Alaska Venture Capital Group and its operating subsidiary Brooks Range Petroleum have acquired a third partner for their North Slope oil and gas acreage.
Calgary-based Bow Valley Energy Ltd. said Oct. 23 that its has signed a joint venture agreement with AVCG and Brooks Range under which it will participate in this winter’s exploration program and “pay 28 percent of specified capital expenditures in exchange for a 20 percent working interest in lands owned by AVCG.”
Robert G. Moffat, president and chief executive officer of Bow Valley, said the joint venture “is a first step in establishing Alaska as a major production and revenue contributor to Bow Valley’s operations.”
AVCG managing director Ken Thompson told Petroleum News that Brooks Range is “fully funded for exploration for the next three years. Upon discovery, depending on the discovery size, AVCG may have to obtain additional investment funding for development. Some energy investment firms have voiced interest already when we're successful.”
Bow Valley said the “co-venturers have approved a budget of US$41.3 million for 2006 and calendar year 2007, which encompasses the cost of drilling two wells and acquiring seismic. A third well may be drilled if conditions permit.”
In its Oct. 23 press release, Bow Valley, an independent oil and gas producers with operations in western Canada and the U.K. sector of the North Sea, noted that its farm-in acreage on the North Slope acreage is “in close proximity” to major producing oil fields such as Prudhoe Bay.
“Participation in this joint venture represents a major initiative to expand the company’s business into new international jurisdictions,” Moffat said. “Alaska is a politically stable jurisdiction, it has an attractive fiscal regime and there is significant exploration potential remaining within close proximity to existing infrastructure. We believe this opportunity is similar to the offshore U.K. where the company has been extremely successful in establishing a significant production base by pursuing smaller opportunities that are no longer considered material to the established major oil companies operating in the area.”
Note: See fully story in Oct. 29 issue of Petroleum News, available online at noon Friday Oct. 27.