April 26, 2002 --- Vol. 8, No. 47April 2002

Northstar Energy looking at building gasline from Ninilchik to Anchor Point

Northstar Energy Group Inc. said today it is in discussions with investor groups about building a gas pipeline from Ninilchik to Anchor Point and is studying the feasibility of a distribution line from Anchor Point to Homer.

Unocal Alaska’s announcement yesterday that the Kenai Kachemak Pipeline would be built only between Kenai and Ninilchik, not to Anchor Point as originally planned, might prove to be a “golden opportunity” for Northstar Energy, Keith Summar told PNA. Summar is vice president of exploration for the Tulsa-based independent, which purchased Alaska-based Gas-Pro LLC in 2000 and has more than 22,000 net acres of oil and gas leases on the Lower Kenai Peninsula.

Summar said building a gasline to the lower peninsula was something Northstar Energy was looking at before Unocal and its partners announced they were planning a pipeline that would bring natural gas to Anchor Point.

Northstar Energy’s gasline from Ninilchik to Anchor Point will follow the same route as proposed by Unocal and its partners — Marathon Oil Co., Alaska Electric Generation and Transmission, of which Homer Electric Association is the primary owner, and Alaska Pipeline Co., a subsidiary of Enstar.

Northstar Energy plans to meet with the permitting agencies in the near future. Summar said the company will apply for “a certificate of authority from the Alaska Public Utilities Commission for the purposes of delivering gas from Ninilchik south to Anchor Point and Homer.”

Northstar Energy pleased with North Fork well test

Northstar Energy Group Inc. released test results today from a previously shut-in well at its North Fork gas field, which is eight miles east of Anchor Point.

The Tulsa-based independent said the well “tested at more than 4.2 million cubic feet of gas per day from one sand. Other test information indicated that significant additional production could be achieved by perforating other sands in the well.”

Northstar Energy intends to drill an offset to the well during this calendar year, Keith Summar, vice president of exploration, told PNA.

The North Fork unit is a shut-in gas field that was previously owned and operated by Unocal Alaska, Summar said. It was purchased by Gas-Pro LLC, which, in turn, was bought by Northstar Energy in 2000.

The company has not decided whether it will permit the well for gas or for both gas and oil, Summar said.

“We think the field has significant potential for oil but permitting is much simpler for gas,” he said.

An oil well requires an oil spill contingency plan that must be approved by the Alaska Department of Environmental Conservation. A gas well doesn’t need a spill plan, he said.

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