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BP joins Anadarko, Alberta Energy in foothills gas exploration Anadarko called area gas-prone last year; expressed concern about access to a future gas pipeline Kristen Nelson PNA Editor-in-Chief
BP Exploration (Alaska) Inc. is joining Anadarko Petroleum Corp. and Alberta Energy Co. Ltd. in exploring for natural gas on more than 3 million acres in the foothills region. Anadarko said Feb. 19 that BP has acquired a one-third interest in Anadarko’s exclusive agreement with Arctic Slope Regional Corp. covering approximately 3.1 million acres.
In exchange, Anadarko received a material interest in a satellite prospect near Prudhoe Bay and an interest in selected seismic surveys on the North Slope. The companies did not disclose where the satellite prospect is located. The Anadarko-ASRC agreement was signed in 1998; AEC became a one-third partner last year.
BP will also purchase a one-third interest in approximately 230,000 acres of state leases jointly acquired by Anadarko and AEC at the state’s November 2000 North Slope areawide lease sale. AEC will retain its one-third interest. The purchase amount was not disclosed. That acreage is in two large adjacent blocks on the east side of the North Slope south of Point Thompson and Badami.
“Anadarko is actively searching for natural gas on the North Slope, and we see a lot of potential there to help meet the increased demand for natural gas in the Lower 48,” said John N. Seitz, Anadarko president and chief operating officer. “BP is already a major producer on the Slope, and we’re proud to be partnering on these efforts with both BP and AEC.” Exploration under way “With the company’s huge frontier acreage position it’s helpful to share the risk with an experienced partner,” Anadarko spokesman Mark Hanley told PNA. He said BP has drilled in the foothills area in the past.
Anadarko has two seismic crews going right now in the area from the Canning River to the Colville River and south not quite to Anaktuvuk Pass as part of a multi-year program on Arctic Slope and state lands.
The company has already gathered and reprocessed old seismic from the area, and would like to drill in the area next winter, but Hanley said they want to look at the new seismic before drilling. Gas transportation a concern Greg Pensabene, vice president of government relations and public affairs for Anadarko in Washington, D.C., told the Resource Development Council’s annual conference last year in Anchorage that the company was looking at five separate plays in the foothills, but said it was concerned about space in a prospective gas pipeline for discoveries yet to be made.
“Before we undertake these multi-billion-dollar exploration and development projects, we have to be assured there’s room in the pipeline for new gas. So we believe it’s important that the companies who will be developing new gas resources in Alaska have a seat at the table in planning for new pipelines.”
Anadarko’s concern is with timing, Pensabene told PNA:
“What can happen is that before we make a discovery, before developing a discovery, all of the space in the pipeline could potentially be committed and the only way we could get into the pipeline at that point would be to buy out someone else, and that could be very expensive.”
The difficulty for Anadarko could come, Pensabene said, if that open season on pipeline space occurs before the company has gas ready to put in the pipeline.
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