Pioneer terminates Cosmopolitan unit

Pioneer Natural Resources voluntarily terminated the Cosmopolitan unit on Feb. 11.

The Texas-based independent made its decision about the offshore Cook Inlet unit in a letter to the Alaska Department of Natural Resources and the U.S. Bureau of Ocean Energy Management, Regulation and Enforcement. The joint state and federal unit sits along the coast of the southern Kenai Peninsula near the town of Anchor Point.

Pioneer said it is not surrendering any leases in the unit that have wells certified as capable of producing in paying quantities, pointing to ADL 384403 and ADL 18790.

Pioneer announced plans to leave Cosmopolitan earlier this year, but outstanding work commitments in the unit agreement put the short-term status of the leases into question.

All seven leases in the former unit are past their initial lease terms, meaning that any leases not held by certified wells or by production would expire and be released.

Although Pennzoil discovered the field in 1967, ConocoPhillips formed the Cosmopolitan unit in 2001 and delineated the prospect over several years.

Pioneer acquired an interest in Cosmopolitan in 2005 to follow up on earlier oil discoveries, but despite “encouraging” well results it decided not to pursue development after subsequent flow tests led it to reduce its estimates of the size of the field.

The acreage is primarily oil prone, but is believed to contain significant gas reserves.

Other major leaseholders in the area include Apache, Armstrong and Buccaneer.

—Eric Lidji