NEWS BULLETIN

June 02, 2004 --- Vol. 10, No. 53June 2004

BLM NW NPR-A sale draws $53.9M in high bids for 123 leases

Five companies, singly and in partnerships, bid $53,904,491 in high bonus bids at the Bureau of Land Management’s northwest National Petroleum Reserve-Alaska sale in Anchorage June 2.

Bidders were: Anadarko Petroleum Corp., ConocoPhillips Alaska Inc., Pioneer Natural Resources Alaska Inc., Petro Canada Alaska Inc. and Fortuna Exploration LLC.

The single largest bid, $13,745,000, was from Fortuna for tract D-19 near the Ikpikpuk River.

Anadarko took two tracts bidding by itself for $155,356 and put out another $2,308,290 as a 30 percent partner with ConocoPhillips and Pioneer, for a total of $2.5 million.

ConocoPhillips Alaska bid $1,860,500 for eight tracts by itself, $2,871,540 in partnership with Pioneer and $3,847,150 in partnership with Anadarko and Pioneer for a total of $8,579,190.

Fortuna, bidding by itself, had $26,480,300 in high bids, 49 percent of the high bids at the sale.

Petro Canada, bidding by itself, had $13,614,835 in high bids, 25 percent of the high bids at the sale.

Pioneer, bidding in partnership with ConocoPhillips and Anadarko, and in another bidding group with ConocoPhillips, had $2,769,520 in high bids.

Henri Bisson, BLM Alaska state director, noted that the “area is far from the infrastructure developing along the eastern border of the reserve.” He said the agency is “gratified to see industry’s vote of confidence and willingness to invest in the future.”

TransCanada files application under Alaska’s Stranded Gas Act

TransCanada Corp. on Tuesday became the fifth entity to file an application under Alaska’s Stranded Gas Development Act, and is looking to be a participant in any deal to build a pipeline for moving North Slope natural gas to market.

The Calgary-based pipeline company said in its application a pipeline could be carrying gas seven years after commercial agreements are negotiated.

“We believe the Alaska gas pipeline could be in service by the first quarter of 2012 if shipping contracts for the full pipeline capacity are executed by mid-2005,” the company said. TransCanada proposed a 1,710-mile, 48-inch-diameter line from the North Slope to existing pipes in northern Alberta, carrying 4.5 billion cubic feet per day.

The company said in its application that it intends to own an equity interest in the pipeline, “the nature and size of that interest will be determined later as the commercial structure of the proposed pipeline project becomes better defined.”

In past announcements, TransCanada has said it is not looking to take on the market price risk of owning all the gas but rather wants to be part of the ownership structure of the line. The company also is looking for new gas supplies to help fill up its North America system, which will have a lot of spare capacity next decade as Western Canada production declines.

The state also has received Stranded Gas Act applications from the three major North Slope producers, Calgary-based pipeline operator Enbridge Inc., and MidAmerican Energy Holdings Co., which withdrew its application this spring. And the municipally owned Alaska Gasline Port Authority’s application is inactive, as the group elected to sign an information-sharing protocol with the state instead of negotiating a fiscal contract.

CORRECTION

A May 29 News Bulletin item incorrectly listed Larry Persily’s former positions with state government. Persily was a special assistant to the commissioner of the Alaska Department of Revenue from 1997-99. From 1999 to 2003 he served as a Revenue deputy commissioner.

Persily has been named a special assistant to Revenue Commissioner Bill Corbus, effective June 14.


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