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Linc finds natural gas with LEA No. 1 Point MacKenzie wells finds several ‘gas bearing horizons’ and ‘significant coal seams’; company now planning Trading Bay well Eric Lidji For Petroleum News
Linc Energy’s first Alaska well encountered “a number of gas bearing horizons” and “a number of significant coal seams,” the Australian-independent announced on Nov. 18.
Linc Energy drilled the LEA No. 1 well to a target depth of 6,323 feet. Linc, which spud the well in late October, said it completed the drilling program on time and on budget.
LEA No. 1 is an onshore vertical well near Point MacKenzie.
After completing the well, Linc ran and cemented 7-inch casing. Now, the company is planning tests to measure the potential of commercial gas production from the prospect.
“In light of the fact that Linc Energy took over these leases in June, it is an exceptional result that by October, our team planned and permitted a drill site, built the pad, contracted the rig and spudded the LEA No. 1 well. The safe completion of the well to depth, within budget and time is also a fantastic outcome,” Linc Energy CEO Peter Bond said in a prepared statement. “It will now take our team about a month to conduct the relevant tests upon LEA No. 1 to define a commercial outcome. I am very excited about the opportunity that Alaska offers, particularly for the potential for early cash flow to Linc Energy.”
Close to Enstar line If the geology works out, LEA No. 1 is well positioned for commercial production. The well site is located less than two miles from a 20-inch Enstar Natural Gas pipeline.
Point MacKenzie exploration dates back to various efforts throughout the 1960s by the likes of Union Oil Co. of California, Atlantic Richfield and Pan American Petroleum that encountered coal seams, but not commercial amounts of oil or natural gas.
At a total depth of 6,323 feet, the LEA No. 1 well is shallower than the undrilled Frontier Spirit No. 1 well, permitted at the same general location by former leaseholder GeoPetro.
At the time, GeoPetro said it wanted to test a conventional gas prospect in the middle and lower Tyonek formations, at a depth of about 8,000 feet in an 11,500-acre structure.
Linc said it drilled LEA No. 1 into “basement volcanic rocks.” In addition to the gas bearing horizons, Linc said that it encountered several coal seams during drilling, adding that “coal is recognized as the source rock for all the gas discovered and produced from the prolific Tyonek, Beluga and Sterling formations in the Cook Inlet basin.”
While Linc is starting its tenure in Alaska focusing on conventional natural gas supplies, the company as a whole is more focused on an unconventional technology called underground coal gasification, which produces synthesis gas from deep coal deposits.
Linc previously said it planned to use revenue generated from conventional gas drilling in Alaska to eventually fund that underground coal gasification operation.
Prepping Trading Bay well As Linc prepares to test LEA No. 1, it is concurrently planning “phase two” of its local natural gas drilling program, focusing on its onshore leases at Trading Bay, on the west side of the Cook Inlet basin, south of Tyonek. Linc has yet to release much information about its target at Trading Bay, but GeoPetro previously discussed a prospect called Cottonwood Creek based on natural gas shows in the Tyonek sandstones that Shell apparently encountered in 1967 while looking for oil in the deeper Hemlock formation.
Like LEA No. 1, the Trading Bay leases are located near existing infrastructure.
Linc arrived in Alaska in March, acquiring 123,000 acres from San Francisco-based independent Geo Petro. Through the deal, GeoPetro will get $4 million from the first 75 percent any future production on the acreage, followed by a 10 percent overriding royalty on oil or gas production from leases owned by the state or the Alaska Mental Health Trust and 7 percent from production on leases held by Cook Inlet Region Inc.
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