Forest Oil bullish on Cook Inlet gas

Forest Oil Corp. expects its gas production business in the Cook Inlet to expand. That was one of the messages that CEO Craig Clark delivered at Forest’s third quarter 2005 earnings release teleconference on Nov. 10.

“I believe we can build that area into a business unit on the gas alone — that’s my objective,” Craig said.

After starting from zero not too long ago the company’s net gas sales have reached 8 million cubic feet per day, he said. Craig expects this rate to go higher as production ramps up from new and existing wells.

“We have three wells in progress at this time in the Cook Inlet,” Craig said. “One is the delineation well at the Three Mile Creek discovery that was drilled and put on line earlier this year, and two are near our West Foreland area.”

Including these three wells, the company expects to have added as many five wells, all of them onshore, by the end of the year. At Three Mile Creek Forest is partnering with operator Aurora Gas.

And Forest has been adding to its Cook Inlet exploration acreage.

“We’ve also added another 9,000 acres around one of these prospects at a recent lease sale in Alaska — all of this is onshore,” Craig said, presumably referring to the company’s lease purchases on either side of the Three Mile Creek unit at the Alaska Mental Health Trust Authority’s Nov. 2 lease sale.

—Alan Bailey