|
Cook Inlet sale a burner Alaska lease sales bring in $2.9 million, $2.7 million from sale of 72 tracts in Cook Inlet Basin and five tracts in Brooks Range Foothills Kristen Nelson Petroleum News Editor-in-Chief
The state of Alaska took in $2,876,720.16 at two areawide lease sales May 19: $154,656 for five tracts in the North Slope Foothills lease sale and $2,722,084.16 for 72 tracts in the Cook Inlet lease sale.
It is the most successful Cook Inlet lease sale in 15 years, Alaska Department of Natural Resources Deputy Commissioner Marty Rutherford said before the bids were opened. This sale, Rutherford said, “marks the seventh year” of the Alaska areawide oil and gas leasing program, which began in 1998. The state has leased nearly 3.7 million areas in 18 areawide lease sales, “and after today, we anticipate exceeding $100 million in bonus bids” from the areawide sale program, she said.
She also welcomed Pioneer Oil Co. of Lawrenceville, Ill., to Alaska — the company took 27 of the 28 Cook Inlet tracts on which it bid — and noted that “independents play a very vital role in exploration in Alaska, all the way from the Beaufort Sea to the Cook Inlet, and you’ve been growing in numbers, which we’re very pleased about.” (See related story on Pioneer on page 4.) Petro-Canada only Foothills bidder In the Foothills areawide lease sale, Petro-Canada (Alaska) Inc. was the only bidder, taking five tracts at $5.37 an acre, for a total of $154,656. Petro-Canada is already a major leaseholder in the North Slope Foothills, and the tracts it took in this sale area adjacent to leases the company already holds.
Mark Myers, Department of Natural Resources Division of Oil and Gas director, said the Foothills bids covered approximately 28,800 acres. 78 bids in Cook Inlet sale Myers said the state received 78 bids for 72 tracts in the Cook Inlet sale, approximately 363,520 acres. “This is the most interest we’ve received in a Cook Inlet sale since Sale 49 which was held in 1986,” he said.
Major bidders in the Cook Inlet sale included newcomer Pioneer Oil with a total high bonus bid of $793,152 (27 tracts), followed by Alliance Energy Group at $486,128 (three tracts), Marathon Oil at $424,012.80 (11 tracts), Unocal at $386,585.60 (seven tracts), Forest Oil at $232,172.80 (nine tracts), Escopeta Oil & Gas at $162,956.80 (seven tracts) and Aurora Gas at $98,183.20 (three tracts).
Eighteen of the tracts Pioneer took are west of Knik Arm, across from Anchorage, from north of Point MacKenzie to southwest of Wasilla. The other block of tracks Pioneer took is on the west side of Cook Inlet, inland from Trading Bay and west of Aurora’s Nikolai Creek gas field.
Bill Van Dyke, Division of Oil and Gas petroleum manager, said there were old wells in the area west of Knik Arm, drilled looking for oil. “I’d say it’s probably more a gas-prone area,” he said, based on the regional geology. Van Dyke said the other Pioneer Oil block, north of Trading Bay, is probably also a gas area, based on what companies like Pelican Hill and Aurora are doing in the area.
Other companies, he said, appeared to be bidding in areas where they have interests. “Marathon’s been real active up in the Kenai-Sterling area, and that’s where they bid, and Unocal, of course, has been real active on the southern peninsula, where they bid.”
Myers said afterwards that it was a very good sale for the state, and that he was pleased to see a new player, Pioneer Oil, and was also pleased to see “the Unocal and Alliance folks filling in down by Anchor Point area” along the Ninilchik, Deep Creek trends.
Companies seemed to be filling in areas where they have interests, he said, including Aurora Gas and Forest on the west side and Escopeta with its offshore interests. “I think the pattern’s very logical,” he said. Stiffest competition in Lower Cook Inlet The highest per-acre bids in the sale were for five tracts on the lower Kenai Peninsula, in the area where both Unocal and Alliance Energy are developing natural gas fields. Nine tracts in this area received 13 bids, and of 10 bids in the sale for more than $10 an acre, six were in this area, including one losing bid.
Alliance paid the highest per-acre amount in the sale, $40.25 (with an estimated total bonus bid of $231,840) for tract 812, south of acreage the company holds surrounding its North Fork gas field east of Anchor Point, outbidding Monte J. Allen for the tract. Alliance also had the second highest per-acre bid, $36.50, for tract 799, on which it outbid Unocal. Tract 799 is just north of the company’s North Fork acreage, and just west of Unocal’s Nikolaevsk unit. Alliance also took tract 797, east of its North Fork acreage.
Unocal had the third highest per-acre bid of the sale, $21.15, for tract 781 southwest of its Deep Creek unit, and paid $16.37 per acre for tract 800, just south of tract 781. Unocal took the most tracts in the area, five; Alliance took three; Aurora Gas took one.
Andy Clifford of Aurora Gas said Aurora is reforming an acreage position on the lower Kenai Peninsula that is part of what the company acquired from Anadarko Petroleum. Aurora picked up one of the lower peninsula tracts it bid on, losing the other to Unocal. Aurora also took two tracts on the west side of Cook Inlet, where it is a gas producer.
Clifford said Aurora is “chasing oil, not gas,” on the lower Kenai. On the west side the company picked up a lease at the mouth of the Susitna River, a frontier area for the company, Clifford said, with only a little bit of well control and vintage seismic. MMS receives no bids for Cook Inlet lease sale The Minerals Management Service was to have held its Cook Inlet Sale 191 in conjunction with the state sales, but the agency said May 18 that it received no bids for the sale.
“Part of our job is to provide access to acreage, but companies then must decide whether it fits in with their exploration plans,” MMS Alaska Regional Director John Goll said in a statement. Goll said “companies continued to express interest right up through the last few weeks,” but no bids were received prior to the agency’s May 18 deadline.
Goll said prior to the state sale that he hopes MMS can continue to hold sales in conjunction with the state.
“Regardless of what happened today, I want to reemphasize, though, that the Department of the Interior remains committed to offering acreage for exploration access into the future,” he said.
MMS has proposed another sale for Cook Inlet in 2006. The last exploration well was drilled in the federal Cook Inlet outer continental shelf area in 1984, and the area remains relatively unexplored.
|
