Hilcorp begins production from field south of Ninilchik

Kristen Nelson

Hilcorp Alaska began natural gas production from Red Pad on the Kenai Peninsula last week.

Production is at 5 million cubic feet per day, Hilcorp Alaska spokeswoman Lori Nelson told Petroleum News in an email. She said Hilcorp is "continuing to monitor the system" and hopes to reach its original production estimate of 6.5 million cubic feet per day.

The field was discovered by Unocal in 2004, and the Red 1 well tested 3.2 million to 5.8 million cubic feet per day in a 26-hour test. A second well, Red 2, was also drilled and tested in 2004, but there were no measurable hydrocarbons. Production is from an existing gravel pad built by Unocal.

The Nikolaevsk unit leases were transferred to Hilcorp on Jan. 1 as part of Hilcorp's purchase of Chevron subsidiary Union Oil Company of California's Cook Inlet assets.

Line just completed

The gas is in the Nikolaevsk unit some 14 miles southeast of Ninilchik on the southern Kenai Peninsula, and was stranded until a 6-inch pipeline was completed by Semco Energy's Alaska Pipeline Co. subsidiary in early December. The line runs some 10 miles east to connect with Alaska Pipeline Co.'s Anchor Point pipeline.

Hilcorp funded the Red Pad Pipeline through a contribution in aid of construction agreement; the estimated pipeline cost was $8.4 million.

In filings with the Regulatory Commission of Alaska in the fall, Alaska Pipeline Co. said pipe for the Red Pad Pipeline had already been purchased and that Hilcorp "has arranged for its expedited transportation to the construction site," with most of the pipe already in Alaska.


By KRISTEN NELSON
Petroleum News