The Alaska Division of Oil and Gas is combining unleased acreage backed by publicly available information on those leases to offer three blocks of leases in its fall oil and gas lease sales.
Large contiguous acreage blocks in three North Slope and Beaufort Sea areas will be offered in a sale to be held concurrently with its annual fall 2018 competitive oil and gas lease sales.
“These unique lease sale blocks are groups of North Slope and Beaufort Sea Areawide lease sale tracts that will be offered together as Special Alaska Lease Sale Areas (SALSA),” Division of Oil and Gas Director Chantal Walsh said in describing the program on the division’s website.
She said the division “has gathered and highlighted large amounts of publicly available data that bears on the SALSA areas.”
The areas are: Harrison Bay on the coast west of the Colville River unit; Gwydyr Bay on the central North Slope coast, between Milne Point and Northstar north of Prudhoe Bay; and Storms, south of the Prudhoe Bay unit and immediately east of the Guitar unit.
The block sizes vary, with the Harrison Bay SALSA the largest at some 66,430 acres, followed by Storms at some 30,720 acres and Gwydyr Bay at some 23,040 acres.
Terms and conditions of the sale will be available in mid-August, Walsh said, when the public notice is released.
The data summary, available on the division’s website, http://dog.dnr.alaska.gov/Information/DocumentLibrary, includes links to information on the areas.
State as aggregator
The state is acting as aggregator with the SALSA program: it has identified areas based on availability of seismic and assembled the leases.
Although in the case of these blocks the areas have been previously leased, seismic has been shot and and in some cases wells drilled: the areas were just never developed.
The wells shown for the Harrison Bay SALSA appear to be outside the boundaries of the block, with the Atigaru Point No. 1 the closest, apparently adjacent to the northwest corner of the block. That 11,535-foot well was drilled in the National Petroleum Reserve-Alaska in 1976-77, was a legacy well tackled by the federal Bureau of Land Management in the early phase of cleanup and has been plugged and abandoned to the surface. South Harrison Bay 1 is just south of the block and Qugruk No. 4 is to the east.
There are six wells in the Gwydyr Bay SALSA block, including Northstar 3, Long Island 1, Gwydyr Bay wells either drilled in or with bottom holes in the block and the Sak River 1A which has a bottom hole in the block.
The Hailstorm 1 was drilled on the eastern edge of the Storms block; Hemi Springs Unit 3 is off the southeast corner of the block.
It appears from the division’s graphics that only the Sak River 1A flowed hydrocarbons to the surface.
Previously used
The division used a block bidding method in 2011 in Cook Inlet, grouping three tracts surrounding the Cosmopolitan unit into Part B of the two-part sale, requiring bidders to bid on all three tracts with a minimum bid of $50 per acre. The minimum bid for the remainder of the sale, Part A, was $10 an acre.
The division also required a work commitment for the Part B leases in that sale, with a lease plan of exploration required within six months of leases being issued, and the plan required to describe proposed exploration activities, including bottom-hole locations, depths of proposed wells and the estimated date when drilling would begin.
This was the sale dominated by Apache Alaska, which has since exited the state. Apache took 90 tracts in the 2011 sales for some $6.9 million (of 104 tracts sold in the sale for a total of $7.9 million) including the three tracts in Part B of the sale for $70 an acre.
3-D seismic available
Each of the SALSA lease blocks has 3-D seismic available, data which was acquired through the state’s tax credit program and is available through the Department of Natural Resources for a modest fee, Walsh said.
The SALSA information includes maps showing the blocks, where seismic is available and wells in the areas which flowed hydrocarbons to the surface.
There are links to the Alaska Oil and Gas Conservation Commission’s website, with a list of information available from AOGCC, and a link to the Division of Geological and Geophysical Surveys Alaska Geological Materials Center, and materials available there, as well as a list of information available from the division.
A bidding history for tracts in the blocks is included, and links to information sources on the leases.
Jump start
Walsh said the SALSA information “is meant to give you a jump start in understanding what data is available for the lease sale blocks,” with sources of data provided so searches can be expanded outside the SALSA file. “This rich and insightful information will help you interpret and evaluate Alaska’s resources more quickly,” she said.
Formal information on the fall sales will be posted as available at http://dog.dnr.alaska.gov/Services/BIFAndLeaseSale.
