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THE INDEPENDENTS 2003: Andex mum on its plans for Nenana Denver-based company wants partner for Interior Alaska basin gas exploration Kay Cashman Petroleum News
Since Executive Vice President Jim Dodson left Andex Resources last spring the company has remained mum on its plans for exploring its half million acres in Alaska’s Nenana basin.
Dodson, executive vice president of Houston-based Andex, left the company to take a position with Clearflame Resources in Denver. (See story on Clearflame on page 82.)
Based in Denver, Dodson had been in charge of Andex’s Alaska properties, including its Nenana gas exploration program, scheduled to get under way in the winter of 2003-2004 with a seismic shoot.
Bob Mason, who worked with Dodson at Andex in the Denver office, told Petroleum News in late May that Andex was still looking for partners to help fund its Nenana project. He said the exploration tax credit program passed in May by the Alaska Legislature could be an asset in the company’s search for a partner, or partners.
“Industry is very adverse right now to frontier exploration (investments). Obviously, that’s a bill that is critically important to what we’re doing,” Mason said.
“We have a 2-D seismic program planned for next winter at Nenana,” but additional capital from a partner might allow Andex to shoot 3-D seismic next winter.
Andex, which has several prospects in the Gulf of Mexico, South Louisiana, South Texas and Wyoming, has always said it was focusing its hunt for gas in Alaska on its 530,000 acres in the Nenana sedimentary basin in the Interior part of the state where the company expects to find enough natural gas to meet the energy needs of Fairbanks and other rail belt locations.
However, calls by Petroleum News to company President Tom Dodds at Andex’s headquarters in Houston and emails to Mason at the Denver office have produced no response since Mason was interviewed on May 27.
‘Huge potential’ for coalbed methane Before leaving Andex, Dodson said, “Right now the biggest thing we’re working on is . . . we’re talking to several potential partners to come into the project with us to help share some of the risk and capital and of course to put more than one head together to the problems that are going to be faced out here. And to help us with the exploration effort.”
In an executive summary Andex was handing out to potential partners last year it said it was looking for one to three partners. Its acreage, which it said was in the “deepest portion of the Tertiary sedimentary” Nenana basin, was highly prospective for gas and probably oil, plus has “huge potential” for coalbed methane gas development.
One to 10 trillion cubic feet of gas The summary said the company estimated the basin contained recoverable reserves of gas ranging from 1 to 10 trillion cubic feet, “with a risk-adjusted most likely estimate of 3 tcf.”
Dodson said that Andex planned to acquire 2D seismic in late 2003 and take “the summer after that to interpret our data … and begin drilling in the winter of 2004-2005. Assuming we have success out there we would like to begin the developmental phase in 2005-2006, and be selling gas into Fairbanks in the fourth quarter of 2006.”
In the past, Andex has said it expected to spend $25 million on the Nenana project before the pipeline was built.
In the executive summary it said the purchase of existing 2D seismic would cost the company “approximately $500,000” and shooting 200 miles of new 2D would run in the neighborhood of $4.2 million. The drilling of two test wells would cost approximately $6.5 million each, using an illustration of a 12,000 foot completed well as an example.
Andex said it might also look at acquiring 300 miles of 3-D seismic at a cost of $10 million.
Deal with BP brought Andex to Alaska Andex first came to Alaska to participate in BP Exploration (Alaska)’s West Gwydyr exploration project on the North Slope. That well, the West Gwydyr No.1, was drilled, then plugged and abandoned in the winter of 2000, but Andex stayed in the state.
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