NEWS BULLETIN

April 05, 2007 --- Vol. 13, No. 31April 2007

Division approves of expansion of Nicolai Creek participating areas

Alaska’s Division of Oil and Gas has approved the expansion of the south and Beluga participating areas in the Aurora Gas Nicolai Creek unit. The expansion recognizes that the gas producing stratigraphic intervals in the Tyonek and Beluga formations in the Nicolai Creek field extend over greater ranges of depth than were defined in the existing participating area approval. The new participating area expansion does not change the surface area committed to the participating areas.

Prior to the expansion the south participating area was defined as the interval between 2,422 and 2,918 feet measured depth in the Tyonek formation in the Nicolai Creek Unit No. 2 well. The Beluga participating unit was defined as the interval between 1,320 feet and 1,477 feet measured depth in the Beluga formation in the Nicolai Creek Unit No. 9 well.

The south participating area now extends to the Tyonek formation intervals between 2,240 feet and 4,227 feet measured depth in the Nicolai Creek Unit No. 2 well, and between 2,187 feet and 3,757 feet measured depth in the Nicolai Creek Unit No. 1B well, underlying the portions of tracts 2, 3 and 4 of the Nicolai Creek unit committed to that participating area. The Beluga participating area now extends to include the “producing and prospective intervals” in the Beluga formation from 668 feet to 1,904 feet measured depth in the Nicolai Creek Unit No. 9 well, underlying the portions of tracts 2, 3 and 4 of the Nicolai Creek unit committed to the Beluga participating area.

Aurora applied for the participating area expansion in July 2006. In October 2006 the company obtained approval from the Alaska Oil and Gas Conservation Commission to produce gas from the expanded participating areas, pending Division of Oil and Gas approval of the expansion.


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