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True North joins Savant in Kupcake venture Texas independent caps ground-breaking first year with moves to advance interests on Alaska North Slope and in Cook Inlet Rose Ragsdale For Petroleum News
True North Energy Corp. of Houston, Texas, said Dec. 6 it has entered into a letter of agreement to join Savant Resources LLC in exploration of the Kupcake prospect on Alaska’s North Slope, a gambit the companies hope will pay off with a discovery of more than 100 million barrels of recoverable crude.
The Kupcake prospect is located adjacent to the 130 million barrel Liberty field discovered by BP Exploration (Alaska) Inc. east of Prudhoe Bay.
The publicly held independent said it will pool leases that it owns covering about 120 acres with Savant’s 1,291 acres within the Kupcake prospect on a net acreage basis in a non-cash deal. Savant will own about 91.55 percent working interest in the pooled area, while True North Energy will hold a 8.45 percent stake, the company said.
True North Energy also said it will join Savant in drilling a test well in Kupcake early next year. Denver-based Savant, a privately held independent, will act as operator for the venture and plans to drill to a depth of 11,000 feet in section 29, T11N, R18E, UM in order to test the Kemik formation.
Savant previously announced plans to secure a drilling rig and permitting for the well. The drilling operation is scheduled to begin in the first quarter of 2007.
True North Energy said Savant estimates that the Kupcake prospect contains more than 200 million barrels, of which about 50 percent are recoverable.
True North Energy has a total of 10,000 leasehold acres adjacent to the Kupcake prospect and is currently considering acquiring all available 3-D seismic that covers about one third of its North Slope acreage, the company said.
True North also in Cook Inlet True North, one of the few newcomers to Alaska’s oil patch that own acreage in both of the state’s major oil and gas basins, also said it has commissioned an independent evaluation of its Harriet Point prospect in Cook Inlet.
“We are extremely pleased to be able to participate in our first Alaska well during the first year of our company’s operation and with an experienced industry operator like Savant,” said True North Energy President John Folnovic.
True North Energy also said it hired Rose and Associates of Houston to conduct an independent technical evaluation of the resource potential of True North Energy’s Harriet Point prospect.
Rose and Associates is a leading consulting firm and specializes in providing unbiased characterization and probabilistic play and prospect evaluations of some of the world’s most challenging plays and prospects, True North Energy said.
In addition to a potential resource estimate, Rose and Associates will reinterpret and re-map the prospect based on True North Energy’s existing 33 miles of seismic data.
True North currently has 25,000 leasehold acres in the Cook Inlet area, which it owns 100 percent.
Test well planned at Harriet Point The independent also hired Michael Baker Corp.-Energy Division, to provide estimated project timelines and turnkey drilling and associated services costs for a test well on the Harriet Point prospect.
True North Energy said Rose and Associates and Michael Baker should complete their work early next year.
“I believe that the experience gained by participating in the drilling of the Kupcake well and the work undertaken by Rose and Associates and Michael Baker Corp. will allow us to significantly advance our understanding and development of our Harriet Point prospect,” Folnovic added.
True North Energy also said Nov. 28 that it has raised another $1 million in equity financing through a private placement that will be used to fund the company’s drilling participation programs and to increase its working capital.
“To date, True North Energy has raised in excess of $6 million in equity financing, while at the same time not incurring any debt,” observed Folnovic.
“This latest financing will allow True North Energy to participate in recently undertaken drilling programs. This round of financing also has increased our working capital, giving us greater operating flexibility and an ability to advance important technical work on our Alaska exploratory acreage ahead of schedule,” he added.
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