STATE OF ALASKA
ALASKA OIL AND GAS CONSERVATION COMMISSION
3001 Porcupine Drive
Anchorage, Alaska 99501
Re:THE APPLICATION OF ARCO
Conservation Order No. 432
Alaska, Inc. to change Rules 8 and 9 of )
Kuparuk River Field
Conservation Order 173 regarding
Kuparuk River Unit
pressure and production profile surveys. )
Kuparuk River Oil Pool
July 22, 1998
IT APPEARING THAT:
By letter dated May 11, 1998, ARCO Alaska, Inc. ("AAI") requested changes
to the requirements of Rules 8 and 9, Conservation Order 173. AAI requested
Rule 8(b) be changed to eliminate a specified number of pressure survey,
Rule 8(d) be changed to require pressure survey reports annually rather
than quarterly, and Rule 9(c) be changed to require productivity survey
reports annually rather than quarterly.
The Commission requested clarification of the application on May 21, 1998.
The Commission published notice of opportunity for public hearing in the
Anchorage Daily News on May 23, 1998.
AAI clarified and corrected their original request with a letter dated
May 28, 1998.
The Commission received no protest or request for public hearing.
Various conservation orders and administrative approvals have modified
Conservation Order 173.
Rule 8 of Conservation Order 173 was repealed and reenacted by Conservation
Order 230 on May 6, 1987.
Conservation Order 230 was amended by Conservation Order 276 on August
Rule 9 of Conservation Order 173 was amended by Conservation Order 276
on August 6, 1991, although the requirements of Rule 9(c), Conservation
Order 173, have not been modified since the rule was adopted on May 6,
Development activity in the Kuparuk River oil pool is mature and data requirements
have changed since initial development started in 1981.
AAI is responsible for reservoir management, development planning and data
gathering on behalf of the working interest owners of the Kuparuk River
Since 1978, AAI has conducted approximately1,865 pressure surveys in the
Kuparuk River oil pool.
The number of productivity profile surveys will not change only the reporting
frequency will be altered.
NOW THEREFORE, IT IS ORDERED the requirements of Conservation Order
173 as modified by Conservation Orders 190, 198, 230, 262, 276 and 348
and related administrative approvals are hereby consolidated and reissued
under this order. The findings, conclusions and administrative record for
Conservation Orders 173, 190, 198, 230, 262, 276 and 348 are adopted by
reference and incorporated in this decision. These rules apply to the area
as described in Conservation Order 349, issued December 16, 1994.
Data requirements are best determined by the technical needs of the owners,
operators and regulatory bodies responsible for oil and gas development,
appraisal and regulation.
A significant number of pressure surveys have been obtained in the Kuparuk
River oil pool so that pressure response in the pool is better understood
today than when Rule 8(b) was established.
Because of the maturity of the Kuparuk River oil pool and the large number
of existing pressure surveys, Rule 8(b) can be changed to allow more operator
discretion in selecting which wells need pressure surveys and where in
the pool those data are required without compromising reservoir management.
A change to Rule 8(d) will affect only the reporting frequency of Kuparuk
Pool pressure surveys from quarterly to annual reports; Commission oversight
will not be compromised.
Rule 9(c) will change only the reporting frequency of Kuparuk Pool productivity
profile surveys from quarterly to annually; Commission oversight will not
Amending Rules 8(b), 8(d) and 9(c) to eliminate a specified number of pressure
survey and to require pressure and productivity survey reports annually
rather than quarterly will not cause waste, jeopardize correlative rights
or harm ultimate recovery of hydrocarbon resources.
Consolidating the rules and amendments affecting CO 173 into a new order
will eliminate confusion concerning which rules are in effect and lead
to more efficient management of the reservoir.
A new order consolidating the requirements of Conservation Order 173 and
its subsequent modifications will not cause waste, jeopardize correlative
rights or harm ultimate recovery of hydrocarbon resources.
Rule 1. Name of Field (Ref. CO 173)
The name of the field shall be the Kuparuk River Field. (Source CO 173)
Rule 2.Definition of Pool (Ref. CO 173)
The name of the Pool in the Kuparuk River Field shall be the Kuparuk
River oil pool and is defined as the accumulation of oil that is common
to and correlates with the accumulation found in the Atlantic Richfield
Company West Sak River State No. 1 well between the depths of 6,474 and
6,880 feet. (Source CO 173)
Rule 3.Well Spacing (Ref. CO 173, 182, & 198)
Not more than one well may be drilled on any governmental quarter section
or governmental lot corresponding to it nor may any well be drilled on
a governmental quarter section or governmental lot corresponding to it
which contains less than 125 acres, nor may the Pool be opened in a well
bore that is closer than 500 feet to any property line nor closer than
1,000 feet to the pool opened to the well bore in another well except that:
(Source CO 173)
Rule 4. Casing and Cementing Requirements (Ref. CO 173 & 190)
in the area described in Conservation Order No. 198B, except for those
governmental quarter sections adjacent to the Kuparuk River Unit boundary,
four wells may be drilled per governmental quarter section (Source CO 198),
in Sections 5, 6, 7, 8, 15, 16, 21, and 22, T11N, R10E, U.M., an unrestricted
number of wells may be drilled. (Source CO 182)
(a) Casing and cementing requirements are as specified in 20 AAC 25.030,
CASING AND CEMENTING, except as modified below. (Source CO 173)
(b) For proper anchorage and to prevent an uncontrolled flow, a conductor
casing shall be set at least 75 feet below the surface and sufficient cement
shall be used to fill the annulus behind the pipe to the surface. (Source
(c) For proper anchorage, to prevent an uncontrolled flow, and to protect
the well from the effects of permafrost thaw-subsidence and freeze back,
a string of surface casing shall be set at least 500 measured feet below
the base of the permafrost section but not below 2700 feet true vertical
depth. Sufficient cement shall be used to fill the annulus behind the casing
to the surface. (Source CO 173)
(d) The surface casing, including connections, shall have minimum post-yield
strain properties of 0.9% in tension and 1.26% in compression. (Source
Drill Pad 2Z Kuparuk River oil pool wells may be drilled to a maximum depth
of 3250 feet true vertical depth before surface casing is set so long as
drilling fluid densities are monitored and maintained at 10.0 pounds per
gallon. (Source CO 190, modified by AA 190.01 - 190.15)
Drill Pad 2X and 2C Kuparuk River oil pool wells may be drilled to a maximum
depth of 2975 feet true vertical depth before surface casing is set. (Source
CO 190, modified by AA 190.01 - 190.15)
In the event that geologic conditions are not as anticipated, the Commission
may change the maximum depth for setting surface casing by administrative
action, provided a request, in writing, is timely submitted. (Source CO
(e) Other means for maintaining the integrity of the well from the effects
of permafrost thaw-subsidence and freeze back may be approved by the Commission
upon application. (Source CO 173)
The only types and grades of casing, with threaded connections, that have
been shown to meet the requirements in (d) above and have been approved
for use as surface casing are the following:
(A) 13 3/8 inch, 72 pounds/foot, L-80, Buttress;
(B) 13-3/8 inch, 72 pounds/foot, N-80, Buttress;
(C) 10-3/4 inch, 45.5 pounds/foot, K-55, Buttress;
The Commission may approve other types and grades of surface casing upon
a showing that the proposed casing and connection can meet the post-yield
strain requirements in (d) above. This evidence shall consist of one of
(A) full scale tensile and compressive tests;
(B) finite element model studies; or,
(C) other types of axial strain data acceptable to the Commission.
(f) The Commission may approve alternative completion methods (to 20
AAC 25.030(b)(4) and (5)) upon application and presentation of data that
shows the alternatives are based on accepted engineering principles. Such
alternative designs may include: (Source CO 173)
Rule 5. Automatic Shut-In Equipment (Ref. CO 173 & 348)
slotted liners, wire wrapped screen liners, or combinations thereof, landed
inside of open hole and may be gravel packed;
open hole completions provided that the casing is set not more than 200
feet above the productive zone.
(a) Each well shall be equipped with a Commission approved fail-safe
automatic surface safety valve system (SVS) capable of preventing uncontrolled
flow by shutting off flow at the wellhead and shutting down any artificial
lift system where an over pressure of equipment may occur. (Source CO 348)
(b) The safety valve system (SVS) shall not be deactivated except during
repairs, while engaged in active well work, or if the pad is manned. If
the SVS cannot be returned to service within 24 hours, the well must be
shut in at the well head and at the manifold building. (Source CO 348)
(c) A representative of the Commission will witness operation and performance
tests at intervals and times as prescribed by the Commission to confirm
that the SVS is in proper working condition. (Source CO 348)
Wells with a deactivated SVS shall be identified by a sign on the wellhead
stating that the SVS has been deactivated and the date it was deactivated.
(Source CO 348)
A list of wells with the SVS deactivated, the dates and reasons for deactivating,
and the estimated re-activation dates must be maintained current and available
for Commission inspection on request. (Source CO 348)
Rule 6. Safety Flares (Ref. CO 173)
Repealed by 20 AAC 25.235.
Rule 7. Gas-Oil Ratio Tests (Ref. CO 173 & 262)
Repealed by Conservation Order 262, dated October 23 1990.
Rule 8. Pressure Surveys (Ref. CO 173, 230, 276 & 432)
(a) A bottom-hole pressure survey shall be taken on each well prior
to initial sustained production. (Source CO 230)
(b) The operator shall obtain pressure surveys as needed to effectively
manage hydrocarbon recovery processes subject to an annual plan outlined
in (d) of this rule. (Source CO 432)
(c) Bottom-hole pressures obtained by a static buildup pressure survey,
a 24 hour shut-in instantaneous test, a multiple flow rate test or an injection
fall-off test will be acceptable. Calculation of bottom-hole pressures
from surface data will be permitted for water injection wells. (Source
(d) Data from the surveys required in this rule shall be filed with
the Commission by April 1 of the subsequent year in which the surveys are
conducted. Along with the survey submittal, the operator will provide a
proposed survey plan for the upcoming year. Reservoir Pressure Report,
Form 10-412, shall be utilized for all surveys with attachments for complete
additional data. Data submitted shall include, but are not limited to,
rate, pressure, time, depths, fluid gradient, temperature, and other well
conditions necessary for complete analysis of each survey being conducted.
The pool pressure datum plane shall be 6,200 feet subsea. (Source CO 230,
(e) Results and data from any special reservoir pressure monitoring
techniques, tests, or surveys shall also be submitted as prescribed in
(d) of this rule. (Source CO 230)
(f) Upon application by the operator, the Commission in its discretion
may administratively approve exceptions to this rule. (Source CO 230)
Rule 9. Productivity Profiles (Ref. CO 173, 276 & 432)
During the first year of production, a production survey shall be run
in each well that has multiple sand intervals open to the well bore. (Source
(a) Subsequent surveys shall be run in wells that exhibit uncharacteristic
changes in performance. Subsequent surveys shall also be required in wells
which have had remedial work performed to change the production profile
unless the remedial work results in only one sand interval being open to
the well bore. (Source CO 173, 276)
(b) All completed production surveys taken during a calendar year be
filed with the Commission by April 1 of the subsequent year. The Commission
may request data be provided in advance of an annual submittal if required.
(Source CO 173, 432)
(c) By administrative order, the Commission shall specify additional
surveys should it be determined that the surveys submitted under (a) and
(b) are inadequate. (Source CO 173)
DONE at Anchorage, Alaska and dated July 22, 1998.
David W. Johnston, Chairman
Camille Oechsli, Commissioner
Conservation Order No. 432
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