Oil Patch Insider

Aurora lists Cook Inlet assets with broker; Linda Leary elected president of Carlile

Aurora Gas has placed its Alaska oil and gas assets for sale with Meagher Oil & Properties, a Denver-based acquisition and divestiture firm. According to Meagher’s Web site, Feb. 29 is the final bid date for making an offer on the Cook Inlet basin properties, with March 24 as the expected closing date, and April 1 as the effective date.

Meagher has the value of Aurora’s net gas reserves set at $202.6 million — $51.9 million for 16,805 million cubic feet of proved reserves; $73.3 million for of 23,148 mmcf of probable reserves; and $77.4 million for 24,588 mmcf of possible reserves.

But Aurora President Scott Pfoff told Petroleum News Jan. 17 that Aurora is open to several options, including an outright sale in which the present management team goes away and Aurora’s properties are absorbed by a new owner company, a new investor in Aurora Gas itself with the present management left in place, or some combination thereof.

“It’s time for a new owner with new money,” Pfoff said. “We’re actually excited about it.”

The Texas independent has been looking for partners or new investors to replace its major owner, Kaiser Francis Oil Co. of Tulsa, Okla., since last summer, which is why Aurora listed its assets with Meagher.

“We want to get the best deal we can for Kaiser Francis,” he said, referring to Kaiser Francis Oil Co. of Tulsa, Okla., which he said has been a great investor in Aurora during its initial years in Alaska when Aurora was tapping only known gas plays.

“They have a certain risk profile that they like to tackle and that’s what we’ve provided them,” Pfoff said in May 2007 about Kaiser Francis. But now that most of the low hanging fruits of bypass plays and well re-entries, involving known gas pools, have been worked, Aurora, or its properties, need a new investor or owner with an interest in more high-risk/high-reward projects, he said.

“We need a company that wants to invest the additional capital it takes to develop our undeveloped properties, and take a shot at the probable and possible reserves,” Pfoff said.

Aurora’s Cook Inlet assets include five west Cook Inlet fields with a total of 8 mmcf per day of natural gas production, 19 exploration prospects, 2-D and 3-D seismic, equipment, infrastructure and facilities.

According to information on Meagher’s Web page (http://listings.meagheroil.com/list_aurora.htm), Aurora’s acreage is mainly onshore, encompassing 113,000 gross acres (79,250 net).

As of December, Aurora’s gas production was from 11 producing wells in the Koloa, Lone Creek, Moquawkie, Nicolai Creek and Three Mile Creek fields, encompassing 24,800 gross acres (22,000 net). “Average net monthly operating income” from the five fields was $641,000, which reflected Aurora’s 2007 income through November, the R&D firm said.

Gas delivery options, Meagher said, include “local utility markets, Nikiski LNG plant and fuel gas for other Cook Inlet oil and gas operations,” and a water disposal well is in the permitting process “to reduce disposal costs and increase gas production.”

The 19 oil and gas prospects have “estimated net reserves of 247,600 mmcf” that are “located on-trend or adjacent to existing production,” Meagher said.

According to Meagher, some of Aurora’s Cook Inlet properties also have coalbed methane potential, in “primarily Oligocene to Miocene Tyonek formations,” with “San Juan basin geological type attributes,” that are “conservatively estimated at 8.4 billion cubic feet per section.”

Meagher geologist David Bickerstaff can be contacted at 303-721-6354, extension 232, for additional information.

—Kay Cashman

Editor’s note: Watch for full story in next week’s Petroleum News.

Linda Leary elected president of Carlile

The company said Jan. 15 that Leary will assume her new role March 1. Co-founder and current president Harry McDonald will continue to serve as chief executive officer.

Leary joined Carlile in 1985. She is currently vice president of sales and marketing in Carlile’s Tacoma, Wash., office. The company said Leary and her family will relocate to corporate headquarters in Anchorage.

Leary earned a master’s degree in global supply chain management from the University of Alaska and an undergraduate degree from the University of Maine.

“As Carlile continues to expand its operations and services, I look forward to working with our family of employees as we meet the challenges of our current and future customers,” Leary said.

McDonald said: “Linda has been instrumental to the growth of Carlile over the past 23 years and she has the unwavering support of the board of directors and our 635 employees.”

Leary participates in community programs and organizations including local chambers of commerce, industry associations, the Port of Tacoma and a variety of non-profit groups, including the Susan G. Koman Breast Cancer annual three-day walk for breast cancer research.

Carlile was founded in 1980 by brothers John and Harry McDonald and has grown from two tractors to one of Alaska’s largest trucking companies. The company is based in Anchorage and has 635 employees, including 110 in Tacoma.

Carlile terminals are located in Anchorage, Fairbanks, Kenai, Kodiak, Prudhoe Bay-Deadhorse and Seward in Alaska; Forest Lake, Minn.; Tacoma and Fife, Wash.; Houston, Texas; and Edmonton, Alberta.

The company is launching new service between the West Coast and Honolulu, Hawaii.

—Kristen Nelson

Editor’s note: Watch for full story in the first quarter 2008 Petroleum Directory magazine due out in March.