BlueCrest fined $20,000 for 2 safety valve violations

On April 26 the Alaska Oil and Gas Conservation Commission (AOGCC) issued a $20,000 fine to the Cook Inlet hydrocarbon extractor BlueCrest Alaska Operating for failing two safety valve requirements for the oil wells it operates from the onshore Hansen drill pad between Anchor Point and Ninilchik.

AOGCC notified the Forth Worth, Texas-based BlueCrest of two violations — each with a $10,000 penalty — on Dec. 13, 2017, and held a review with BlueCrest on Jan. 9, 2018, at which the company didn’t dispute the violations, according to AOGCC’s order for the fine.

In April 2016, BlueCrest produced its first barrel of oil from a well previously drilled on the Hansen site by ConocoPhillips in 2003. AOGCC fined BlueCrest for its production from this well, dating the violation to April 5, 2016, because its subsurface safety valve lacked equipment that would automatically close it in response to a well pressure change.

State code requires a well’s subsurface safety valve to automatically shut off flow within four minutes after an electronic or mechanical detector senses a pressure change. The safety valve of BlueCrest’s first well was not connected to a pressure detector, and was instead set to close only for an emergency shutdown or a plant shutdown.

BlueCrest confirmed this to AOGCC after the well’s safety valve failed to respond to low pressure in the well’s flowline — the pipe that carries the well’s output from the wellhead to the processing equipment — during a March 23, 2017 test. BlueCrest hadn’t applied for a waiver from the requirement, drawing a citation.

BlueCrest’s safety valves have since been connected to pressure detectors and were successfully tested on Jan. 8, according to a letter to the AOGCC from BlueCrest Health, Safety and Environment Manager Larry Burgess.

BlueCrest committed the second violation by not testing the safety valve system of another well that it finished drilling in late November 2016 and later hydraulically fractured. BlueCrest planned to test this well’s safety valve system — required within five days of starting it — before bringing it online in July 2017. Though BlueCrest notified AOGCC of its plan to test the valve on July 3 of that year, that test was delayed three days because of “operations not progressing as expected,” according to a notice to the agency from a BlueCrest representative. AOGCC subsequently waived its opportunity to witness the first safety-valve test, planning to do so in a later visit.

AOGCC requested a record of the July test in October 2017. Though a BlueCrest operation log book recorded a successful safety valve test on July 2, 2017, Burgess later wrote to AOGCC that the employee who performed it no longer works for BlueCrest, and that the company couldn’t find any further records, resulting in the second penalty.

AOGCC officials witnessed a safety valve test on November 9, 2017, according to the agency’s penalty order.

Reach Ben Boettger at

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