The Alaska Oil and Gasoline Conservation Fee (AOGCC) has imposed a $267,500 civil penalty on Hilcorp Alaska LLC for allegedly violating an accredited drilling course of, based on an official order from the regulator.
The fee levied the penalty after Hilcorp in February 2021 purportedly failed to provide official notification of a change in gear that was not accredited in an earlier allow by the regulator. Hilcorp was conditionally accredited to drill on the Milne Level oil subject on Alaska’s North Slope in 2021, and the allow to drill (PTD) included {an electrical} submersible pump synthetic elevate completion. The fee order said that Hilcorp put in a jet pump synthetic elevate completion with out the regulator’s approval.
In assessing the penalty, the AOGCC mentioned it thought-about Hilcorp’s “lack of fine religion in its makes an attempt to adjust to the accredited PTD” and that the corporate was conscious that “the properly completion was totally different than required with out making any try to handle the discrepancy”.
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The fee additionally thought-about the corporate’s “monitor file of regulatory non-compliance” and “want to discourage related habits in future operations”.
Within the doc, the AOGCC mentioned it had issued greater than 60 enforcement actions towards Hilcorp. The enforcement actions embody provisions for the corporate to determine and implement corrective actions that may stop the recurrence of the violations or incidents. Of these enforcement actions, a number of have been issued for modifications to accredited permits with out prior approval, the fee mentioned.
In a Might 2023 letter despatched to the AOGCC, Hilcorp supplied 4 actions to stop recurrence of the incident, which the fee mentioned have been inadequate and “lack element”. Hilcorp’s proposed steps “seem like narrowly centered to operations and regulatory personnel in Hilcorp Alaska and ignore the potential for related occasions to happen at Hilcorp North Slope LLC operations, the regulator mentioned. Additional, the proposed steps “fail to determine administration oversight shortcoming in assuring compliance with allow specifics”, in addition to “fail to offer a company construction to keep away from the same repeat violation”. The fee mentioned that these omissions “make it unlikely to stop recurrence of this kind of violation”.
In an announcement obtained by Anchorage Every day Information, Hilcorp spokesman Luke Miller mentioned, “Upon studying of this particular incident, Hilcorp instantly started an investigation and took steps to enhance our oversight and inner techniques, together with revising procedures, dedicating further sources and strengthening coaching packages. An vital a part of Hilcorp’s tradition is to get higher every single day, and we look ahead to persevering with to work carefully with AOGCC to make sure compliant, protected and accountable operations”.
In March 2022, the USA Environmental Safety Company fined Hilcorp $180,580 for Clear Air Act violations at 35 of its services in Alaska, positioned in Prudhoe Bay, Milne Level and Kenai Peninsula. The EPA mentioned Hilcorp “did not make well timed repairs when leaks of methane and risky natural compounds have been discovered, did not conduct leak inspection at a brand new facility, and did not precisely report on leak inspection and restore actions from 2018 via 2020”.
In keeping with the corporate web site, Hilcorp was based in 1989 and entered Alaska greater than a decade in the past. The corporate mentioned it’s the largest pure fuel provider within the state, with almost a million gross acres and over 1,700 producing wells with an output of roughly 135,000 web barrels of oil equal per day.
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