Miller announced the commencement of operations to bring its Osprey offshore oil platform, located in the Cook Inlet of Alaska, out of lighthouse mode.
Miller's wholly owned subsidiary, Cook Inlet Energy, LLC, ("CIE" or "Cook Inlet Energy") led by CEO David Hall, has completed its planning and received the necessary approvals from the Alaska Department of Natural Resources to begin operations to bring the Redoubt Unit, including the Osprey Platform, back into production. This process included obtaining the approval of CIE's Amended Redoubt Unit Plan of Development, which was approved on February 17, 2011, as well as approval of the Redoubt Redevelopment Plan, which was approved March 16, 2011. CIE was also required to enter into a Performance Bond Agreement for the Redoubt Unit. This agreement was executed on March 14, 2011, and payments to fund the $12,000,000 balance of the bond will commence in July 2013.
Cook Inlet Energy has begun hiring additional field workers and has staff on the Osprey Platform to begin the process of restarting its systems. A hydraulic snubbing unit is under contract and en route to Alaska and should be installed on the Osprey to begin workover operations on three wells in April. Production from those three wells is expected to be online soon thereafter. Additional workovers on Osprey are planned for later this year.
"As a result of the hard work of our team in Alaska, as well as the cooperation of the Alaska Department of Natural Resources, we are now in position to tap the enormous potential of the Osprey Platform. At one time production on the platform reached 4900 barrels per day. I look forward to a return to these levels," said Scott M. Boruff, Miller CEO. "We are initially targeting three wells, two that entail replacement of downhole electrical submersible pumps and should quickly add approximately 400 barrels of oil a day to our production. The third workover entails reactivation of a previously producing gas well. We can then turn our attention to the additional previously producing wells on the platform."
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