NEWS BULLETIN

October 29, 2003 --- Vol. 9, No. 103October 2003

State sales garner $5.8 million; Pioneer dominates with bids of $3.8 million

The state of Alaska held two lease sales today, areawide Beaufort Sea and areawide North Slope, and garnered $5.8 million in high bonus bids. The same company, Pioneer Natural Resources Alaska, dominated both sales, with $1.5 million at the Beaufort sale out of a total of $1,975,833.60 in apparent high bids, and $2.3 million at the North Slope sale out of a total of $3,833,333.60 in apparent high bids.

Pioneer took 12 leases in the Beaufort Sale, where the state received 26 bids on 20 tracts in that sale, some 48,640 acres.

Pioneer appeared to be filling in around its discoveries last winter at the Northwest Kuparuk prospect, and then picked up a huge block of leases onshore, south of Prudhoe Bay and west of the trans-Alaska pipeline.

The other big bidder in the Beaufort Sea sale was AVCG, which took six leases, spending $241,920. Armstrong and UltraStar each took one track in the Beaufort Sale.

The state received 79 bids on 75 tracts in the North Slope sale, some 220,800 acres, Jim Hansen, lease sales manager at the Division of Oil and Gas, said at the bid opening. Pioneer took 41 tracts.

Anadarko Petroleum took 16 tracts, paying almost $857,000. AVCG took nine onshore tracts, paying just over $325,000. ConocoPhillips and Keith Forsgren each took four tracts, and Armstrong took a single tract.

Chris Cheatwood, Pioneer’s executive vice president for worldwide exploration, told Petroleum News after the sale that the company bid on some 167,000 acres, and expects to come away from the sale with about 155,000 acres, once the state finalizes the title work and provides exact acreage for each tract. The company filled in some tracts around its Northwest Kuparuk discovery of last winter, and also picked up some tracts north of Prudhoe, he said.

Cheatwood said the company’s next step on the large onshore block would probably be to acquire more seismic.


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