two. How many
spare tires do you carry in a car. If we had one it is safe and if we had
two are we 100% safer? I don't know. We play the prevailing winds with
two. We can play it with generally any direction that we have, so I say
no, two flares are adequate.
MR. BURRELL: Thank you. Mr. Gilbreth?
MR. GILBRETH: I asked a question about the amount of?~s that is beimg
flared on the platform, were the figures that Mr. Isaacs gave right as far
as you are concerned?
MR. DUTHWEILER: I don't personally recall the figures that were giVen.
I can.
MR. GILBRETH: I think he gave the figure of 20-30% of the gas moves to
shore to the best of his recollection.
MR. DUTHWEILER: The balance being flared?
MR. GILBRETH: Is there any stripping taking place of any gas that is
being flared?
MR. DUTHWEILER: We have separators and scrubbers which let us take.
all liquids out of the gas prior to any flaring operation.
MR. GILBRETH: Do you recover quite a bit of liquid out of the gas or
is it rather nominal?
MR. DUTHWEILER: I wtll have to decline that. I have really never
closed off the separators and watched what kind of build-ups we get in there.
~. GILBRETH: The type of stripping you are talking about--just
entrained liquids, are they not?
MR. DUTHWEILER: That is not
MR. GILBRETH: Do you have butanes and propanes and this sort of thing?
MR. DUTHWEILER: No, I mean we could catch them if they were in a
liquid stage, but we do not have equipment ot particularly extract them.
MR. GILBRETH: Alright sir. At the present time do you have two lines
to shore from the monopod?
MR. DUTHWEILER: Yes, we do.
MR. GILBRETH: Do you have lines connectinR the monopod with any other
platforms?
MR. DUTHWEILER: No, we do not.
MR. GILBRETH: It would not be feasible without laying another line
to try to compress gas or do anything with the gas onshore and move it back
to the monopod?
MR. DUTHWEILER: No, as you know, at this time we are trying to move
gas from the monopod to the beach. It wouldn't seem reasonable.
MR. GILBRETH: At this time are there any plans afoot to connect the
platforms up with the line where there could be an. interchange of gas?
MR. DUTHWEILER: I don't believe there are.
MR. GILBRETH: Alright sir. That is all I have, sir.
MR. BURRELL: Does anybody else have any questions? Mr. Miller?
MR. MILLER: Miller here. You have scouring action below your wear
plate on down near bottom on the leg?
MR. DUTHWEILER: On the monopod we have experienced a small amount of
it. Generally very good, the platform. The monopod is built with two large,
what we call pontoons, and those two pontoons lay on the bottom of Cook
Inlet. Then they are pinned to the bottom and, generally speaking, we have
got good contacts between the pontoons and the bottom.
MR. MILLER: I was trying to determine if the diver who felt roughness
wes trying to determine the ultimate life, whether this roughness is due
to build up of sea deposits and so on or if it is really indicating a certain
amount of wear due to corrosion.
MR. DUTHWEILER: One of the statements--we in fact were diving at the
earlier part of this week, not at the monopod however, but on the Grayling
platform. One of the statements that the diver made to me is that as he
went down the leg it got rougher as it got ~eeper, and we tried to determine
why this particular situation occured. The only thing we could come up
with was the silt in Cook Inlet which has an e~fect with the high tidal
action of actually cleaning the leg and possibly the high velocity and the
silt has actually cleaned off the upper portion. Where you get down toward
the bottom the actual water velocity does get somewhat less.
MR. MILLER: There might be less build up of deposit at the top, ra~her
than more corrosion at the bottom than at the top.
MR. DUTHWEILER: I think that's possibly the case because the cathodic
protection anodes are actually laying on the bottom and they should be
protecting that which they are closest to more than ~hat which is further
away. I think it actually has to be that possibly the legs are corroded as
-73-
much on top, the only thing is it has been cleaned away by the blasting
effect that occurs because of the silt in the Inlet. Now, as I say, this is
Just conjecture. This is nothing, we have no way of documenting this, as I
say this is just a condition which we found and we were trying to analyze
why it exists.
MR. MILLER: Well, I'm sure you are vitally interested and can cut
loose some deposits and bring them up and see whether they are iron oKide
or bornacles-
MR. DUTHWEILER: Yes, the bottom underneath the Inlet from ~hat the
divers tell me they actually lay flat on the bottom and scoot along and they
tell me that there is gravel and sand on the bottom and very little marine
life from what I can tell. However, again, they have no visibility themselves,
so it is just be feel~ however, we had a diver that has over 1200 dives in
Cook Inlet and he is quite familiar with the Inlet.
MR. MILLER: Thank you.
MR. BURRELL: Mr. Gilbreth?
MR. GILBRETH: I have a few other questions that hmve come to mind.
Did I hot hear that your platform was designed for 25 year life?
MR. DUTttWEILER: That is correct.
MR. GILBRETH: And I mssume there is probably 100% safety factor built
into the design originally?
MR. DUTHWEILER: I was not involved with the initial design--Brown and
Roof did the initial design work and I'm really not qualified to make that
statement.
MR. GILBRETH Just good enginemring would build in a safety factor would
it not?
MR. DUTHWEILER: I would think so.
MR. GILBRETH: Has the corrosion or the wearing that you have experienced
so far been any more than what was anticipated when the platform was designed?
MR. DUTHWEILER: I don't believe it has been. I think we have been able
to control it--to the level of the original design .........
MR. GILBRETH: In other words, through the design life we are not
looking at any danger, at least that far?
MR. DUTHWEILER: There has been some---that is true.
MR. GILBRETH: Alright.
MR. BURRELL: Mr. Duthweiler, another question. What size ~afety flare
do you believe is required, in MCF?
MR. DUTHWEILER: I believe that You have ~o~.i..really.~'ideal~...~.with the
physical layout of the flare. On the Grayling platform we have a flare which
is 90 feet long and we have flared as high as 30 million cubic feet
of gas per day through tha~ flare in,".emergency conditions. They have
handled it--the only qualification being that if the w~nd is such that it
could drive that heat back on to the plat~6rm.
MR. BURRELL: You are speaking 'of the maximum amount that could be
f~ared through that particular flare boom, aren't you now?
MR. DUTHWEILER: That is correct.
MR. BURRELL: I'm interested in the ~inimum amount, and still be safe.
MR. DUTHWEILER: Excuse me. This is my first day at the hearings I
said earlier I was out in the Inlet diving for the first part of the wee~.
Apparently a 50 barrel or 50 MCF of gas per barrel has been established for
safety reasons.
MR. BURRELL: Established by whom?
MR. DUTHWEILER: By our company.
MR. BURRELL: That is Just your opinion of what is required as a minimum
flare? For safety purpose?
MR. DUTHWEILER: For safety purposes all I can say is our company has
established this as a minimum.
MR. BURRELL: Thank you. I don't have any further questions. Does
anybody else have any questions of Mr. Duthweiler? Does anybody in the
audience have any questions of Mr. Duthweiler?
MR. GILBRETH: Mr. Chairman I have some other questions that probably
don't tie into the marketing but might tie back into some of the answers
today. Will you gentlemen be available tomorrow for questioning?
MR. MCALISTER: Yes, they will.
MR. BURRELL: I think that is all for Mr. Duthweiler then, but Mr. Marshall
has some questions of Mr. Isaacs.
MR. MARSHALL: Mr. Isaacs, I would like to request that you furnish
the Committee at your convienesce with the total volumes of fluids which have
been produced from the oil reservoirs available to be produced under your
monopod and that have been abandoned. In other words the total amount of
fluid which has been produced from your presently abandoned oil reservoirs
under the monopod. Could you supply us with those?
MR. ISAACS: Yes we could probably get those by June 4. Was that the
end of the hearing?
MR. BURRELL: We will hold the record open till Uune 4.
MR. ISAACS: We can get them by then.
MR. MARSHALL: Thank you.
MR. BURRELL: Are there any other questions of Mr. Isaacs? Thank you
sir. Is ther anybody else who wishes to testify or make a statement or ......
MR. KUGLER: I would like to ask Mr. Anderson a ~uestion. Have there
been any breaks in the pipeline from the Spark platform to shore?
MR. ANDERSON.: That would be to Mr. Cook, to my knowledge, no.
MR. KUGLER: Then I would like to ask Mr. McCamn, have there been any
breaks?
MR. MCCANN: No.
MR. KUGLER: No breaks in the pipeline from the Texaco's platform to
shore? Thank you. That's all.
MR. BURRELL: Are there~any additional questions?
MR. GILBRETH: Just for the record did either Arco or Texaco testify
as to how many lines they have to shore? I didn't recall it.
UNIDENTIFIED voICE: I don't believe they did, but we have two lines
to shore.
MR. GILBRETH: Arco has two and Texaco?
MR. M~CANN: Texaco has two 6" lines going to the Arco platform.
MR. GILBRETH: Thank you sir.
MR. BURRELL: Does anybody else wish to testify?
MR. MCALISTER: We would like to point out one thing. In the matter of
house keeping I believe you accepted only Exhibits 1, 2, and 3 into the record
and we request you to accept Exhibits 4, 5 and 6 which Mr. Isaacs refered
-77-
to. Exhibit 4 being permeability variations, Exhibit 5 being mobility
rates, and Exhibit 6 being beneficial use of gas.
MR. BURRELL: They are accepted into the record as Union's Exhibits 4,
5 and 6. Any additional statements?
MR. M~ALISTER: None.
MR. BURRELL: Is there anybody else who wishes to testify or make
a statement or ask a question? The hearing is adjourned,
::.'.LZ ~ : ...... ~'~, to ~r~J-:~~ i~mu.'_?~e~
of ~:~ order af'.~c~=~,~'' ..... ~,,~ ~e of ga~ )
il. real,cad a~ ~:e result of c~ude oil
Cook Inlet ~ ~
: ...... .,- : : ~ :--~ ~ : ~ : ..... ~.:..,: -:_:-:: :::--::: :_
C ................ ~'~ , i02
· :uu~a Kan~ Oil Pool
'~' ~'~ .... ~ "B" "C" "D"
5~k Oil Pool
· "~"~ I~C O~ ~ Pool
~A.r m':u~ R'~va r !?ic ld
Middle ' ....... ~ "G"
~,~,~:::~ Oil Pool
Hem!o~ Oil Pool -
Wes= ~oraz~u Oil Pool
SUBPOenA
¥0'3 APOS CO:::~:DZD to appear i~ the City Council ~:'oe~ of ~he Z. J. Loussac
Ai~xa, l~y 25, 26 ~
"~.~o~u:7~~? "'5<~ Av~n~ and "-~"., Street, An~..,o,:,.,,~e~ on 27 and
~--o ~ne~~r as ~na reference~
................. ~ ~' ~o gestify om behalf of ~he ~= 'of Alaska in
nay be co~,.u~.d~ -,~
...
C-AS CONSERVAT~ON COI~fITTEE
~ ~---'-~ ~ne fee for
him ~d By ~n~u~ ~o him '"
.... ~-'~~at~on of all Courts
~zeage prescribed by ~e Rules gova~n~ the ~~. -
$._?. ,fZ _:.
ALASKA OXL AND 6A~ CO~SERVATIO~ ~
~i Oil
~" Oil
~~ Oil ~1
Oil P~I
~oa Oil Pool
28, 1971, at 9:00 o'clock- A, ~,,, aad ~ long
Chai_ ~m~au
him fad by tenderin$ eo hiu ~he £ee to~' each_ da~$ atC~Ac~ne~ ~ ~he
~'~o: '~0., AL ASi~A OiL )
)
)
of ~n order affe .... ~, the us~ of ga~ )
)
?::oduced as ~2 rasui~ of crude oil )
)
)
Ccoh Inict oil fields )
Concarvation Fil~ i'~oo 105
I{CS "A"~ '~B'~ ~'-~" ' .... ' "E"
Gr~qite Point Field
Middle r~nai Oil Pool
Conse~ation File No. 103
Tr~+dlng Bay Vield
Middle Kenai "B" ~ "C", "D"
grad '~E" Oil Pools
~emlock Oil Pool
"G" ~.~ Oil
He.oak h~ Oil Pool
Conse~;ation ~_= 1,7o 104
M~rthur ~ver Yield
141ddle Kenal "G" Oil Pool
Eemlock 011 Pool
West Foreland 0il
~o ~ COii.L~{DED to appeax in the City Council G~w, be~s of ~"~' Z J Loussz. e
Libra~f, 5th Avznu2 a~d "~" S=ree~ Anchorage, Alaska, on May 25, 26, 27~ and
.... ~ so i~ag th~raaf=er as ~,e referenced
~st~f%, on u:=.,..~ of ~a Stat~ o~ Alaska in
.,.
~uppoena
I hereby return ~-ha~ % seTced ~h~ annexed
,,,~ ~d by :enduing ~o him ~h~ fee for each ~y s a~t~nd~ce ~d the
7~leaga presc=ibad by ~e R~as governs '~a ~istratio~ of ali Co~ts.
STATE OF ~J~kS~i
Re: T~E ~[OTiON OF Ti~ ~ ~'~":'^ Oll,
)
of .mn order afff~ctlng th~ ~ of gas )
p.o~ucsd ~.s tl~a rasui'~ of crude o~1
)
Cook Inl.~t oil fields )
Conzaz~ation File No o 105
Hiddla Ground Sho---~l ?ield
....· '"~',.'o "%"~ ~ "2" , "C" ~ "D" ~ ':~"~ ,
'~i."'~ m:;d "G'~ Oil
...... ,~ Oil Pool
=-rd=lc Kenai "~" "C" "D"
ann ~ Oil Pools
E~nlock Oil Pool
"C" h~ 0il Pool
Ham!oak ~'~ Oil Pool
Conservation z. zle No, 104
'~-~-'~,,.~,.~. River Field
~Kddle Kan~ "G" Oii Pool
t~.¢~ Forel~d 021 ~ooi
~n~ou,s of t/~e Z J Loussac
C61?..,Ti~ED to -appear in '~a City Council .... '",-*- ' · ·
Avenue~.,,,.,--,--~ "'P'"' Stree~, ;~orag~, Alike, on ?4ay 25, 2'6, 27, a=nd
1971, at 9:00 o'clock A. M., ~d so long thureaftar ,as the 'referenced
~*~-- beh~lf of ~e S~ate of Alaska ~
~hcsa hearings.
::,,
ALASKA OiL A/~ GAS CONSERVATION CO}~,f~TTEE
' i{cmer L. Bu~rell
i hazaby re,ufa ~a~ I served tha annexed subpoena on
and by tan~azzng to him the fee for each day's attendance ~.d the
, -.. r,,~7..;,.,-,,,,~-~),~,,:.-,,?~,;,~ r,,--.?.--,..r.--,~,-~-~,~,
'n~ .;c:'' .a h.aa~=,,5";"' to c-c.,'.-;.'-;-idc~ i~su~co
,,.~ .... ."-':.~,,,,,-~.,-.~-, "'I.,.,'- ,-~,", Of gas
)
:;roducad aa '-~he result of ct'ada oil )
~,:c:.uc:m~" .... , -,.,, :- -t ,-,..,,, ~ car=aln )
Cook iniat oil fie!dc )
Consa~ati~ File No o 105
n~.m,,,_le Cround Shoe! Field
"P" and "C" 0il P~.o!u
~,~,udla Kanaa 0il Pool
Consolidation File i.io~ 103 ~
Hidd!e K~nai :'"" "C" "D"
and "E" Oil Pools
i!anlock Oil Pool
'~",= *~.,a Oil Pool
Y'~.-~ ~"~-~ "G" 0il ~ "
H~lo~¢ Oii Pool
0~ Pool
Was~ Foreland '"
~.~, ~ ~ ~
~-~'."~= of ~,~e S''~'~ of Alaska in
kfi~ and by tanda'-'-".~,o to him ~'~,,e za,~ ~ for e~h say's' oFfend.anco and the
.., '-"- - of ~l
:'iiaage p~-csc.~ed by the P.u!~s gov~g ~.ha a~,~t~ratic~ Courts.
~J~ _,~ - - .==.- u'-:::_ ~_ ' .....
Tuavci ~
~ ..... ;~ .
To~ $ ...~/._ ~
~: ~'S KO'f :ON OF ~.,.~Z ALAS}~ OIL
AUD GAS '*~"~'~'~*'~ ~ ....
Cook l~t oll fioida )
~,aaai Oil Pool
"D"
Oil Pools
Oil Pool
fior~ation Fi!a No. Riva'r
0~_ Pool
Forel~,d Oil ?ooi
TO: D--iLE TEL~
YOU A?2{ COi_~',T~"D to appear In ~u City Couucil ~,~z, bor~ of tho Z. J. Loussac
Lib ra~y ~ 5th
2,~, 1971,
STAT~ OF
Rm: TI~ MOTION OF ~ ALASKA OIL )
)
AND GAS OONSERVATION C014~TTEE to )
)
hold a he~g ~o c~tde~ iss~ )
of ~ or~r ~fect~S the ~e of S~ )
produ~d ~ ~e result ot c~ oil )
)
prod~ ~rati~ ~ ce~ah )
C~k Inle~ oil ileMs )
Middle K~ "B', 'C"
He~k 0~1 P~i
"~" ~ Oil ~1
t~~ '~ Oil
C~~a~t~ ~ile No.
~dae la '0" Oil
~t Fo~d Oil P~I
SUBPOENA
TO: JOHN BERF, QUIST
YOU ARE CO~BD to appear t~ the City ~~1 Chars of the
Z. J. Loussac Library, 5~h Avenue and "F' Stree~, Aneho~e, A~aska. on
~ay 27 and 28, 1971, at 9:00 o'clock A, M., and se ~ ~hereai~.er a~
the referenced hearings may be conztnued, to testi~ on behalf of the
State of Alaska in ~hese hearing.
I hereby re~urn t~al: I served ~ mu~xed subpoena on
~m ~d by te~eri~ ~o him ~ ~e for eaeh ~'s a~~ ~ ~e
~~e pe~cribed by ~ ~s 8~e~i~ ~ ~i~s~ati~ of ~1 Co. ts.
Service ~ees
AFFIDAVIT OF
PUBLICATION
STATE OF ALASKA, )
THIRD JUDICIAL DISTRICT, ) ss.
..... Xar.y...L..£~ke .....................
being first duly sworn on oath
She
deposes and says that ................
Legal Clerk
is the ......... ,:. ....................... of the
Anchorage News, a daily news-
paper. That said newspaper has
been approved as a legal news-
paper by the Third Judicial Court,
Anchorage, Alaska, and it is now
and has been published in the
English language continually as
a daily newspaper in Anchorage,
Alaska, and it is now and during
all of said time was printed in an
office maintained at the aforesaid
piece of publication of smd news-
paper. That the annexed is a true
copy of a .... .L..e..g~.l....N..g..t..i..c...e....8. O39
as it was published in regular
issues (and not in supplemental
form) of said newspaper for. a
period of ---gne ........ insertions,
commencing on the ............ day
of ...... ,."~.p.z?.:i_.~ .... i .... ,19 ...7.1, and
ending on the .... 2J.4 ........... day of
of ....A..,. przll ............................ , 19. 71,
both dates inclusive, and that
such newspaper was regularly
distributed to its subscribers dur-
ing all of said period. That the
full amount of the fee charged
for the foregoing publication is
the sum of $ 17.25 which
amount has been paid in full at
the rate of 25¢ per line; Mini-
mum charge $7.50.
Subscribed/~d sworn to before
//
me this .~..~.. day of..XDn±'l ........,
19'7Z-' ,....~ /:
........
.....
Notary Public in and Vrd'r I 1
the State of Alaska,
Third Division,
Anchorage, Alaska
( x~Y COMMISSION EXPIRES
..... ...... 2/...., ,
, Voir,,
] 2. ',Wit,1 : the, ~l:arlr~g'..or ven¢ing
~ :,: ~stn'ghead~:.~,~,;ia~er ;Tune",30; 1972J
t,n, e,xcez,a '~t~:~ou-~ requi,~ed J
:',,,"waste" ~ def~$d'
;, , ,
NOTICE OF PUBLIC HEARING
STATE OF ALASKA
DEPARTMENT OF NATURAL RESOURCES
Alaska Oil and Gas Conservation Committee
Conservation File No. 103
Re: Trading Bay Field
Middle Kenai "B", "C", "D",
and "E" Oil Pools
Hemlock Oil Pool
"G" NE Oil Pool
Hemlock NE Oil Pool
The Alaska Oil and Gas Conservation Committee will hold a hearing pursuant
to Title 11, Alaska Administrative Code, Section 2009, to consider issuance
of an order or orders, effective .July 1, 1972, restricting the flaring or
venting of casinghead gas from the referenced oil pools to the amount required
for safety.
The hearing will be held at 9:00 A. M. May 27, 1971 and so long thereafter
as the hearing may be continued, in City Council chambers of the Z. J. Loussac
Library, 5th Avenue and F Street, Anchorage, Alaska, at which time operators
of the referenced pools and affected and interested parties will be heard.
Evidence will be sought as to, but not limited to, the following:
1. Can excess casinghead gas be marketed, injected into any reservoir or
pool, or otherwise beneficially utilized by July 1, 19727
2. Will the flaring or venting of casinghead gas after June 30, 1972 in
excess of the amount required for safety constitute waste, as "waste"
is defined in AS 31.05.170(11)?
3. Will more waste be caused than prevented by an order restricting
production of oil to a rate whereby all produced casinghead gas is
beneficially utilized or is required for a safety flare?
Thomas R. Marshall, Jr.
Executive Secretary
Alaska Oil and Gas Conservation Committee
3001 Porcupine Drive
Anchorage, Alaska 99504
Publish April 24, 1971
Nr:: Iii ,,~,,~l:.:rlc,lll Ploch. lcir~q Divi::ioiI
Norttl J~,l.lspr, Dis!riot
PostOlli~[ 'ox 360
Anchor;.,(;_. Al~:ska Or.'.531
Telephonic 907 277 5637
March 2', 1'971
blobil Oil Corporation
P. O. Pouch 7-003
Anchorage, Alaska 99501
Attention · Mr. V. B. Porter
Re: Gas Supply Contract
Gentlemen:
This letter will constitute an agreement between Atlantic'
Richfield Company, herein referred to as Purchaser and
Mobil Oil Corporation, herein referred to as Seller, by
which the Purchaser agrees to purchase, and the Seller agrees
to sell a certain quantity of gas. Subject to Purchaser's
acceptance and the conditions set forth herein, the Purchaser
and the Seller hereby agree as follows'
·
1. Purppse Purchaser as operator of the Spark Platform
in the Cook Inlet has need for a supply of natural gas
to be used on and appurtenant to that Platform. Seller,
as operator and part interest owner of the Granite Point
Platform has available from time to time at the Granite
Point Shoresite certain surplus quantities of casinghead
gas produced at that Platform. It is recognized by both
parties that this quantity of gas is dependent upon crude
oil product~.on and is therefore interruptable at any time.
Upon and subject to the provisions hereinafter contained,
Seller hereby agrees to furnish and Purchaser hereby .agrees
to Purchase such available casinghead gas under the
conditions and stipulations hereinafter set forth.
.,.
2. Quality It is understood and agreed that the. Seller shall
not in any way be responsible for the quality of the gas
delivered hereunder.
$. Contract Pressure Seller will deliver gas to Purchaser
at the point of delivery under a pressure of not less than
250 pmmds per square inch'gauge.
4. Lower Press~res If at any time Seller, due to equipment
failure, maintenance or other reason or reasons, cannot
deliver gas at the contract pressure and Purchaser has need
for and is desirous of taking gas at such lower pressures
and in such q~}antities that Seller can and is willing to
deliver such gas, then Purchaser may take quantities as
are so available unt.i'l Seller 'is again able to make gas
available at contract pressure and quantity.
Mobil Oil Corporation
- 2 - March 2, 1971
5. Delivery Point Ail gas sold hereunder shall be delivered at a
mutually agree2blc point at or near thc Seller's Granite Poi~tt
Shoresite facilities.
6. De.l~ve_ry Eq~[ir, ment Purchaser shall provide, install, maintain
a~:d operate a~ ]tis own risk and expense, at and beyond zhe point
of deliver)-, such lines, eciuipment and appliances as are necessary
and suitable to measure and further transport delivered gas. To
the extent necessary for the purposes hereof, Seller hereby grants
to Purchaser ~ermission to locate such lines, equipment, and
appliances at and beyond the point of delivery to'the extent, ..and
only' to the extent, that Seller has' the right to do so and that-
such will not unreasonably interfere with the Seller's rights to
such premi, ses and only for so long as this. agreement is in effect.
7. Price Purchaser shall pay to Seller on a monthly basis for all
gas delivered at contract pressure hereunder at a price of 15 cents
per thousand cubic feet and for all gas delivered at less than'
contract pressure a price of 6.2 cents per thousand cubic feet.
Gas which is taken by Purchaser which is not compressed by
Seller shall be deemed to be gas delivered at less than contract
pressure. Volumes so delivered shall be computed on a pressure
base of 14.65 psia and at a temperature of 60OF.
8. _Quantities Commencing as of the date of the first deliveries of
gas hereunder which shall not be later than 10 days after Seller
gives tvritten notice that it is ~villing and able to make deliveries
of gas in accordance herewith and continuing during the term hereof,
Seller shall sell and deliver to Purchaser from Seller's properties,
and Purchaser shall purchase and receive from Seller from said
properties and pay for, or pay for whether or not received, during
each month, a minimum of 600 b~CF of gas per day. In addition,
Purchaser shall have the right to purchase and receive from Seller
during the term of 'this agreement such other quantities of natural
gas from said properties in addition to said minimum as Seller can
and is willing to make available. Such minimum daily quantity.
shall be averaged over each month. An), days that gas is taken by
Purchaser under paragraph 4 hereof and any days that gas is not
available at cont'ract pressure and quantity, such days or parts
thereof shall reduce the amount of days Purchaser is required ~to
take or pay for gas not taken under this paragraph and Purchaser
shall pay only for such gas on those days as actually taken in
accordance with paragraph 7.
c.... o./03
Mobil Oil Corporation
- $ - March 2, 1971
9. Title and Indemnity All gas sold and delivered hereunder shall be
unprocessed and unodorized raw casinghead gas and it is expressly
understood and agreed that Seller hakes no warranties or represen-
tations as to itt, f4tnc::,s or suit ..... . ,~ .
' . .... - ~..,,i~ztv for anv l,t, rpose The title
to and the control of sa::~e sl~:til pass to and vest entirely in
Purchaser at t;~e point of de!ivery. Accordingly, i2 shall there-
after be Purchaser's sole responsibility to prepare said gas to make
it suitable for thc purposes to which it is to be applied. ' It is
accordingly expressly agreed and understood that (a) all gas sold and
delivered hereunder shall be delivered by Seller and accepted by
Purchaser as is, without warranty as to merchantability or as to any
other manner whatever, express or implied, and Cb) Purchaser shall
indemnify and save Seller harmless from any and all claims, demands,
losses, damages, suits and/or judgements of any kind that result from
acts of co~ission or omission .done or caused by Purchaser within
the scope.'of this agreement.
10. Term This agreement shall be for a term 'of 90 days from the date
as-of which Purchaser accepts this agreement and thereafter until
cancelled by either party upon S0 days written notice.
11. Assignments
of Seller.
This agreement is not assignable without written consent
12. Intent It is the intent of parties hereto that prior to the expiration
of 90 days from the time that this agreement becomes effective, the
parties will enter into a contract for gas sales and purchases to
cover a period of at least five years from the effective date of this
agreement. Such contract will provide for delivery of gas at pressures
of less than 50 psig or as provided for in paragraph 8 hereof.
If this letter expresses your understanding of our agreement, please cause
an authorized representative of )'our company to sign in the space provided
· below and then return one fully signed copy to the attention of Mr. Bert R.
Brown of Atlantic Richfield Company.
Very truly yours,
ATLANTIC RICIIFIELD COMPANY
Bert Il. Brown ~.-..
District Landman
Agreed to and accepted this 2nd
day of March, 1971
Norll] Am~;ric;i;~ l"rorlucin9 Divt'.~iotl
,
No~lh AI~' '~ Dislric;~
Post O{li~c Box 350
Anc~oragc. Alu~ka ~gSOl
T~l~phone 907 277 553 ?
March 2, 1971
Union Oil Co:npany of California
Union Oil Building
909 West 9th Avenue
;mchorage, Alaska 99501
Re' Gas Su?ply Contract
Gentlemen'
·
This. letter will constitute an agreemenxc between Atlantic
Richfield Company, herein referred to as Purchaser, and
Union Oil Company of Califo~mia, herein referred to as
Seller, by which the Purchaser agrees to purchase, and the
Seller agrees to sell a certain quantity of gas. Subject
to' Purchaser's acceptance and the conditions set forth herein,
the Purchaser and the Seller he. reby agree as follows'
1. Pur~ Purchaser as operator 6f the Spark Platform in
the Cook Inlet has need for a supply of natural gas to be
used ,m and appurtenant to that Platform. Seller, as
part interest owner of the Granite Point Platform, has
available from time to time at the Granite Point Shoresite
certain surplus quantities of casinghead gas produced at
that Platform. It'is' recognized' by both parties that this
quantity of gas is dependent upon crude oil production and
is therefore interruptable at any time. Upon and subject
to the provisions hereinafter contained, Seller hereby agrees
to furnish and Purchaser hereby agrees to purchase such
available casinghead gas under the conditions and stipulations
hereinafter set forth.
2. _Quality It is understood and agreed that the Seller shall
not in any way be responsible for the quality of the ga.s
delivered hereunder.
3. Contract. Pressure. Seller will deliver gas to Purchaser at
the point of delivery under a pressure or not less than
250 pounds per square inch gauge.
4. Lower Pressures If at an), time Seller, due to equipment
failure, maintenance or other reason or reasons, cam]et
deliver gas at the conti'act pressure and Purchaser has need
for and is desirous of taking gas at such lower pressures
and in such quantities that Seller can and is willing to
.deliver such gas, then Purchaser ma)' take quantities az
are so available untfl Seller is again able to m~d;e gas
available at contract pressure and quantity.
Union Oil Compaq,/
of California
- 2 - March 2, 1971
S. Delivery Point · All gas sold hereunder shall be delivered at a
mutually agreeable point at or near the Seller's Granite Point
Shoresitc facilities.
6. Delivery Equ~_j~ment Purchaser shall provide, install, maintd'in and
operate at his own risk and expense, at and beyond the point of
delivery, such lines, equipment and appliances as are necessary and
suitable to measure and further transport delivered gas. To the
extent necessary for the purposes hereof, Seller hereby grants to
Purchaser permission to locate such lines, equipment, and appliances
at and beyonc[ the point of delivery to the extent, and only to the '
extent, that Seller has the right to do so and thkt such will.~not
unreasonably interfere with the Seller's rights to such premises and
on. ly for so long as this agreement is in effect.
7. Price Purchaser shall pay to Seller on a monthly basis for all
'gas delivered at contract pressure hereunder, at a price of 15 cents
per thousand cubic feet and for all gas delivered at less than
contract pressure a price of 6.2 cents per thousand cubic feet'.
Gas Which is taken by Purchaser which is not compressed by Seller
shall be deemed to be gas delivered at less than contract pressure.
Volumes so delivered shall be computed on a pressure base of 14.65
psia and at a temperature of 60OF.
8. Quantities Con~nencinj as of the date of the first deliveries of
gas hereunder which shal.1 not be than 10 days after Seller'~'J''
gives written notice that it is willing and able to make deliveries
of gas in accordance herewith and continuing during the term hereof,
Seller shall sell and deliver to Purchaser from Seller's properties,
and ?urchaser shall purchase and receive from Seller from said
properties and pay for, or pay for wh. ether or not received, during
each month, a minimum of 200 MCF of gas per day. In addition,
Purchaser shall have the right to purchase and receive from Seller
during the term of this agreement such other quantities of natural
gas from said properties in addition to said minimum as Seller can
and is willing to make available. Such minimum daily quantity
shall be averaged over each month. Any days that gas is taken. ~)'
Purchaser under paragraph 4 hereof and any days that gas is not
available at contract pressure and quantity, such days or parts
thereof shall reduce the amount of days Purchaser is required to
take or pay for gas not taken under this paragraph and Purchaser
shall pa}' only for such gas on those days as actually taken in
accordance with paragraph 7.
Union Oj. 1 Company
of California
- 3 - March 2, 1971
9. Title and Indemnity All gas sold and delivered hereunder shall be
m~processed and unodorized raw casinghead gas and it is expressly
understood and agreed that Seller makes no ~,;arranties or represen-
tations as to its fitness er suitability for any purpose. Thc title
to and the control of sa'"~ .... ~ shall pass to and vest entirely in"
Purchaser at the point of deliver>'. According/y, it shall there-
after be Purchaser's sole responsibility to prepare said gas to make
it suitable for the purposes to which it is to be applied. It is
accordingly expressly agreed and'understood that (a) all gas sold and
delivered her-eunder shall be delivered by Seller and accepted by
Purchaser as is, without warranty as to merchantability or as to any
other manner whatever, express or implied, and (b') Purchaser shall
indenmify and save Seller harmless from any and all claims, demands,
· losses, damages, suits and/or judgements of any kind that result from
acts of con~nission or omission done or caused by Purchaser within
the scope of this agreement.
10. Term This agreement shall be for a term of 90 days from the date
as of which Purchaser accepts this a. greement and thereafter until
cancelled by either party upon 30 days written notice.
11. Assignments
of Seller.
This agreement is not assignable without written consent
12. Intent It is the intent of parties hereto that prior to the expiration
of 90 days from the tim~ that this agreement becomes effective, the
parties will enter into a contract for gas sales and.purchases to
cover a period of at least five years from the effective date of this
agreement. Such contract will provide for delivery of gas at pressures
of less than 50 psig or as provided for in paragraph 8 hereof.
If this letter expresses your understanding of our agreement, please cause
an authorized representative of your company to sign in the space provided
below and then return one fhlly signed copy to the attention of-Mr. Bert R.
Brown of Atlantic Richfield Company.
Very truly yours,
ATL,%YTIC RICHFIELD COMPANY
°
~ert k. Brown
District Landman
'Agreed to and accepted this 2nd
day of ~hirc]l, 1971 ' '
UXiON OIL CO~,IPANY OF CALIF~iINIA . : ~ :
c.o. lo2
2G03 ARCTIC BOULEVARD
ANCHO,qAGF, ALASKA .99503
·
GAS ANALY~S,,~,n":~:'~'r.'"r,.,,,,
C0,'r0r.,an 5iobil Oil Corporation
Well No._.~.,,_Q)-'_~.al_!.itc Point Platform
Field._ Granite Point
CounW__._.~
5:'ate A~. as'ka.
Date Februa~'y 13, 1971 Lab. ~o. A-822-i
Location__ Coop¢~:. Co. mp. zes$gr system
Format[on__ .
Depth ......
SampJing point____Sucti°i~ scrubber
L,r',:: pressure_~._-___psig; Sample pressure__40 psig; Temperature__72- "' F; Container number.~ 28
Rcrnarks ...... aat~lg.%,Q_:L_'al£e_n~F~a_ry 11_~ 1971 by yw, .Carl 0.__ Pawlisch.
Component
Oxygen .
Mole % or
Volume %
0
Nitrogen ......................................................... ..... ................ 1.,87
Carbon dioxide .................................................. ;'...'.i; .......... O. 15
Hydrogen sulfide ................................................................ -
·
· --' 75 30
Melhane ..........................................................
Elhane ........... . ............................... : ........................... i..'~... 8.70
8 ~3
Propane ...................................................... · -. ....... .., ......... ·
iso-butane .................................................................................... 1. G0
N-butane ..... ' .................... · .........................................................
Iso-pentane ................................................................................. . 0 ._5_1
N-pentane .......................................................................... O, 50
Hexanes 0.44
Total ......" . ............ ;LO0., O0 _
par MCF
2.258
0' 522
0.793
_' o_,3_&%___
_ . q_,3.,~_O__
_ _ 0..._0_8 3 _
4.203
GPM of penlanes & higher fraction ..............................................
Gross btu/cu, ft. @60° F; & 14.7 psia (dry basis) ...: .....................
Specific gtavhy'(calculated from analysis) ................ - .......................
,Specific grav;ty (measured) ............................................................
Remarks:
0.630
L329
0.780
0.779
c.o/03
TRADING BAY OIL FIELD
Cook Inlet, Alaska
OIL AND GAS PRODUCTION, JANUARY 1967 THRU Pt~RCH 1971
O~-~lPool
Oil
Estimated Value Based on
Cumulative Production Payments for Royalty Oil
(Thousand Bbls..) . _ _(Thousand Dollars)
__
Hemlock 4,298
Middle Kenai 13,366
"G" N.E. & Hemlock NE 8,365--
TOTAL 26,029
$63,040
Produced Utilized Flared
mC~) _ mCF) ~ mCF) ,.
(z)
4,319,977
12,924,798 *
_2~0.65,002
19,309,777 * 2,114,437
11.0 17,195,340 *
89.0
* Includes 863,829 MCF Produced & Flared Dry Gas.
.-~.~ ACCEPTED
Date
ALASKA OiL. c,.--~!
CONSERVATION C-:L~;-'~,f-./,'i 'TSS
~,,, ~e~ EXHibiT~. ~l .,
C,O. FILE
TRADING BAY OIL FIELD
Cook Inlet, Alaska
CALCULATED VALUE OF GAS FL~
ACCEPTED
ALA~ ~ ."'
CON S Ei~;:V',",':- ,"~ C "',',:',"'iiTTEE
RED
c.o. rote
Basis: Heat Content
Heat Value of Gas - BTU/CF
Heat Value of Oil - BTU/Bbl.
Volume (CF) Gas Equal to One Bbl. Crude (Heat Basis)
1,033
5,861,416
5,674
Current
Gas Flared- MCF/D (March 1971)
Heat Value of Gas Flared - Billion BTU/D
Oil BTU Equivalent to Gas Flared - Bbl./D
Average Price of Oil - S/Bbl. (March 1971)*
Dollar Value of Gas Flared- $/D (March 1971)
15,712
16.230
2,769
$3.055
$8,459
Future
Future Estimated Total Gas to be Flared - MMCF **
Oil BTU Equivalent to Future Gas to be Flared - Bbl.
Dollar Value of Future Gas to be Flared
27,458
4,839,267
$14,783,961
* Field Crude Oil Posting at Pipeline Connection as of 3/31/71.
** Gas Volumes from Operators' Exhibits submitted for Conservation
File No. 100 on March 4, 1971.
-70
KE;UFFEI. & E:~$ER CO,
ALASKA PIPELJ_NE 'COMPANY
ANNUAL GAS SALES HISTORY 8~ FORECAST
/
'
!
/
/ ~. ;~,?,o.. j.
:~ 9c4
rs. zvv~ ~ ~04 J
I
I
u.5!t~'.' T 9 N R ~3W
I
t
I
!
I
I
!
I
-EXHIBIT I .....
Atlantic R ich fieJd Company
Trading Bay Field Hearing
May 27, 1971
Location of "G" & Hemlock N.E. Pools
j " ' IIJ_. . ' J ' I_ '
I
'" .L ~ ~ - :
·
I
·
·
· :
35
I
I
I
I.
!
I
I
I
I
!
I
i
I
I
I
1
Prediction
90~
7no0
6~
5000 !
4000['
/
i
t
1
~o,~ ~
I
1
I
i
I
I
I
HISTORY
I
I
I
I
PREDICTED
k I
i
, i
!968
1969
1970
--, --,
-, , i
i t ~ t I
! i ! ,
I I i I i
~1 1972 ~ 1973
FUEL
I
i975
"
i EXHIBIT .3
I Aflo n';'ic Rich field Corn pony
[ Trading Boy Fiel
! P,u~',o,m ,.,:.,.~,.c~
,[...I a] :< ~ ~1 * II 1 ~ i , i I I ~ I ,
,i lei t¢I ~ ¢ ~~ II t I t ~ , I ~ , ~ I I
Il ' [ I J t t ' '
-~ ..... :2 _. % I .
' '~ t --[------i --' ' "I.~ ' ~cTEDI 1, ,' i I i ~ i i-
I I ! i I I i ?F i r~x~¢,¢-,,,',,z¢¢¢¢¢.~- 0, ¢~,:~¢:x; I I I
' ~ ! /n ~ I~~'' ~ I i , ~ i i I
i ! Hi ~ t ~ ! ' i ! ! , ! ~ "
4~,n, ...... / It~_r ~ · ' ~ '
','~ i -l-f ...... ~ t ' ' t ' F i ! i t~~~ t
· ' ~ ~ I , '
i I i ~ I , ~ J
0 ! ~.~ . ~. ! [ I I I .i . I ~
j'Iq68~ ~' ~a6S _~J~S70.._ 1' j~7~. 1~ ~aTa~ ~ 1 ~73j 197~- ..... 1975 1976
9OO0
--- 80GO
;7COD
6OO0
5OO0
4O0O
· 30OO
2OO0
10OO
o
EXHIBIT I
UNION OIL COMPANY OF CALIFORNIA
T~ADING BAY FI['ED
z PRODUCED GAS & GAS BENEFICIALLY REUSED
F'.~.",..--7~::T--~T-:":-.-F:"7-.T'~!T"T-': .... :, ti ....... . ............ i': .... :". ' '.. .,.. : : . : , .! .
fi:ii :::. L.., :. ..!.. i:'- ',~,,,t. 'i .' .: ' . .. ,!...I : .' !' .- : . : ..' .......... '.: ...... ' ....... ' , - ':.:
/ .... t' .~ ..... I ., ,t 'I " I,~.n''' ~ ' ' ' ; ' ;' ; ' : '. ......... ' " ..... : ......
~, ............. [ ~ ...... ~-.-' I~ , ........ I ...... , ..... "' ' 't ........ ; ' ~ ' ' ' ' ' ,t '
......... ~t .............. [ ~ o< ~ , ] ~ .... ..... - ............................... 1
---"" -~"' · ~ ............. t i ........ '- ....... i ...... ~ .: ............. . ,: ...... ,, '~ ....! '"r ......... . ' " ; .
L, ~"' J. I "" .......... ~. ..... ; -| ....:, .... I ........ , ...... ;' , !. :-. ,'"'j''': ~ 't! .... ,i ..... '' : .... ':' .' ' '': '' ', '
I ;:': :: :: :I: :. .''.'~ ' , . .,I.. '~ 1' . ' '- ! ' ; ' '': ' : : ' :' '~ 'J ' ";' ' .....
t :::::t:; ~.';[ "::, ".i. ".'.:.. /'"4 I.i 'I . i ~ :';' ~': ", ' "' '" '
zoc~oo[ ....... : ............... ' ........ ~ ..... : ..... ~'-:'-;~ .... t t,',/"l- · .i-.~ ' ~'-,t,~,. ,~ ' ' "'.,' .... :' , 'i ' ' ' : . ': : " , · · "' ' ' :;::":'i '
' ,~:'.i; ;, TOTAL GAS~ ~- ./ ,I i ', ', ~ ,7"...' · ' · ' "' ';' ' , ' ' ' ' '
t-':-~-;-.:~:..:.-:'::'"oouc'r'o'"',-: ~ .. . ' '.~ .'. i"~..~. ~C:XL.%.,s,:' 0,:~s 't. : 'i '."':' i'"' '."'." : : ..... i ....... :"'. '"::-::'"':'::ii
[:;; ; : ....... t~h .:'~,,/'~i' PLUSGAS SHPPED TO ; ' ' ' ' ' i ; ........ ! "
I:',:;; :', :,i::I:::' SHORE (.'- "· ' ' ~" .....
0000 I- ........ -" .......... + ........ , ' , I ,
~ '~. ; ', ,. I ; , ' ' .
["-'"t ..... ~. ........... 4...,, i, I ...... ' ' ' ' '
............. ~NEW BENEF C AL REUSE OF GAS ' ~ .... '_'~,' : . .' .
. , ': ' :' ' ...... ; ~ ti~ .... .-~-T' 1 '
/! :. '.. ,... '. .... :.
,4000 [ ..... V' : . : '
: ' ' i' . ' .
: FORECAST
.... ,'.. i '. ~ , . . .. . !-..'. . ~ . ~ .............. : .... :-r,:~t, , , .... ,"i
..........
' ..... .: : '-!'N'. :' :7,'.' i' "' '.i ''
[.. .................. ~ ..... ! ..... , ; . . I . ', , r i .... I~* ..... ~ ..... ~' ' ...... t
[. [ I I?: ',: ' ' ., ~ [ : .. _: .... I ........ '::.:. ' ;~ :. ~ -. :i '. ::'. ', ; -. : ,
400.[ ..... t l ....I~' :':,":'t ...... :' l ":'": ) ': ....... : ......... i: . ,, ' ' ' ....... i ' ~ ' ' '
I,, [ .... t ·
~oo t ...... t :':"i ...... ....... t .............. ~ ' ~ ...... '~ ..... ' .... : .............
. .
74 ~ 75 76
77 78 79 80 8 82 -"8'3' ,~ 84
·
, ,
'rTA FAULT BLOCK
R,~W
TS-2
'I
A-18
. A'
I
!
I
I
!
I
I
I
I
!
II
I
I
I
!
!
I
I
I
I
!
!
EXHIBIT
union
TRADING BAY FIELD
T~ C- 7 ~0
! C Z~)
MSL "~
~ENTFR
MONOPOD
:5000 -
3200 '-,
~o'o.~
msoo~
4000-'{
42OO ~
4400~
4600"'
4800~
520O i
$600i
',.,'r' POOLS \
1TA FAULT BLOCK
//../// //'" (~ ....
/
/'
- ~-~ - ......... _----:::-~--:z':-CZ~::~--~-~: ....
A-24 A-19 A-i6 A-8 -
TMD 9190 TMD 9259 TMD 7460 TMD 7083 TMD 6669
TVO616~ TVD6886 TVD6515 TVD 6§20
.. ,.
-, ACCEPTED ..
Dote,
CONSERv:AT~'O>~ C :2:ivtlTTEE
~XH~T
~ C.O. FILE
TVD 6457
200 E×H II~IT ZI~
I FEET STRUCTURAL CROSS SECTION A-A'
o~ 2~O 'C' POOLS S*~NDS
EXHIBIT IV
PERMEABILITY VARIATIONS
FROM SANDSTONE CORES AND SIDA~ALL SAMPLES
MIDDLE KENAI AND H~NLOCK FORN~TIONS
TRADING BAY FIELD, COOK INLET, ALASKA
SAND
N~{BER
OF
S~2,!PLES
MINIMUM MAXIMUM MEDIAN
PEP~EABILITY PERMEABILITY PER~IEABILITY
(md) (md) (md)
.
STANDARD
DEVIATION
VARIANCE
C-1
C-2
C-3
C-4
C-5
C-6
C-7
47-5
49-4
50-3
50-6
51-6
53-0
53-8
54-5
54-9
55-7
56-1
57-2
58-1
58-7
60-0
60-5
61-1
HEM
2
2
lO
2
1
0
3
5
2
17
31
17
1
6
99
27
14
12
28
141
lo
T
1.3
4o
4.8
4.9
79
2.7
42
74
14
6.7
.99
.1
'402 27
266 72
489 12
901 103
38 , 34
494 141
lO90 457
20 7
1.3 1.3
452 209
265.2
107.7
337.3
389
5.03
249.6
369.6
9.2
0
148.9
310 240 140.1
230 31 102.7
182 58 66.6
907 54 411.9
104 79 17.7
312 84 113.1
1260 209 394.0
717 226 183.2
413 125 150.0
217 45 84.1
428 38 97.3
· 99 .99 0
266 62 108.,.
925 48 137.8
16.3
10.3
18.36
19.73
2.25
15.8
19.22
3.0
0
12.2
11.84
10.1
8.16
20.29
4.2
10.64
19.85
13.5
12.24
9.16
9.86
0
10.4
VAI/afw
ACCEPTED
Dot
~'~, i ~% ~'-"' "> ~ '" ..... ,...
C,O. FILE ~ ,.,/J
EXHIBIT V
MOBILITY RATIOS
TRADING BAY FIELD, COOK INLET, ALASKA
MOB I L ITY
RATIO "C" POOLS "D" POOLS HEMLOCK
Water-Oil Krw~o 2.266 .854 1.07
Kro~w
Gas-O i I Krg~o 19.06 5.556 13. 787
Kro~g
SOURCE OF SPECIAL CORE DATA
A. 17 A-16 A-lO
SOURCE OF SATURATION DATA
Foot by Foot Log Analysis
GAS SATURATION VALUES WERE PREDICTED FROM THE MODEL STUDY
VAi/mgl 5-25-71
PLATFORM
ONSHORE SITE
EXHIBIT VI
BENEFICIAL USE OF GAS
TRADING BAY FIELD, COOK INLET, ALASKA
ITEM RATED HP
G398 Caterpillar 1950
Solar, Turbine, Injection
Pump 2160
Solar, T.urbine, Generator 1080
Cleaver Brooks Boiler 40
Worthington Gas Compressor 1890
Sales Gas Glycol Reconcentrator
Waterf I ood Deaerator
Average Daily Consumption
Solar, Turbine, Generator
Solar, Turbine, Injection
Pump
Line Heater
Heater Treator
Average Daily Consumption
CONSUMPTION
MCF/D
400
5OO
250
200
250
2
I
1200
2160 500
2160 500
I00
' 200
I100
.LIQU. I D EXTRAC.TIO. N,,PLANT
Shrinkage
200
TOTAL AVERAGE GAS UTILIZATION
2500
VAI/mgl 5-25-71
2422 BARTL~'
HOUSTC~ N, TEXAS
·
(713) 528-5519
(713) $24-3939
i i
i
A. Open (1), Close
TO LAUNCH
Open (3)~
Open (2)
Close (1)
,
.A.
B.
C.
V
· ,
!
I
HAL
CATOR
~G
DynaSedl 370
through 42" bore
~50' F. maximum ~
., -~ ;.-~ ~ '
· :~~ ~ ~ ~ TI ~ ~ /~ STEM RETAINER / ~ SEAT FACE SEAL
.~: ~ ~ ~- ,.; ~ .
:' ~ ' -- ~' ~,. '/ · ~" ~ ../5'~ [': '~1 t ~ d '~ / ~ I % ,~* ' &.~'~,,,, ,~
' ~ ,' : ' ~'~ ....
.... . ..... ~ ..... .~,. ;, ,, ,,~ ....
................ -'" ..... ~ :.~, ,',, "~I'~I ~' "T~"'"'- ....... ~ ................. '~' : '.'~ ..................~'"' .....
~ _.:L ............. ~.
"-Ifi~ ................ ...... ':.:.,, '"".,-.'=:~ .... ::~:' ....... ~:::'=::'~;=.'~.~,~ '.':.-:-~,:~',, --:':u~..-',:-.:,:.:.;:-_ .......
~,' ,,..,,~ ' .i ~ T . .t'_':.J.'] .... ;~ ......
.,~
. ,,,,:ii[ '"
. i .... .... ii.': ...- .:~:.i::ii~ :~.. ........ :'_.,:~'!. ;.. '":~:, ............... s~:::_.a.....~:~:,
..... -~E.~...:.~ ,.~ i~. ....... t:'::': "~E..--.."q_~L--.: ..... .. :.c'7'..'.? .. ..... :~.~_ ............. :-: .:~._.~.~.~,,7_~r~
...... ~ ..... -~%, --.,-~.
~ ,,~ ~ ~ .~..~...!. '"~"~-'
TRUNNION B£ARING':.. . ~'~ ~--
'"TRUNNION STOP PIN ' ~ '~''' ,~(;OV£R
Operators
"The 'I)ynaSeal 370 bah valve is
equipped adth a wrench operator as stan-
..~lard..in.2-..through 4-inch bore sizes, and
with 'an enclosed gear operator in all
]_n_rger sizes. Pxacticaliy any type of power
actuator canbe supPlied as required. For
'buried or otherwise inaccessible valves,
stem extensions can be supplied ~n 6-inch
Jem.~-_~ .increments.
PLATE DOWEL PiN
COVER PLATE
Easily Serviced
The DynaSeai 3?0
valve is easily .ser-
viced, and should it
ever 'be necessary,
can be completely
disassembled in the
field for repair or
.:parts replacement.
