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BRPC drops Putu, most of Beechey Point Brooks Range Petroleum Corp., operator for AVCG, Ramshorn, voluntarily terminates Putu unit, drops 64,066 acres Kristen Nelson Petroleum News
Brooks Range Petroleum Corp., operator for the AVCG LLC and Ramshorn Exploration joint venture, said Sept. 4 that the JV partners have voluntarily released exploration acreage in the Putu and Beechey Point units on Alaska’s North Slope.
All of the 21,947 acres in the Putu unit have been released, BRPC said, along with 42,119 acres on the western side of the Beechey Point unit.
BRPC said it still holds just under 100,000 acres on the North Slope in the Southern Miluveach, Tofkat, Kachemach, Beechey Point and pending Telemark unit, plus non-unitized acreage still in its primary term.
Letters from the Department of Natural Resources, dated Aug. 31 and posted on the Division of Oil and Gas website Sept. 4, approved the voluntary termination of the Putu unit and the contraction of the Beechey Point unit.
DNR Commissioner Dan Sullivan said BRPC notified the division Aug. 30 that the working interest owners in the Putu unit had voted to terminate the unit agreement effective Aug. 1.
Sullivan said he approved the voluntary termination, effective Aug. 30. He said BRPC is relieved of an obligation under the Putu promissory note executed Jan. 24 to pay DNR an additional $9 million. DNR will collect the $1 million certificate of deposit posted as security under the Putu promissory note and the performance guaranty approved July 7, Sullivan said.
The Putu unit was on the western side of the North Slope, adjacent to the National Petroleum Reserve-Alaska and south of the BRPC-operated Tofkat unit.
Four wells required When DNR approved the Putu unit in late October 2011, BRPC was required to post a $10 million performance bond to guarantee performance of a four-well drilling commitment.
BRPC had proposed a 39-lease Putu unit covering some 39,993 acres, with three exploration blocks. The state broke those three areas into two units, the Tofkat unit to the north and the Putu unit to the southwest and southeast, with 21 leases in the Tofkat unit, some 9,131 acres, and nine leases in the Putu unit, some 21,946 acres. Four wells were required into the Upper Jurassic-age strata of the Kingak formation in the Putu unit by May 31, 2013, two targeting the Musketeer trend (Brookian Sequence Boundary C) and two targeting the Big Foot trend (Brookian Sequence Boundary BC).
In an Aug. 31 letter, Division of Oil and Gas Director Bill Barron approved a voluntary contraction of the Beechey Point unit, contracting the unit to seven leases with 10,757 acres. Barron approved the contraction effective Aug. 29, and required BRPC to submit a revised plan of exploration for the unit by Sept. 30.
Focus on Mustang “The release of this acreage indicates our focus on placing a priority on our near-term Mustang Development Area in the Southern Miluveach Unit with facility construction to begin in 2013, development drilling in 2014 and first oil anticipated in the first half of 2014,” BRPC Chief Operating Officer Bart Armfield said in the company’s statement.
“In addition to Mustang, priority in 2013-15 will remain on our other three potential development areas where we have known producible oil in the Tofkat, Beechey Point and Telemark Units,” Armfield said.
He said appraisal wells are needed before development in those three units is sanctioned.
“BRPC will still be one of the most active exploration companies on the Slope,” Armfield said. A rig is being secured and two or three penetrations are planned in 2013 in the Tofkat unit, he said.
Armfield also said two well locations in the Kachemach unit are “being assessed to see if they meet economic criteria for drilling in 2013,” with a final decision on those wells to be made later in the fall or early in the winter.
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