The Interior Department's Bureau of Ocean Energy Management* has given conditional approval to a subsidiary of Hilcorp Energy Co. to develop an offshore oil and gas production facility in Alaska's Beaufort Sea.
Hilcorp Alaska LLC has proposed building a 9.3-acre artificial island, Liberty Island, about 15 miles east of Prudhoe Bay in Foggy Island Bay. A subsea pipeline would connect the island to the mainland. The water depth at the construction site is about 19 feet. If it were to move forward, the project would be the first completely federal Outer Continental Shelf production facility in the Alaska Region. Hilcorp filed its plans in 2015.
"We consider Hilcorp's plan to represent a relatively conservative, time-tested approach toward offshore oil and gas development," said Interior's Joe Balash, assistant secretary for land and minerals management.
Hilcorp previously said Liberty Island would be similar to four other artificial islands used in Alaska's offshore for nearly 30 years. Endicott and Northstar islands were completed by Alaska Interstate Construction LLC in 1987 and 2000, respectively, and were subsequently used by units of BP plc and Hilcorp to produce North Slope oil, targeting the Endicott and Northstar oilfields. Hilcorp purchased BP's interests in Endicott and Northstar in 2014.
Meanwhile, Pioneer Natural Resources Co. completed an offshore island in the Oooguruk oilfield in 2008, which was sold to Caelus Energy Alaska LLC in 2013. Oil began to flow in 2011 from Spy Island, an artificial island built atop the Nikaitchuq oilfield and owned and operated by Italy's Eni SpA.
Partners in the project include BP Exploration (Alaska) Inc. and ASRC Exploration LLC.
*Correction: In the original article, it was incorrectly reported that the Department of Interior’s Bureau of Safety and Environmental Enforcement gave conditional approval for the project. NGI regrets the error.