Breaking News: Hilcorp Faces $452,100 Fine from Alaska Commission for North Slope Oil Site Violations

Hilcorp has been fined $452,100 by Alaska’s oil and gas regulatory commission for rule violations on the North Slope.

The Alaska Oil and Gas Conservation Commission filed an enforcement notice against Hilcorp on Tuesday for improper injections into various portions of the Prudhoe Bay Unit, which includes multiple satellites. Prudhoe Bay, along with its satellites, has been operated by the business since 2020 when it acquired BP’s remaining Alaska assets after the latter vacated the state.

The infractions involve injections of miscible gas, a chemical that mixes with oil to improve oil recovery. The AOGCC’s enforcement order states that violations occurred between mid-2021 and mid-2023.

The order issued Tuesday finalizes a fine that was proposed in December.

Previously, the commission has criticized the company for a number of failures and irregularities. A 2021 order assessing a $267,500 fine for violations at the Milne Point Unit cited Hilcorp’s “lack of good faith” and “track record of regulatory non-compliance,” and it noted that it had already issued more than 60 enforcement actions against the privately held company for violations in both the Cook Inlet basin and the North Slope.

This time, however, the AOGCC stated that Hilcorp had made improvements and taken steps to improve its performance. The enforcement order stated that Hilcorp and the AOGCC reviewed the lower trend in infractions during meetings in December and January.

“While it is always the AOGCC’s desire to have zero violations, and hence zero repeat violations, the AOGCC recognizes the overall downward trend in Hilcorp’s transgressions, which Hilcorp reported during the informal review. “It is encouraging to see Hilcorp monitoring its compliance history and improving performance in this area,” the order stated.

The order stated that Hilcorp did not dispute the infractions but questioned the assessed penalty. The commission decided not to reduce the penalty from what was requested in December, but it did waive the obligation that Hilcorp give a report on the events, according to the decision.

According to the decision, Hilcorp has already conducted an internal inquiry into the causes and methods to prevent future recurrences and shared the findings with the Commission.

The order stated that Hilcorp must not only pay the penalty but also carry out the corrective activities outlined in its internal investigation.

In a statement, Hilcorp spokesperson Luke Miller mentioned the company’s increased performance.

“We are pleased to see a downward trend in compliance issues, as noted by AOGCC in its Order, and look forward to continuing to work closely with AOGCC to ensure compliant, safe,¬†and responsible operations,” Miller said in a press release.

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