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Cook Inlet Energy to begin gas sales
Cook Inlet Energy LLC says it has secured a new natural gas commercial sales agreement.
The Anchorage-based company did not name the other party, or disclose terms of the deal, in a May 6 press release.
Contractual gas sales will commence before the end of May at an estimated volume of 1 million to 3 million cubic feet per day, the company said.
The gas will come primarily from the RU-3 and RU-4 wells on the company’s Osprey platform in the offshore Redoubt unit, the company said.
The gas sales are a byproduct of Cook Inlet Energy’s efforts to establish a flow of gas to fuel its own oil field operations.
Forced to buy gas last year The company found itself in a jam in 2012 when it was forced to buy very expensive fuel gas on the open market. That prompted Cook Inlet Energy to rush workovers of the RU-3 and RU-4 gas wells.
Now the company has enough gas production to begin commercial sales.
Cook Inlet Energy is a subsidiary of Miller Energy Resources Inc., a publicly traded company based in Tennessee.
“We have been running RU-3 and RU-4 at less than their full potential flow rates,” said Scott Boruff, Miller chief executive. “This new contract allows us to optimize well production, bringing additional return on investment in our Cook Inlet assets while continuing to provide sufficient gas to run our own operations.”
Longer term, Cook Inlet Energy is hoping to develop a string of onshore gas prospects on the inlet’s west side, including Otter, Olsen Creek and Kroto Creek.
The company already has drilled an exploratory well at Otter, and has said it expects to spud a well no later than June 15 at Olsen Creek.
—Wesley Loy
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