Embattled oil company fined $200,000 for unplugged wells

Alaska oil well regulators fined an independent oil and gas company $200,000 for abandoning two onshore wells in the Cook Inlet region without plugging them, striking a blow to a company that is also suing former executives after millions of dollars went missing.

Nordaq Energy offered multiple reasons in protesting the fines, including that a theft at its offices in Midtown Anchorage prevented it from responding to the Alaska Oil and Gas Conservation Commission's initial notices proposing the penalties in December, according to the agency.

But the company did not dispute it did not cap the wells before the rights to its leases ended, as it should have done, the agency's orders said.

The wells are Tiger Eye-1 on the Inlet's west side and Shadura-1 on the east side. They are still not properly capped, the orders show.

The agency issued the orders separately for each well Thursday and Friday. In December, it had initially proposed fines totaling $771,000.

Now, AOGCC is also requiring $2 million in bonds. The contracts are designed to protect the state if Nordaq doesn't properly plug and abandon the wells within a year and the state is forced to pay for their capping and cleanup.

On the North Slope, Nordaq owns 17.5 percent of the Smith Bay leases, where Caelus Energy Alaska announced a large oil discovery last year. Caelus has said it won't drill an appraisal well in Smith Bay this winter, as originally planned, potentially delaying oil revenue from the field's development and leaving the prospect unconfirmed.

Nordaq is also in federal court suing former executives fired from the company in 2015 after, the company says, they improperly spent large sums of money.

[Claiming millions of dollars missing, an exploration company sues.]

Alaska business records show the company's investors include Chinese investment company Nuoxin Co. and John Paul Dejoria, co-founder with Paul Mitchell of the Mitchell hair products company.