NEWS BULLETIN

October 19, 2005 --- Vol. 11, No. 84October 2005

Shell buys EnCana’s Beaufort Sea leases

Petroleum News sources say Shell has purchased all but five of EnCana’s 24 federal leases in the Beaufort Sea off Alaska.

EnCana has reportedly filed a request with the U.S. Minerals Management Service to have 19 outer continental shelf leases in the Beaufort assigned to Shell.

Calgary-based EnCana, which first entered Alaska in 2000 as Alberta Energy, has been dumping many of its conventional oil and gas assets worldwide, choosing instead to focus on North America resource (unconventional) gas plays and Alberta oil sands. Its Alaska assets were some of the last to be put on the market, with EnCana dropping its leases in the National Petroleum Reserve-Alaska in October 2004 and announcing its decision to sell its Beaufort Sea and Brooks Range Foothills assets in December 2004.

In mid-2005 EnCana sold its one-third interest in a Brooks Range Foothills joint venture involving approximately 1.5 million acres to partners Anadarko Petroleum and Petro-Canada.

The 24 Beaufort tracts encompassed some 52,265 acres.

ANWR drilling clears second round

The U.S. Senate Energy and Natural Resources Committee voted 13-9 Oct. 19 to authorize oil and natural gas drilling in the 1002 area of the Arctic National Wildlife Refuge in the mark up of its portion of FY06 budget reconciliation legislation.

Committee Chairman Sen. Pete Domenici, R-N.M., offered ANWR drilling as the sole means of meeting his committee's task of raising federal revenues by $2.4 billion. A Domenici spokesman said ANWR drilling authorization would increase revenues by $2.5 billion. Provision language called for two lease sales by 2010 and for the state of Alaska to receive half the proceeds from them.

Alaska and Hawaii’s delegations, meanwhile, jointly introduced a bill Oct. 19 that maps out specifics for oil and gas exploration on ANWR’s 1.5-million-acre coastal plain (1002 area). The measure, the Arctic Coastal Plain Domestic Energy Security Act of 2005, aims to provide full environmental protections and economic assistance to affected communities as part of legislation to open the Arctic coastal plain to oil and gas development, according to a statement from the delegations.

The measure, similar to traditional House-passed legislation to open ANWR to limited development, also conveys the last 2,000 acres of lands owed to the Kaktovik Inupiat Corp. and the Arctic Slope Regional Corp. stemming from the 1971 Alaska Native Claims Settlement Act.

Note: See both full stories in the Oct. 23 issue of Petroleum News, available online Friday, Oct. 21.


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