Hilcorp Alaska has completed its takeover of Marathon Oil Co.’s Cook Inlet oil and gas assets, Hilcorp spokeswoman Lori Nelson confirmed to Petroleum News by email today.
The purchase transaction was completed Jan. 31, Nelson said.
The assets that Hilcorp has purchased include 10 fields in the Cook Inlet basin, three gas storage facilities, two gas pipelines and the remaining interests in two other gas pipeline systems.
Hilcorp originally announced its agreement with Marathon over the purchase of Marathon’s assets in April 2012, but an investigation by the Federal Trade Commission and the State of Alaska into competitive concerns over the purchase delayed purchase completion — with Hilcorp already having purchased Chevron’s Cook Inlet assets, Hilcorp would become the dominant gas producer in the basin.
With something of a hiatus over new gas development in Marathon’s assets while the sale of the assets was in progress, Southcentral Alaska power and gas utilities, already hard pressed to find adequate gas supplies from the aging Cook Inlet gas fields, became concerned about the length of time that the deal was taking to complete. Marathon has primarily been a gas producer in the basin. However, a consent decree agreed in November between the state and Hilcorp paved the way for the purchase of the Marathon assets to proceed.
Hilcorp has adopted an aggressive strategy for developing oil and gas resources in its Cook Inlet properties.
“Providing a reliable energy source for Southcentral is a priority for Hilcorp,” Nelson said in response to a question about what the completion of the purchase might mean for Cook Inlet gas production. “We’re committed to a long-term capital investment plan that aims at slowing decline and increasing production from Cook Inlet’s existing, aging fields.”
See story in Feb. 17 issue, available online Friday, Feb. 15 at 11 a.m. at PetroleumNews.com