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Only 3 tracts draw bids at state’s Cook Inlet oil and gas lease sale
Kristen Nelson Petroleum News
The state received only three bids at its 2019 Cook Inlet areawide oil and gas lease sale, all three from Hilcorp Alaska, and no bids in the Alaska Peninsula sale.
The Alaska Department of Natural Resources Division of Oil and Gas opened bids May 22 in Anchorage.
Hilcorp appeared to be filling in around existing acreage.
The company bid $20 an acre on tract 378 on the eastern edge of its offshore acreage at North Trading Bay. The other two tracts are on the Kenai Peninsula east of Cosmopolitan and north of Anchor Point. Hilcorp holds acreage in the Anchor Point area south of the adjacent blocks, tract 781 and tract 800, and to the northeast. The company bid $22 per acre on tract 781 and $16 an acre on tract 800, the more southerly of the two tracts.
Kyle Smith, the division’s leasing section manager, said at the bid opening that 10,286 acres received bids, for a total of $190,350.62.
The average high bid per acre was $18.50.
Fluctuating sales “We are pleased to see bid activity in the Cook Inlet lease sale. We recognize the focus of bidders has been on the North Slope in recent years. Nevertheless, significant investment is made to sustain current Cook Inlet production, while exploration activities continue to inform and support future development,” said DNR Deputy Commissioner Sara Longan, in a press release on sale results.
Cook Inlet is a mature basin. Sales results have varied a lot in the last 10 years, from no bids in 2016 to $8.2 million bid on almost 450,000 acres in 2011.
Most recently, when there have been bids, the acreage has been more in line with the May 22 bids: 20,840 acres in 2016, with $167,033 in high bids; 24,138 acres in 2017, with $836,502 in high bids; and 16,135 acres in 2018, with $289,792 in high bids.
There are currently no leases in the Aleutian Peninsula sale area. The last bids the state received there were in 2014, when $47,807 was bid on 9,561 acres.
- KRISTEN NELSON
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