January 10, 2005

Efforts continue to bring Acclaim's Acheson well under control

Acclaim Energy, the operating subsidiary of Acclaim Energy Trust, is still working in collaboration with Alberta's Energy and Utilities Board (EUB) and other regulatory authorities and technical specialists to bring its Acheson well under control following a December 12 release of hydrogen sulfide (H2S) gas from the well during a routine workover. The well, known as 2-26, is located west of Edmonton on Township Road 524, at 2-26-52-26 W4M.

There were no injuries as a result of the H2S release and the company moved quickly to activate its emergency response plan. The following day, a Regional Emergency Operations Centre (REOC) was opened to co-ordinate response activities. Representatives include the EUB, Acclaim, Alberta Environment and the Capital Health Authority.

Area residents were informed of the incident and evacuated to a safe location. Approximately 600 people were relocated to Edmonton area hotels at Acclaim's expense. As of last week, eight families were still mandatorily evacuated, with several other homes voluntarily evacuated. The company continues to accommodate all evacuees.

Initial air quality and wind monitoring at sites from one-half to three kilometres away from the wellhead showed H2S levels in the gas at 370 parts per million (ppm) or 0.037% H2S. This is classified as low sour content. Levels of sour gas measured 3/4 of a kilometre away from the well were trace at less than 0.19 ppm.

Subsequently on December 13, the gas unexpectedly ignited as operations were being initiated to stabilize the Acheson gas well. Two workers who were near the well at the time of the ignition were evacuated to safety, treated for minor injuries on site and transported to medical facilities for further treatment. Well service and control specialist Safety Boss succeeded in extinguishing the fire late the following day, using water to cool the fire before applying a dry chemical agent.

An initial group of five air quality monitors reported extremely low levels of H2S, ranging from zero to 32 parts per billion (ppb). Acclaim subsequently increased the number of air monitors within a one-kilometre radius of the wellhead to 14. The readings of all of the monitors are being reported regularly to the REOC.

Extinguishing the fire allowed experts to inspect the wellhead to be carried out. They found that the integrity of both the casing and the wellhead had been compromised, posing a risk for the workers on-site and presenting an obstacle to bringing the well under control. Following discussions and technical review with a number of government agencies, including the EUB and Alberta Environment, Acclaim decided to pursue multiple options aimed at bringing the Acheson well under control, starting with a controlled igniting of the well.

"By moving to a controlled ignition of the well we are mitigating the risk to our workers and addressing the concerns about odours and H2S emissions. A controlled fire will burn off the H2S, rather than have it accumulating in low-lying areas at the well site where it has the potential to spark and reignite unexpectedly," explained Brent DeFosse, Acclaim Energy's vice-president of production and chief operating officer.

The company also began work to drill two relief wells, to reduce the pressure of the original well to bring it under control, and initiated a three-step soil and groundwater protection plan. This involves sampling and testing of all water wells within a one-kilometre radius of the site, groundwater monitoring, and soil sampling and testing. By last week, all water wells within a two-kilometre radius of the site had been sampled, with results expected this week. Preliminary results from five test wells within one kilometre had shown no impact to residents' water wells, while preliminary tests from Acclaim's three groundwater monitoring wells indicated no adverse impacts on groundwater in the area.

Other response activities are focusing on fluid management: the well is producing salt water and some hydrdocarbons, which are being directed to earthen pits at the site. More than 2,000 cubic metres per day of waste fluids and solids are being handled daily, trucked to a temporary, EUB-approved storage site equipped with a compacted clay liner. The EUB has also approved temporary disposal of water at another well operated by Acclaim.

The process of bringing the well fully under control may take another week or more. The cause of the original release and the extent of the damage are unknown at this time, but will be thoroughly investigated by both Acclaim and the regulatory agencies once the well has been brought under control. The REOC will continue operating until the conclusion of the well control incident.

More information is available from Acclaim president and CEO Paul Charron, 403/539-6300 or 1-877-539-6300, or on the Acclaim Web site, www.acclaimtrust.com; also from the REOC, 780/460-3800, or on the EUB Web site, www.eub.gov.ab.ca.

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