|
Holitna Energy still working on remote Alaska shallow gas project
Patricia Liles Petroleum News contributing writer
Phil St. George still believes in the gas potential for Holitna basin, despite a series of setbacks since filing in May 2003 for four shallow gas leases in the remote region of southwestern Alaska.
His company, Holitna Energy, and its Native corporation partner, TKC, plan to convert their shallow gas lease applications covering more than 19,000 acres of land to exploration licenses under the state’s conventional gas leasing program. That’s because Alaska’s non-competitive, shallow gas leasing program, also referred to as its coalbed methane program, has been legislated out of existence.
House Bill 531, passed May 11, abolished the shallow gas leasing program, leaving a number of pending applications. In addition to Holitna Energy’s four leases about 50 miles from the Donlin Creek gold mine project, Usibelli Coal Mine at Healy has an application pending for eight shallow gas leases.
And 13 applications are also pending in the Mat-Su Valley, according to Jim Hansen at the Alaska Division of Oil and Gas. Those applicants can convert their lease selections into a non-competitive exploration license application, Hansen said. Before approving an exploration license, the state must issue a best interest finding, which typically takes about a year to complete, he said.
Companies could do some preliminary fieldwork prior to receiving an exploration license, Hansen said. “Any work they do on exploration would count toward their work commitment,” he said. “But they are at risk whether the license will be awarded or not.” Still positive about Holitna Basin St. George remains positive about his company’s chances of finding gas to supply power and heat for Donlin Creek.
“We’ve got new information that there’s a good possibility of finding conventional gas, so we think there’s a better chance,” he said, on May 25. “We’ve got some more data on the basin and I don’t want to say any more about that.”
Holitna Energy and TKC plan to conduct some exploratory work this winter, pending successful fund-raising for seismic work and initial drilling. (On Jan. 3, Holitna said it plans to drill two exploratory wells this past winter for shallow gas and coalbed methane occurrences had been cancelled because funding had fallen through at the last minute.)
St. George said state officials told him they would “try to speed up” the best interest finding process, possibly completing it in six months.
Donlin Creek may not be the only potential large mine customer for Holitna Basin gas. St. George said he was approached by state development employees interested in taking Holitna basin gas about 100 miles south to Illiamna Lake, where the Pebble gold-copper-molybdenum project is generating considerable interest.
| 