While the AER says there is very little risk to public safety, the stop production order was issued in an effort to protect the interests of other operators spanning the Western Canadian Sedimentary Basin. 

The Disassociated Press

CALGARY, Alberta – Alberta’s energy sector watchdog has put a stop production order on the central Alberta operations of a junior oil and gas company that drilled a well that, “violates pretty much every directive we, the AER, have put in place over the last 40 years. The junior operator was handed 1,753 non-compliance notices for a single well,” said Tracy Strokingoff, the Director of Infractions for the provincial regulator.

State-owned Algerian Oil Exploration Pty (AOEP), who started conventional oil and gas development as a non-op joint venture partner with Yanjar Energy in Alberta in 2021, was handed the order to immediately stop operations on all of its licensed assets on Monday, July 17th, 2023 by the AER.

A report published by the AER states that the company failed to drill its first exploratory 100% working interest well according to the well path on the license application.

“According to the Directive 49 license application, the well was to be drilled as a horizontal wildcat oil well to be landed in LSD 04-16-048-08W5 SE on the edge of the Cardium formation in the Pembina field just east of Edmonton. But the as-drilled survey shows that the well had a measured depth of over 1,342 kms and it spanned 178 townships and commingled over 362 pools,” the AER statement reads.

2P News field correspondent, Rodecker Smith, sat down with AOE’s VP Exploration to better understand the AER’s report and the technical nature of the offside well for which the infractions were issued.

Dr. Brian Halloumi Johnson, P.Eng.

According to the company’s VP exploration, “the well we drilled was not in violation of any directives. On the license application, we were asked to specify a surface location and a bottom hole location. Nowhere was it specified how we get from the starting point to the end point, so we decided to drill a true exploratory well. We were able to dip into the Duvernay in Fox Creek just to the east, continue east to grab a little water-flooded oil from the Midale and Oungre beds in SE Saskatchewan before looping back west to touch the upper Viking and some Mannville oil on our way NE to secure dry Montney gas in the Northern Heritage field while stopping along the way for some of that high liquids yield gas in the Kakwa – you know, the good stuffs. And those are just, maybe, 20 percent of the pools we hit, but we did nothing wrong,” said Brian Halloumi Johnson, P.Eng., Ph.D. He continued, “Unfortunately, this well is commingled so we do not know exactly from which zones the hydrocarbons are coming from.”

The as-drilled deviated survey of AOE’s exploratory wildcat well. Square denotes surface hole, circle the bottom hole.

According to a lawyer with the Canadian Associated for Oil and Gas Producers, the junior E&P was perfectly within its rights to drill this well. “I’m not exactly sure how they were able to keep weight on a bit to drill past 2 sections, but a field operator for who was checking one of his wells 2 LSDs over said he saw what appeared to be a makeshift tredecuple rig that pushed 13 stands in one go,” Michael Rossini told 2P News. Mr. Rossini also stated that it could be tricky figuring out how to remit royalties since the well spans 3 regulatory bodies.

Legal action is being pursued by at least 97 operators and 245 farmers who claim their mineral rights have been violated by this 100/04-16 well. 2P News will keep readers apprised on developments on this story as they become available.


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