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NEWS BULLETIN

June 04, 2010 --- Vol. 16, No. 49June 2010

Escopeta files for 180-day extension on Kitchen Lights drilling

Escopeta Oil and Gas has requested a 180-day extension for first-year work commitment items for the Kitchen Lights unit in Cook Inlet.

Company President Danny Davis said in a May 30 letter to Kevin Banks, director of the Alaska Department of Natural Resources, Division of Oil and Gas, that the 180-day extension would only affect the year-one commitment in the initial five-year plan of exploration, and would allow for the drilling of two wells within the Kitchen Lights unit between May and November of 2011, bringing the work commitment schedule current by Dec. 31, 2011.

Davis said the company’s current five-year plan of exploration requires: all necessary permits to be in place by June 30 of this year; a jack-up drilling rig loaded on a heavy-lift vessel on the way to Cook Inlet by June 30; and spudding of the first exploration well in the Kitchen Lights unit by Dec. 31.

He said Escopeta was unable to secure a drilling rig contract in time for transportation of the rig to Cook Inlet and expects that the earliest a jack-up rig could be loaded for delivery to Cook Inlet is early next year, making the earliest arrival of the jack-up in Cook Inlet March of 2011.

He said considerable work has been done since formation of the unit last year, but the listing of the beluga whale as an endangered species and the proposal to designate the entire 3,000 square miles of Cook Inlet as critical habitat, combined with the recent oil spill in the Gulf of Mexico, have “cancelled one overseas partnership and deferred plans with another major U.S. independent oil company.”

Editor’s note: See stories in the June 13 issue, available online to subscribers at noon Alaska time Friday, June 11.

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