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NEWS BULLETIN

August 08, 1998 --- Vol. 4, No. 38August 1998

MMS receives 31 bids for Beaufort Sea sale 170

The U.S. Minerals Management Service said today that it had received 31 bids for tracts offered in federal Outer Continental Shelf oil and gas lease sale 170, Beaufort Sea. The bids were opened this morning in Anchorage.

MMS offered 241 whole and partial blocks encompassing about one million acres offshore Alaska’s North Slope, extending from the Colville River east toward the Canning River.

High bids totaling $6,239,015 were submitted on 29 tracts. The highest bid received was $911,922, submitted by BP Exploration (Alaska) Inc. for block NR06-03 which is offshore near Beechey Point.

Bidders included BP separately and in conjunction with Chevron USA, ARCO Alaska Inc. in partnership with Chevron, Petrofina Delaware Inc., Petrofina co-bidding with BP, and Phillips Petroleum Co. Inc.

All tracts leased were in the Beechey Point area except for five tracts near Flaxman Island. Three of those tracts were leased by Petrofina; one to co-bidders BP and Petrofina; and another to bidding partners BP and Chevron.

ARCO Alaska, Chevron form North Slope alliances

ARCO Alaska Inc. and Chevron USA Inc. said today that they have signed joint exploration agreements aimed at quickening the pace of exploration on more than 2.8 million acres on Alaska's North Slope between the Colville and Canning Rivers. The 2.8 million acres includes ARCO and Chevron state and federal leases, as well as open acreage between those leases, ARCO spokesman Dawn Patience told PNA.

The agreements provide for equal ownership of leases, including those acquired in this morning’s U.S. Minerals Management oil and gas lease sale (see adjacent article) and the recent Alaska state areawide lease sale 87.

The first agreement between the two companies provides for joint exploration and appraisal of an approximate 4,000-square-mile area. This area includes open acreage and leases acquired by ARCO and Chevron during lease sale 87. Under the terms of the agreement ARCO and Chevron will each own 50 percent interest in 35 tracts, representing approximately 200,000 total gross acres, located southwest of the existing Kuparuk and new Alpine oil fields. This includes 13 jointly acquired leases, in addition to four tracts purchased by Chevron and 18 tracts acquired by ARCO at lease sale 87. ARCO has been designated as exploration and development operator in the agreement.

A second alignment agreement encompasses the McCovey/Salmon area, which includes 196,000 offshore acres north of the Prudhoe Bay oil field in the Beaufort Sea. Under the agreement, ARCO and Chevron will each have one-half interest in 16 tracts in this area. ARCO has been designated as exploration and development operator for the project.

The next step, said Patience, is an evaluation of “the leases we just picked up this morning and see how that fits into our long-term exploration program.”

ARCO and Chevron are already partners in the eastern North Slope offshore Hammerhead and Kuvlum units. ARCO acquired these federal leases during its merger with Union Texas Petroleum Holdings, Inc. Union Texas is now a wholly owned subsidiary of ARCO. Chevron is the designated exploration and development operator in the Hammerhead and Kuvlum.

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