August 28, 2003 --- Vol. 9, No. 84August 2003

State receives notices of interest in Bristol Bay exploration licenses

The Alaska Division of Oil and Gas received two expressions of interest in its exploration license offering in the Bristol Bay region, Jim Hansen, the division’s leasing manager, told Petroleum News Aug. 28. Because of the competitive nature of the exploration license bid process, the names are not being released.

Companies had 30 days, until Aug. 25, to notify the division of intent to submit a proposal. They now have 30 days, until Sept. 23, to submit the proposal.

The division will then go out with a public notice and also solicit for competing proposals, Hansen said. Once again companies will have 30 days to notify the division of intent to submit a proposal and another 30 days to submit the actual proposal.

“By the end of November we will know for sure how many applicants we have,” Hansen said.

Proposals are limited to 500,000 acres and the entire area is some 3 million acres, so the state “could get two proposals that do not overlap, in which case there could be two licenses issued,” he said. “But the most likely scenario is that there will be overlap (in the proposals) and the division will then define the area.”

Once companies have seen the area outlined and know what mitigation measures will be required, they can then submit a final bid. Bids for exploration licenses are work commitments.

Editor’s note: See full story in the Aug. 31 issue of Petroleum News.

NorthStar Energy wants to expand North Fork unit

NorthStar Energy Group, operator of the North Fork gas field east of Anchor Point on Alaska’s southern Kenai Peninsula, has applied to the U.S. Bureau of Land Management and the Alaska Department of Natural Resources to expand its North Fork unit from 640 acres to almost 27,000 acres, a BLM official told Petroleum News today.

“The original unit, back in the 1960s was 57,000 acres and NorthStar is looking at the same play,” he said. The original field owners “drilled a well there (part of Northstar’s 640 acre North Fork unit) and discovered gas, but there was no market. Now there’s a market.”

NorthStar recently struck a deal with Enstar Natural Gas Co. to provide gas for a new pipeline that the two companies will build from the North Fork gas field to Homer.

NorthStar needs to drill a second well to ensure gas supply, something BLM says the company plans to do next year.

Standard Oil of California, now ChevronTexaco, operated the first North Fork unit, formed in the 1960s.

ChevronTexaco is one of the leaseholders in Northstar’s proposed unit expansion, BLM said. Other leaseholders include ConocoPhillips, Marathon Oil, Gas-Pro (acquired by Northstar in 2001), Alliance, Aurora Gas, Alliance Energy and White.

Editor’s note: See full story in the Aug. 31 issue of Petroleum News.

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