Shallow gas leases being processed by state; 96 issued in Interior

Kristen Nelson

Shallow gas leases received in early 2000 are being processed and the first large group, 96 in the Interior, were awarded in early May.

Pirtle Bates of the Division of Oil and Gas said at a coalbed methane conference May 4 that the division was able to contract with a private consultant for title work for the shallow gas leasing program, and baring unforeseen problems, should have all of the leases awarded later this summer.

The state received 270 applications for the shallow gas leasing program early last year when the program began; 35 applications have been received since. Four leases were issued to Cominco for work in the area of the Red Dog mine and four others for the area were denied because Cominco’s had precedence.

One hundred leases were received for Interior areas. Four were rejected because the state had no lands in the area specified. The other 96, Bates later told PNA, were mailed the week of May 7.

There are 162 lease applications still being adjudicated in the Cook Inlet basin, primarily in the Matanuska-Susitna Borough.

Bates said the division hopes to have those leases out shortly.

The division said earlier this year that shallow gas leases would have to be issued after leases for competitive oil and gas lease sales because the state makes much more money from the competitive leasing program. Contracting with a private consultant for the work allowed the division to get the leases awarded.