THE EXPLORERS 2004: Devon in scoping mode, ups Cosmo stake

Kay Cashman

Petroleum News

Starting in the fourth quarter of 2003 and continuing to the press date for The Explorers in October 2004, Houston-based independent Devon Energy has been sending representatives to Alaska from its Canadian subsidiary, Calgary-based Devon Canada. These scouting expeditions were confirmed in a July 8, 2004, interview with Michel Scott, Devon Canada’s vice president, frontiers, who said Devon was in “scoping mode” in Alaska.

“There appears to be some synergy” between Alaska’s North Slope and Devon’s interest in the Mackenzie Delta, he said.

A northern front-runner in Canada’s Mackenzie Delta, Devon Canada already has a 10 percent interest in two leases in the eastern North Slope’s Point Thomson unit — the product of a merger, not a decision to get involved in Alaska. The adjoining leases are in the western quarter of the unit.

On July 8, Scott said no decisions to expand Devon’s presence in Alaska had been made to date, but “if something makes sense, it could be an area we could get more active in.”

Shortly after this interview, parent Devon Energy announced it had increased its working interest in the ConocoPhillips-operated Starichkof unit. That unit contains the Cosmopolitan prospect in southern Alaska’s Cook Inlet basin.

Devon Energy picked up half of the working interest of Forest Oil in the exploration unit in Cook Inlet’s lower Kenai Peninsula.

Devon Energy had held a 5 percent interest in the seven state leases in the unit — the result of a merger. Effective Aug. 1, Devon Energy acquired half of Forest’s 25 percent working interest. Unit operator ConocoPhillips retained a 70 percent working interest. Devon now has a 17.5 percent and Forest 12.5 percent.

The discovery well, Starichkof State No. 1, was drilled by Pennzoil Co. in 1967, northeast of the targets in the current drilling program, the Hansen No. 1 and a sidetrack, the Hansen No. 1-A, drilled in 2001-02 and 2003 from an onshore pad.

The Hansen 1 was plugged and abandoned with a measured depth of 18,630 feet and a true vertical depth of 7,418. The Hansen 1A sidetrack was completed as an oil well June 13, 2003, with a measured depth of 20,789 feet and a true vertical depth of 7,102 feet.

ConocoPhillips has been shopping for a partner in its 70 percent interest in Cosmopolitan, offering to trade working interest ownership for future 3-D seismic and a delineation well. No partnership deal had been announced as of Oct. 15, 2004.