NEWS BULLETIN

August 13, 2001 --- Vol. 7, No. 98August 2001

Phillips stakes 12 new NPR-A wells; looking to permit up to 45 winter exploration wells

Phillips Alaska Inc. has staked 12 wells in the National Petroleum Reserve-Alaska for possible drilling this winter, federal officials told PNA. All stakings are new well locations.

Staking is a prelude to filing for drilling and related well permits, federal officials said. State officials said Phillips expects to submit application packets for up to 45 wells in Alaska this season; 19 of which have been previously permitted.

The wells staked by Phillips in the NPR-A are as follows:

1. Field: Hunter, Well 3, Location SWNW 4 8N 1W; Lease AA081773

2. Field: Mitre, Well 1; Location NWSW 2 10N 2E; Lease AA081801

3. Field: Hunter; Well 2; Location SESE 29 9N 1W; Lease AA081787

4. Field: Grandview; Well 1; Location SENW 27 10N 1W; Lease AA081807

5. Field: Nova; Well 1; Location NWSW 22 10N 2E; Lease AA081799

6. Field: Nova; Well 2; Location NENW 23 10N 2E; Lease AA081799

7. Field: Spark; Well 6; Location SWNW 11 10N 1E; Lease AA081805

8. Field: Spark; Well 7; Location NESE 5 10N 1E; Lease AA081806

9. Field: Rendezvous; Well 3, Location SWSW 29 10N 2E, Lease AA081800

10. Field: Tuvaaq, Well 1, Location NWNE 9 10N 3E, Lease AA081798

11. Field: Tuvaaq, Well 2, Location SENE 7 10N 3E, Lease AA081798

12. Field: Tuvaaq, Well 3, Location SWNE 30 11N 3E, Lease AA081818

In a recent interview with PNA, Phillips Alaska’s outgoing Vice President of Exploration and Land, Mike Richter, said that further evaluation of the three discoveries made in the NPR-A this past year was a number one priority.

Evergreen Resources in negotiations with Cominco, Dave Lappi on Red Dog and Interior shallow gas plays

Mark Sexton, president and CEO of Evergreen Resources Inc., told PNA that his firm is in negotiations with Dave Lappi and Cominco Alaska Inc. regarding the exploration and development of 65 shallow gas leases in the Interior and four shallow gas leases north of the Red Dog Mine, respectively. The Denver-based independent holds a 100 percent working interest in the Pioneer unit, a prospective coalbed methane property 30 miles northwest of Anchorage.

Sexton said Evergreen has “reached agreement with Lappi’s group,” the contact name on 65 shallow gas leases that the state recently issued near Delta Junction to eight different leaseholders. Lease acreage totals 333,383 acres.

“We’re in discussions now about what makes sense for the exploration and potential development of that area and what is a reasonable time frame.”

Sexton said he thinks the leases should be unitized: “We have agreements in place to drill wells but we think a necessary next step is to get a unit set up. … We have a lot of experience in Colorado with coalbed methane. To do it right you really need to unitize –you need the orderly development a unit provides.”

Lappi told PNA he is in “ informal discussions” with the state regarding setting up a unit to develop the eight leases.

Evergreen is one of the companies that Cominco has approached to develop its four shallow gas leases on 23,040 acres in the Wulik Basin some 8 miles north of the Red Dog Zinc Mine in Northwest Alaska.

“I visited the Cominco mine about two weeks ago and personally think there is a good opportunity for a natural gas play in the area,” Sexton said. He is waiting for a report from Evergreen “senior geologists to determine” the extent of the “shallow tight gas sand play.”


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