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BLM renews Umiat area lease for Linc Upcoming drilling program convinces federal agency to extend lease term for an additional 10 years; fees and rents still apply Eric Lidji For Petroleum News
The U.S. Bureau of Land Management is extending the term of a National Petroleum Reserve-Alaska lease, part of the Umiat prospect slated for exploration this winter.
Operator Linc Energy (Alaska) Inc. plans to conduct a major exploration campaign on and around the lease this coming winter, drilling as many as five wells at the prospect.
The program helped convince BLM to extend the term of the lease by 10 years.
Our agency is optimistic that the lease renewal sought by Renaissance Umiat, LLC is a positive step toward active production in the NPR-A, BLM-Alaska State Director Bud Cribley said in a statement. Although Linc acquired Renaissance Umiat in 2011, the Umiat leases remain in the name of that local subsidiary of a small Houston independent.
Linc plans to drill three vertical wells, a deep horizontal well test and a disposal well.
The companies paid the BLM $1,150,000 to renew the 11,500-acre lease and will be on the hook for an additional $34,500 annual rental rate, according to the BLM. The State of Alaska gets half of all revenues generated from NPR-A leasing, according to BLM.
BLM originally sold the lease AA-084141 to independent investors Paul L. Craig and Peter S. Zamarello in a June 2002 lease sale. A Renaissance affiliate and fellow Texas independent Rutter and Wilbanks Corp. acquired the lease from those partners in 2006, as part of its effort to consolidate the leases in the Umiat prospect.
The lease was set to expire at the end of October, but is now valid until Oct. 30, 2022.
The Umiat field covers two federal and two state leases. Because of a 3-D seismic shoot Renaissance undertook in 2008, BLM extended its other lease AA-081726 until 2019. The state leases dont expire until Jan. 31, 2014, and Jan. 31, 2016, respectively.
Previously, when Renaissance planned to operate an exploration program at Umiat, it staked 10 wells on the two federal leases: three on AA-084141 and seven on AA-081726.
Linc recently staked three potential locations on AA-081726 the Umiat No. 1 class II disposal well, and the Umiat No. 18 and No. 19 vertical wells and four potential locations on AA-084141 the Umiat No. 16 and No. 23 vertical wells and the Umiat No. 16 H and No. 23H horizontal wells.
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