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Buccaneer Energy acquires more Cook Inlet acreage
Kristen Nelson Petroleum News
Buccaneer Energy Ltd. said May 26 that its wholly owned subsidiary Buccaneer Alaska LLC has entered into a binding agreement to acquire between a 50 percent and 100 percent working interest in four leases on the North Middle Ground Shoal structure in Cook Inlet, 8,828 gross acres and 6,322 net acres.
Buccaneer said the acquisition consolidates ownership on the geological structure with a lease previously acquired from Stellar Oil and Gas LLC and gives Buccaneer “a controlling position on this low risk opportunity.”
Buccaneer said the new acreage includes a well drilled in the 1960s by Pan American that tested at 3.4 million cubic feet per day of gas. That production rate was from one of three identified gas lobes penetrated by the well in the Upper Tyonek formation. The company said oil was tested in the Lower Tyonek, but the discovery was not considered commercial at the time due to low commodity prices.
Buccaneer is acquiring a 50 percent working interest in leases ADL 391108 and ADL 17595-2 and a 100 percent working interest in ADL 390379 and 390370. The company said Chevron holds the remaining 50 percent working interest in ADL 391108 and 390370.
Cook Inlet Energy acreage State records shows that ADL 390370 and 39079, the leases in which Buccaneer is acquiring 100 percent interest, are currently held by Cook Inlet Energy LLC and have expiration dates of Sept. 30.
ADL 391108, in which Buccaneer is acquiring a 50 percent interest, is held 50 percent by Cook Inlet Energy and 50 percent by Chevron subsidiary Union Oil Company of California; the lease expires Sept. 30, 2014. ADL 17959-2 is also currently held 50 percent by Cook Inlet Energy and 50 percent by Chevron subsidiary Union Oil Company of California and is shown in state records as held by a well capable of production.
Buccaneer, which began acquiring Alaska acreage with an acquisition of 57,600 onshore and offshore Cook Inlet acres from Stellar Oil and Gas earlier this year, was apparent high bidder on three other Cook Inlet leases at the state’s May 26 areawide oil and gas lease sale.
Buccaneer is an Australian-based independent which attributed its interest in Alaska to tax credits and local natural gas prices.
In March the company called exploration credits in Alaska’s production tax, ACES (Alaska’s Clear and Equitable Share) “a significant incentive and substantially reduces the commercial discovery threshold.”
Buccaneer said the natural gas prices in Cook Inlet “trade at around 40 percent premium to the remainder of the United States due to declining production and increasing demand.”
The company also said the Cook Inlet basin is “significantly under explored” and pointed to “numerous studies” suggesting the inlet has the potential to “host additional world class reserves.”
—A copyrighted oil and gas lease map from Mapmakers Alaska was a research tool used in preparing this story.
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