THE INDEPENDENTS 2003: ASRC firm gets ANWR well contract

Kay Cashman

Petroleum News

The Alaska Division of Oil and Gas has selected ASRC Energy Services as its first choice to assist it in drawing up preliminary plans for an ANWR stratigraphic test well. Anchorage-based ASRC Energy Services was one of two companies that responded to a Sept. 26 RFP from the state of Alaska for planning the well and putting a consortium together to drill it.

“We have recommended our contracting office enter into negotiations with ASRC Energy Services to negotiate a contract,” division geologist Jim Cowan told Petroleum News Oct. 24.

If a satisfactory agreement is reached, the Arctic Slope Regional Corp. subsidiary will help the division and interested industry participants put together a plan for the ANWR test well, including a cost estimate. ASRC Energy Services will also solicit technical input and commitments from individuals or organizations willing to participate in a consortium to drill the well in the winter of 2004-2005 in the eastern Beaufort Sea offshore the Arctic National Wildlife Refuge’s 1002 area.

The state said the planning project is expected to cost $50,000.

According to the RFP, the division is looking at well locations on unleased state submerged lands approximately 30 miles southeast of Kaktovik, Alaska, “between the state’s three-mile limit and the coastal boundary of the Arctic National Wildlife Refuge. The area of interest is offshore of the Angun oil seep near Angun Point.”

A test well drilled in the eastern Beaufort offshore ANWR could provide valuable information about the geologic potential of both the coastal plain and eastern Beaufort waters — neither of which is currently offered by the state or feds for oil and gas leasing, Alaska Division of Oil and Gas Director Mark Myers told Petroleum News Aug. 12.

“This is an area that has been under-evaluated and this … (test) well could provide the data, the catalyst for more frontier exploration,” he said.

The state is, “at present, entitled to 90 percent of the royalties that might result from any production from within the ANWR and to 27 percent of royalties paid to the federal government for production from the outer continental shelf offshore Alaska,” the RFP said.

The RFP asked for work to be completed by Jan. 5, but Cowan said that date will likely be renegotiated for a later date “sometime in the first quarter of next year.”

The well would be subject to normal permitting requirements and would likely be eligible for the state’s 40 percent exploration tax credit, division director Mark Myers said in August.