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THE EXPLORERS 2006 - Petro-Canada advances in Alaska Has 1.6M net acres of leased, option lands in Alaska; looking at drilling 2-3 exploration wells in 2007-08 Petroleum News
In late 2004 Petro-Canada’s chief executive officer, Ron Brenneman, said the company planned to develop “long-term” natural gas supply opportunities on Alaska’s North Slope in expectations that a gas pipeline would be built to from northern Alaska to outside markets in the next few years.
Two years later the Calgary-based company has amassed National Petroleum Reserve-Alaska and Brooks Range Foothills (also referred to as the North Slope Foothills) area to 1,574,000 net acres of leased and option lands. It’s been even more aggressive across the border in what it refers to as the Mackenzie Delta/Corridor.
And in addition to partnering with Talisman Energy’s FEX in NPR-A and Anadarko Petroleum and the BG Group’s Alaska subsidiary in the Foothills and other parts of the North Slope, Petro-Canada is looking at operating its first wells in northern Alaska in the winter drilling season of 2007-08.
It’s all part of Petro-Canada’s North America natural gas strategy.
According to the company’s 2005 annual report, key features of the strategy include:
• transitioning further into unconventional gas plays;
• optimizing core properties in Western Canada and developing coal bed methane and tight gas in the U.S. Rockies;
• stepping out of traditional operating areas, with an increased focus on exploration; and
• building the northern resource base for long-term growth.
Action plans in 2006 include:
• drill approximately 500 gross wells in Western Canada and approximately 450 gross wells in the U.S. Rockies;
• advance long-term opportunities in Northern Canada and Alaska.
Petro-Canada said “a modest exploration program and land acquisition plan is expected in the Alaska and the Mackenzie Corridor until such time as pipeline timing becomes clear.”
Oil as well as gas In Alaska the company’s subsidiary is Petro-Canada (Alaska) Inc.
Oilfield service contractors have been told the company is looking at drilling two to three exploration wells in either NPR-A or the gas-prone Foothills in 2007-08 with a drilling rig it expects to bring in from outside the state.
NPR-A is considered both oil and gas prone.
High bidders in NW NPR-A As of Oct. 26, 2006, Petro-Canada’s most recent land acquisition in Alaska was at the U.S. Bureau of Land Management’s Sept. 27 oil and gas lease sale in the northwest planning area of NPR-A.
More than $10 million of the $13 million in high bids received at that sale came from a partnership of FEX (formerly Fortuna Exploration) and Petro-Canada, the two companies who, bidding separately, were the largest bidders in the first northwest planning area sale in 2004.
FEX and Petro-Canada, bidding as 60/40 partners, took some 562,000 acres in the Sept. 27 sale, 60 percent of the 939,867 acres which received bids, paying a total of $10.4 million, an average of almost $18.50 an acre.
FEX/Petro-Canada also had the high bid, at $201.03 an acre for tract 272, a total of $2,280,100 for that tract, which is adjacent to a tract for which FEX paid $5.09 an acre in BLM’s 2004 Northwest NPR-A lease sale.
FEX/Petro-Canada took all 48 tracts on which they bid.
The tracts were south and west of a large block on the northeastern edge of the sale area in which both companies took acreage in the 2004 sale. The new tract acreage extends as far west at Atqasuk. In the north the companies filled in north and east of 2004 tracts.
Richard Garrard, a FEX geoscientist based in Alaska, told Petroleum News after the sale that FEX has some 100 percent acreage in NW NPR-A and some that has been cross-assigned to Petro-Canada.
FEX is drilling as many as five wells in the winter of 2006-07 on some of the acreage it acquired in NW NPR-A in 2004, but as of Oct. 26, it was not clear if any of the potential drilling locations were on tracts that Petro-Canada had an interest in.
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