Commission office in Anchorage is seen on March 23, 2023. The commission has assessed a $6.34 million fine against Brooks Range Petroleum, an independent company that is now inactive. (Photo by Yereth Rosen/Alaska Beacon)
Alaska regulators have ordered an inactive oil company to pay more than $6 million in fines for failing to properly close and plug North Slope oil wells that it left as long ago as 2007.
The Alaska Oil and Gas Conservation Commission assessed the fine in an order issued on Friday against Brooks Range Petroleum, an independent company that produced oil on the North Slope only briefly.
Despite being notified in December that the commission had proposed the fine, Brooks Range “failed to respond or otherwise contest the Notice,” the AOGCC said in its March 7 order. The fine thus goes into effect by default, the commission’s order said.
Three wells in the now-dissolved Beechey Point Unit are the subject of the enforcement action. The total fine of $6.34 million assessed by the AOGCC is based on years of daily violations of state regulations concerning proper well abandonment.
It is the largest fine ever assessed by the commission, a spokesperson said.
The oldest of the three unplugged wells, the North Shore 1 well, was drilled in 2007 and completed and shut down the following year. It should have been properly plugged by May 7, 2009, and has been in violation since then, according to the AOGCC.
The second well, the Sak River 1A Well, was drilled in 2010 but was active for only two months, according to the AOGCC. The lease on which it was located expired in 2012, and the unplugged well has been in violation ever since then, the commission said.
The third well, the North Shore 3 Well, was also drilled in 2010. It has been in violation since 2019, when the lease on which it was located expired, according to the AOGCC.
Brooks Range now has 30 days to pay the full penalty or appeal the order, the commission said.
The AOGCC’s correspondence was addressed to Henricus Bockmeulen, identified as vice president of Brooks Range. However, it is unclear what entity is now responsible for paying the fine or plugging the wells.
Brooks Range representatives did not respond to requests for comments on the AOGCC’s action.
The company was embroiled in financial trouble at a different field, Mustang, which hugs the southern edge of the Kuparuk River field.
While operated by Brooks Range, Mustang produced oil for one month in 2019. Brooks Range defaulted on a loan granted by the Alaska Industrial Development and Export Authority, and the state-owned development agency foreclosed on the company’s assets in 2021. Mustang now has a different owner, Finnex, that restarted production at the end of 2024, Petroleum News reported.
Brooks Range is not the only company that left unplugged wells in Alaska
The AOGCC has a program to address what are known as “orphan wells,” previously drilled wells that were abandoned without proper safety or environmental steps. As of last year, there were 47 such wells identified by the state. The state has hired a contractor, a unit of Arctic Slope Regional Corp., to do cleanup and plug the wells.
The state last year got $25 million from the U.S. Department of the Interior to help pay for proper closure of orphan wells on state and private land. The money was allocated through the Infrastructure Investment and Jobs Act of 2021.
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