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TG World, Brooks Range deal sealed Companies plan 3-D seismic purchase, further lease acquisitions, possible farm-ins, drilling of up to three North Slope wells in 2006-07 Alan Bailey Petroleum News
TG World Energy Corp. said May 17 that it and Brooks Range Petroleum Corp. have signed the joint operating agreements for their joint venture for exploration on Alaska’s North Slope. The two companies announced the formation of the joint venture in March (see “TG World Energy, AVCG/Brooks Range form Alaska North Slope JV” in the March 26 edition of Petroleum News). Brooks Range, operator of the leases that come within the joint venture, is a wholly owned subsidiary of Alaska Venture Capital Group LLC.
In March TG World said that the joint venture is exploring properties that “can be grouped into seven highly prospective play/lease areas,” including Gwydyr Bay, Itkillik, Ocean Point, Slugger, Southland, Titania and Whiskey Gulch. Ken Thompson, managing director of Alaska Venture Capital Group, has described most of these prospects as being in the “the billion-dollar fairway,” a particularly prospective area west and southwest of the Kuparuk River and Milne Point units.
Cronus on trend with acreage In a May 17 press release TG World commented that the recently announced oil discovery at Pioneer Natural Resources’ Cronus No. 1 well lies on a geologic trend that passes through Brooks Range/TG World leases just 1 to 2 kilometers from the Cronus discovery. The joint venture leases near to Cronus include the Itkillik River prospect and “a number of other leases covering exploration prospects close to and surrounding the Cronus prospect,” TG World said.
“Management of TG World is encouraged by the news that the Cronus No. 1 exploration well — just 2 to 3 kilometres from certain JV prospect leases — encountered ‘a thick, oil bearing sand section’,” said Clifford James, president and CEO of TG World. “… This further increases the areal extent of known oil charge in the emerging Beaufortian and Brookian fairways in this area, and proves oil presence in nearby proximity to the multiple prospects covered by JV leases.”
TG World said the joint venture with Brooks Range Petroleum “contemplates further analysis of the various JV prospects on the Alaska Central North Slope, with a view to identifying a short list of drillable prospects for the coming three winter operating seasons. The work program for the balance of 2006 and for the 2006-7 winter drilling season is expected to include 3D seismic data purchases, further lease acquisitions, possible farm-ins and the drilling of up to three wells.”
TG World expects its share of the joint venture exploration program to cost $7 million to $10 million. However, under the terms of the joint venture agreement, the company can elect not to participate in any part of the program. But the company will forfeit its property interest in any lands associated with a part of the program that the company does not participate in.
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