Gardes North Fork paper moves; Vision approved as unit operator

Kay Cashman

Petroleum News

Alaska’s Division of Oil and Gas approved two Gardes Holdings applications on May 18; one of which was also requested by the now former operator of the Cook Inlet basin North Fork unit, Cook Inlet Energy, or CIE.

In a certified letter addressed to CIE President Stephen Ratcliff, Division Director Tom Stokes approved the transfer of operatorship of the North Fork unit to Gardes Holding, which acquired the southern Kenai Peninsula unit in September 2020 from CIE, a Glacier Oil and Gas company. The 2,601.84 acre, five-lease unit produces from a single participating area covering 800 acres.

In the letter Stokes noted that on Dec. 15, the division received a complete lease assignment application from CIE to Gardes for the North Fork unit and “currently is adjudicating” the request and will address it in a separate decision.

The approval letter also said Gardes is qualified to hold a lease as provided in 11 AAC 82.200-82.205 and is qualified to fulfill the duties and obligations prescribed in the North Fork unit agreement.

The decision was retroactively effective to Jan. 1.

The second May 18 approval letter from Stokes was addressed to Vision Operating CEO Robert A. Gardes of Lafayette, Louisiana, although it should be noted that Vision is registered as an Alaska limited liability corporation that is owned by Bob Gardes.

That letter said on May 11, the division received written notification that Gardes Holdings was resigning as operator of the North Fork unit and that it and CIE - sole working interest owner in the North Fork unit leases - were designating Vision Operating as successor unit operator.

Again, Stokes wrote that Vision was qualified to hold a lease as provided in 11 AAC 82.200-82.205 and is qualified to fulfill the duties and obligations prescribed in the North Fork unit agreement.

Stokes made this change in operator effective May 1.

Mark Landt, who runs the operations crew on the ground in Alaska for Gardes/Vision, told Petroleum News that they also plan to request the division transfer the leases to Vision.

Landt said he has his attention focused on enhancing production from North Fork, which was originally brought online by a Bill Armstrong joint venture in 2011, even though the field was first unitized by Standard Oil Co. of California in 1965.

In a deal with utility Enstar Natural Gas Co., North Fork supplied southern Kenai Peninsula residents with their first natural gas in 2014 - prior to 2014, the area was not serviced by a gas pipeline. (Vision has an agreement with Enstar that became effective May 10 when the CIE/Enstar deal expired.)

“For the next year or more” Gardes operating subsidiary Vision Resources is “focused on North Fork,” Landt, whose title is vice president of land and upstream business development for Gardes, told Petroleum News on March 10 and reiterated May 17. “We see some definite opportunities to pursue there,” he said, noting the company has a “full G&G staff” working on North Fork.

“Now that we have our plan of development for the unit approved with the Division of Oil and Gas and have purchased 3D seismic … we are going to be working the 3D data and generating our own ideas going forward.”

Landt said Vision sees “additional gas to be recovered” at North Fork, mentioning the possibility of “additional sands” in the field and more workovers.

Gardes has already increased output from the field in the few months it has had control of it.

For example, in March the North Fork participating area averaged 3,045 thousand cubic feet per day, up 0.3%, 8 mcf per day, from a February average of 3,037 mcf per day; largely, Landt said, from adding compression.

- KAY CASHMAN