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Pretty Creek gas storage lease extended
Kristen Nelson Petroleum News
In June 2024 Hilcorp Alaska requested an extension of its lease for the Pretty Creek Gas Storage lease. The lease was granted in October 2005 with a 10-year primary term existing at the end of September 2015. The lease allowed for a single 10-year renewal.
In 2015, the lease was extended for another 10 years.
In its June 2024 request, Hilcorp Alaska asked for a 10-year extension, and also asked that the lease be amended to allow for up to two additional terms of 10 years, allowing the company to meet current and future market demands.
In its May 6 approval, the division said that modification of the lease to allow for "one or more additional 10-year terms" will allow the company to meet current and future market needs and align the Pretty Creek storage lease with the amended gas storage lease for Pool 6 in the Kenai Gas Field.
"Given the current and future forecasts of gas production and market needs," the division said it found that the state's interest was best served by according "storage flexibility to the operator to store gas to help ensure gas demand is met."
The new lease expiration date is Sept. 30, 2035, and the lease was amended to allow it "to be renewed for one or more 10-year terms."
Gas storage POD Also on May 6 the division approved Hilcorp's proposed 2025 plan of development for the Pretty Creek gas storage lease.
The lease is some 1,998.8 acres and uses two horizons for gas storage: Sterling 45-0 gas sands and Beluga 51-5 sands. The division said Hilcorp uses the PC-4 well for storge operations. As of the end of February, the lease has stored 9.63 billion cubic feet and withdrawn 8.84 bcf.
The division said Hilcorp does not have plans to expand or contract the Pretty Creek gas storage lease.
For the 2025 POD the company plans to continue using the lease for gas storage and continue evaluating installing a second compressor to allow production down to lower pressures at the pressure. The division said Hilcorp has not determined when a second compressor would be installed, with timing "contingent on the results of native gas production projects in the PCU-02 well or any future drill wells."
The company will pursue improvements -- wells, infrastructure, facility repairs -- as the need arises.
The division approved the 2025 for June 1 through May 31, 2026.
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