NEWS BULLETIN

July 25, 2001 --- Vol. 7, No. 88July 2001

Unocal drills Cook Inlet record well from King Salmon platform

Unocal Corp. said July 25 that it has completed two significant development wells in Cook Inlet, including one that is producing at the highest rate of any oil well in Cook Inlet history.

Both wells are in the McArthur River field.

We have refocused on oil production from our Cook Inlet assets, and we are achieving good success through the use of advanced drilling and analytical technologies," said Charles Pierce, vice president for Unocal Alaska. "We are already seeing the results of our $18 million drilling and work over program on the King Salmon platform this year."

The K-13 well, which came on production in early July, is producing 7,100 bopd. Unocal said this is the highest rate from any oil well in Cook Inlet history and has pushed production from the King Salmon platform to the highest level in almost 20 years. The well confirmed a structure in the Hemlock horizon on the northern flank of the field that could contain more than 35 million barrels of oil in place.

The K-1 well, also drilled from the King Salmon platform, came on line in early May and is currently producing 1,100 bopd from the "G" zone.

Unocal holds a 56 percent working interest in the McArthur River Field Hemlock zone and a 49 percent working interest in the "G" zone. Forest Oil Corp. holds the remaining interests.

North Slope, Beaufort Sea areawide sales receive final notice

The state has issued notices of sale for the North Slope and Beaufort Sea areawide 2001 oil and gas lease sales.

The Department of Natural Resources Division of Oil and Gas said July 25 that bids for the sales will be opened Oct. 24 in the Wilda Marston Theater at the Loussac Public Library in Anchorage.

There is a minimum bonus bid of $5 an acre for the North Slope tracts and $10 an acre for the Beaufort Sea tracts. Royalty rates vary by tract, with some tracts having a rate of 12.5 percent and some a rate of 16.66667 percent.

Lease terms also vary, with some tracts leasing for 10 years and some for only seven.

Complete details regarding these lease sales, including the sale announcements in their entirety, instructions to bidders, tract deletions, and regional tract maps are available on the division's website: www.dog.dnr.state.ak.us/oil.


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