NGI The Weekly Gas Market Report / NGI All News Access

Alaska Commission to Revise Prudhoe Bay Gas Output Rate

A group of North Slope producers plans to submit a proposal to the Alaska Oil and Gas Conservation Commission (AOGCC) about sharing proprietary production data from the Prudhoe Bay reservoir. A final agreement on use of some of the data is expected to help the commission revise a rule on the rate of allowable natural gas production from Prudhoe, which in turn could pave the way for moving forward on the producers' proposed $20 billion gas pipeline.

The AOGCC wants the data from the producers -- BP, ConocoPhillips and ExxonMobil -- to enable it to begin revising the production rule this summer. To allay producers' concerns, the commission plans to keep some of the information confidential.

The three producers told the commission earlier this month that they will provide the data using an assumed throughput of 4.5 Bcf/d, which could be raised to 5.6 Bcf/d with new compression. The commission's current rule, issued in 1977 when Prudhoe oil production began, allows gas offtake of 2.7 Bcf/d. The AOGCC's rule now balances the loss of oil fluids against dry gas production from Prudhoe.

The revised production rate is needed before holding an open season for the proposed pipeline, according to the producers. However, the AOGCC countered that unless the producers share some of their proprietary data, the commission will have to construct a new reservoir model, which could delay a revised rule by up to three years.

©Copyright 2005 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.