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State sets bid opening date for Beaufort, North Slope fall sales
The state will hold its public bid opening for its fall lease sales at 9 a.m. Dec. 6 at the Dena’ina Center.
The Alaska Department of Natural Resources, Division of Oil and Gas, said in an Oct. 6 notice that bid submission closes at 4 p.m. Dec. 4 for the areawide Beaufort Sea, North Slope and North Slope Foothills 2017 competitive oil and gas lease sales.
Details on the sales are available on the division website: http://dog.dnr.alaska.gov/Services/LeaseSale.
For Beaufort Sea and North Slope sales the minimum bid is $25 an acre. All of the Beaufort tracts have a 16.6667 percent royalty. The North Slope tracts jointly owned by the state and the Arctic Slope Regional Corp. and state-owned tracts in the north sub-region have fixed royalties of 16.6667 percent; tracts in the south sub-region have a fixed royalty of 12.5 percent.
Beaufort and North Slope tracts jointly owned by the state and ASRC have primary lease terms of 10 years and annual rentals of $10 per acre for years one through seven and $250 per acre for years eight through 10. The division said that for those tracts where the rental rate increases in year eight, rent would remain at $10 per acre beginning in the year in which sustained production begins on the lease or if “the state otherwise determines in its sole discretion, upon request, that the lessee has exercised reasonable diligence in exploring and developing the lease.” The division said that in evaluating requests for decreased rental “based on the exercise of reasonable diligence, the state will consider the funds expended by the lessee to explore and develop the lease and the types of work completed by or on behalf of the lessee on this lease.”
Beaufort and North Slope tracts which have a consistent $10 per acre per year rental rate have eight year terms.
The minimum bid for all North Slope Foothills tracts is $10 per acre; royalty is 12.5 percent; term is 10 years; and rent is $1 per acre in year one, $1.50 per acre in year two; $2 per acre in year three; $2.50 per acre in year four; and $3 per acre in year five and beyond. All Foothills tracts have 10-year terms.
NPR-A sale In recent years the federal Bureau of Land Management has opened bids for its National Petroleum Reserve-Alaska lease sale the afternoon of the state sale. Those openings were previously held at the agency’s Anchorage office, but last year the bid opening was online in lieu of the public bid opening at the Anchorage office.
BLM had not yet published a date for the 2017 sale when this issue of Petroleum News went to print. The agency issued a call for nominations and comments for the sale in August. The nominations and call closed Sept. 6.
- KRISTEN NELSON
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