STATE OF ALASKA
OIL AND GAS CONSERVATION COMMISSION
3001 Porcupine Drive
Anchorage, Alaska 99501-3192

Re:THE APPLICATION OF MARATHON)              Disposal Injection Order No. 13 
      OIL COMPANY (Marathon) for            )
      underground disposal of Class II oil       )
      field wastes by injection through the      )
      annulus of the North Trading Bay Unit   )
      well S-4.                                                    )

                                                                                        September 12, 1997

IT APPEARING THAT:

1.By letter dated July 28, 1997, Marathon requested authorization from the Alaska Oil and Gas Conservation Commission ("AOGCC") to dispose Class II oil field waste fluids by underground injection through the annulus of the North Trading Bay Unit well S-4, located on the Spark Platform.

 2. Notice of opportunity for public hearing was published in the Anchorage Daily News on July 1, 1997.

 3. The Commission did not receive protest or a request for a public hearing.

 FINDINGS:

 1. Marathon is the operator of the North Trading Bay Unit. There are no other operators within a one-quarter mile radius of the proposed disposal injection project.

 2. Marathon is the only working interest owner within the North Trading Bay Unit.

 3. Marathon proposes disposal injection through the 9 5/8'' x 13 3/8'' annulus in the North Trading Bay Unit S-4 well ("NTBU S-4"). The annulus of NTBU S-4 is open to the Tertiary Tyonek Formation from 2132' measured depth ("MD") to 7045'MD.

 4. Marathon ran open hole logs in NTBU S-4 from 2132' MD to total depth ("TD"). The operator derived lithologic information above 2132' MD using logs from the NTBU S-1 well, which was logged from 450' MD to TD. NTBU S-1 is within 250' of NTBU S-4 through interval between 450' MD and 2135' MD.

 5. The Tyonek Formation in North Trading Bay Unit is composed of an alternating sequence of fluvial deposits including sandstone with minor conglomeratic intervals, siltstone, shale and coal. The 9 5/8'' x 13 3/8'' annulus of NTBU S-4 is in contact with approximately 600 feet of porous and permeable sandstone capable of serving as a receiving zone for the disposed fluids.

 6. A net thickness of 180 feet of confining zone lithologies is present in the NTBU S-1 well between 980' MD and 1908' MD.

 7. Well NTBU S-4 was constructed with 13 3/8'', 61 lb/ft, J-55 casing set to 2132' MD and cemented to surface; and 9 5/8'', 47 lb/ft, N-80 casing set to 10744' MD and cemented to 7045' MD.

 8. There is no serviceable tubing or packer in the NTBU S-4 well, nor in any other well on the platform that may be capable of being used as an injection well. These wells have all been killed with mud to leave them in a more secure condition.

 9. The U.S. Environmental Protection Agency ("EPA") has exempted the portion of aquifers beneath Cook Inlet described by a one-quarter mile area beyond and lying directly below the Trading Bay Field (40 C.F.R. § 147.102).

 10. North Trading Bay Unit is within the geographical area known as the Trading Bay Field.

 11. The Commission may authorize less stringent requirements for a well or project if injection does not occur into, through or above a freshwater source or non-exempt aquifer (20 AAC 25.450).

 12. The mechanical integrity of NTBU S-4 cannot be established through the procedures prescribed in 20 AAC 25.412 because the well is not equipped with serviceable tubing or packer.

 13. Annulus pressure monitoring, as described in 40 CFR § 146.8(b)(3), can be used to verify mechanical integrity of the casing above the injection zone in NTBU S-4.

 14. Injectant will consist of Class II waste fluids associated with the production of the NTBU S-2rd well and from any workover operations within that well. These fluids will primarily consist of produced water with salinities ranging from 5,000 to 15,000 parts per million, and completion fluids composed of three to six percent KCL brine with various additives.

 15. NTBU S-2rd currently is produced only when there is a demand for gas, normally during the winter.

 16. Marathon anticipates the average daily disposal volume will be less than 5 barrels, with a maximum daily volume over the life of the project of 300 barrels.

 17. The total volume of disposal fluid estimated for the life of the project is 200,000 barrels.

 18. Marathon estimates that the average surface injection pressure will be 700 psig, with a maximum surface injection pressure of 1000 psig.

 19. Third party evaluation of the proposed disposal injection operation by a hydraulic fracturing stimulation contractor indicates that the maximum daily volume of 300 barrels injected at 1000 psig will be incapable of fracturing the lithologies adjacent to the NTBU S-4 well.

 20. The injection zone formation waters are largely equivalent in salinity to the produced formation waters. Typical salinities determined using standard analytical techniques are 5,000 to 15,000 parts per million for these fluids.

 21. Operational reports of cementing procedures indicate NTBU S-4 and all wells within a one-quarter mile radius of the subject well are competently cemented and are unlikely to serve as migration conduits for disposal fluids.

 22. The Commission has previously approved the annular disposal of oil field waste fluids in the NTBU S-4 well under the authority of 20 AAC 25.080. That approval expired March 31, 1997.

 CONCLUSIONS:

 1. The requirements of 20 AAC 25.252 have been met.

 2. Waste fluids authorized for disposal under this order in NTBU S-4 will consist exclusively of Class II waste generated from workover and production operations of the NTBU S-2rd well.

 3. Permeable strata that can be reasonably expected to contain the total volume of disposal fluids anticipated for this project are in contact with the 9 5/8'' x 13 3/8'' annulus in NTBU S-4.

 4. Movement of waste fluids will be confined within appropriate receiving intervals by confining lithology, cement isolation of the NTBU S-4 9 5/8'' x 13 3/8'' annulus and operating parameters.

 5. Fracturing of the disposal receiving zones is unlikely under the proposed operating parameters.

 6. Monitoring of disposal rates and pressures will ensure fluids are contained within the disposal interval. Changes in these parameters may be an indication that fluid is escaping beyond the authorized disposal interval.

 7. Disposal injection in NTBU S-4 will not occur into, through, or above a non- exempt freshwater aquifer, and will not result in an increased risk of movement of fluids into a freshwater source.

 8. Annulus pressure monitoring is an acceptable technique to demonstrate mechanical integrity for this well.

 9. Low disposal volumes and unique conditions associated with the facility location, reservoir producing age, and producing characteristics of well NTBU S-2rd do not justify drilling a dedicated disposal well nor equipping an existing well on the Spark Platform with a serviceable tubing and packer.

 10. The cost of equipping the NTBU S-4 well with a serviceable tubing and packer outweigh the benefit derived from producing the NTBU S-2rd well.

 11. Disposal injection operations in NTBU S-4 will not cause waste nor jeopardize correlative rights, and will likely result in greater ultimate recovery from the North Trading Bay Unit.

 NOW, THEREFORE, IT IS ORDERED THAT:

 Rule 1 Authorized Injection Strata for Disposal.

 Class II oil field fluids may be injected into the NTBU S-4 well in conformance with Alaska Administrative Code, Title 20, Chapter 25, for the purpose of disposal into strata which is common to and correlates with the Tyonek Formation between 1908' - 7045' MD.

 Rule 2 Demonstration of Tubing/Casing Annulus Mechanical Integrity.

 The operator shall confirm mechanical integrity by analyzing the recorded daily disposal rates and pressures to determine that for a given rate, the pressure has not varied by more than 25%.

 Rule 3 Well Integrity Failure

 Whenever disposal rates and/or operating pressure observations or pressure tests indicate pressure communication or leakage of the casing above the shoe, the operator must notify the Commission on the first working day following the observation, obtain Commission approval of a plan for corrective action and obtain Commission approval to continue injection.

 Rule 4 Operational Criteria

 Average daily disposal rates shall not exceed 5 bbls/day, and maximum disposal rates shall not exceed 300 bbls/day. Maximum disposal injection surface pressure in NTBU S-4 shall not exceed 1,000 psi.

 Rule 5 Surveillance

 Operating parameters including disposal rate, disposal pressure, annulus pressure and fluid volume must be monitored and reported according to the requirements, where applicable, of 20 AAC 25.080 and 20 AAC 25.432. An annual report evaluating the performance of the disposal operation will be submitted on or about July 1 each year.

 Rule 6 Administrative Action

 Upon request, the Commission may administratively revise and reissue this order upon proper showing that any changes are based on sound engineering practices and will not allow waste fluids to escape from the disposal zone.

 DONE at Anchorage, Alaska and dated September 12, 1997.
__________________________________________
David W. Johnston, Chairman
Alaska Oil and Gas Conservation Commission

__________________________________________
Robert N. Christenson, P.E., Commissioner
Alaska Oil and Gas Conservation Commission
 
Disposal Injection Order No. 13
September 12, 1997

 

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