June 24, 1998 --- Vol. 4, No. 35June 1998

State’s first areawide lease sale brings in $55 million

The state’s first areawide oil and gas lease sale brought in more than $55 million in high bids.

That makes it the fourth most successful state sale — topped only by the $900 million 1969 Prudhoe Bay sale, the $567 million 1979 Beaufort Sea sale and the $65 million 1993 Cook Inlet sale.

Thirteen bidders and bidding groups placed 168 bids on 139 tracts of the 1,275 tracts offered.

The total of high bonus bids was $55,063,172, averaging $98.67 an acre for 558,080 acres. The total of all bids was $61,783,524. The highest amount bid for a tract was $4,786,560 by the bidding group of ARCO Alaska Inc. and BP Exploration (Alaska) Inc. for a tract south of the new Tarn development west of the Kuparuk River field; that tract also had the highest per acre bid amount, $831.

Big dollars for tracts south of Tarn

The big money was on the western side of the North Slope, primarily to the south of existing leases: Of 34 tracts drawing high bids of $100 an acre or more, 18 are south of Tarn, eight are south of Kuparuk and one west of Kuparuk. Only seven are on the east side: two west of Badami, one south of Badami and four southeast of Deadhorse. Tracts receiving bids at this sale extend areas of leasing to the south by half again the previous distance from the Beaufort Sea on the west side of the North Slope. Prior to this sale, only BP held leases far south of Tarn and Kuparuk.

The second highest bid, $536 per acre, was also from ARCO/BP and also for a tract south of Tarn. ARCO Alaska, bidding by itself, bid $535 per acre and $505.15 per acre for two other tracts south of Tarn. Independent John Winther of Petersburg had the fifth highest per-acre bid, $437.80 an acre for a tract adjacent to the western edge of the Badami unit.

Amounts by bidders

Bidding by itself, ARCO Alaska took 38 tracts for $17,572,736. The ARCO/BP bidding group took eight tracts for $12,907,296. BP Exploration (Alaska) bidding by itself took 22 tracts for $6,164,100.

Anadarko Petroleum Corp. took 20 tracts for $5,450,425.60, and an additional six tracts for $5,321,593.60 in partnership with Petrofina Delaware. An ARCO/Chevron bidding group took 13 tracts for $4,894,560 and John Winther took three tracts for $1,762,969.60.

Keith Forsgren took 14 tracts for $533,862.40, Chevron took four tracts for $255,974.40 and a bidding group of Gilbertson/Wagner took four tracts for $63,872. An ARCO/Murphy Petroleum bidding group took two tracts for $52,992, the Burglin/Vondra bidding group took four tracts for $51,200 and Alfred James took one tract for $31,590.40.

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