Alaska announced bids Dec. 13 on 48 oil and gas leases sold in competitive online lease offerings. The results, for lands on the North Slope and Cook Inlet, were modest but indicate continuing interest, which is positive, state officials said. Bids were solicited for unleased state-owned land in five regions of the state but only three areas attracted offers: The North Slope; the Alaska Beaufort Sea offshore the slope and in Cook Inlet. All three regions have seen exploration and are now producing. For the North Slope onshore, the apparent high bidders on leases are companies that are existing explorers: Brooks Range Petroleum, subsidiary of U.K.-based Pantheon Resources with high bids on 46 leases in the new sale; Langniappe Alaska, subsidiary of Colorado-based Armstrong Oil and Gas, won 17 leases; Oil Search, a subsidiary of Santo, Ltd. of Australia won 14 leases, and Alaska independent Finnex won three leases and Strong Resources, another independent won one lease. In the Alaskan Beaufort Sea offshore the North Slope, Langniappe Alaska won three leases; Savant Alaska, a Denver-base independent that developed the small Badami oil field east of Prudhoe Bay, won two leases. E&E Partners, an independent bidding group, won seven leases. The aggressive bidding by Brooks Range, for 46 tracts, indicates the company’s confidence in new discoveries being made in the central area of the slope where it is exploring. Similarly, bids on 17 tracts indicates its confidence. The company is planning six exploration wells on acreage it now holds, three wells this winter and three next year, In Cook Inlet, there were six tracts bid on, with three leases won by Hilcorp Alaska, a major independent that is the Inlet’s major oil and gas producer, and three by HEX LLC, an Alaska-based independent that owns and operates the small Kitchen Lights gas field. There were no offers for leases in two remote Alaska areas where bids were solicited, the Alaska Peninsula and the North Slope foothills area south of the Prudhoe Bay and other large producing fields on the slope. The combined sales brought in an estimated $8 million in “cash bonuses” for the State of Alaska, an increase over 2022. More than 224,000 acres on 110 tracts received bids across all of the lease sales. Gov. Mike Dunleavy said he was satisfied that existing explorers and producers in the state are confident enough to expand holdings. In Cook Inlet, it was also promising to see two Alaska-focused companies make offers, the governor said, “but the lack of large new bidders emphasizes the need for Alaska to take action to stimulate more natural gas production in the Inlet.” Natural gas production in the Inlet is declining, a major concern for Dunleavy because gas produced in the region fuels space heating and power generation in Southcentral Alaska, the state’s major population center. “I’ll be introducing a proposal in the upcoming legislative session to offer new incentives. We need to ensure we are doing everything we can to make our natural resources available for affordable, secure energy,” Dunleavy said. In the lease sale just concluded the state had offered a net-profits bid variable for Cook Inlet. “The net profit share enables a producer to recover costs more quickly and then share profits with the State once the development costs are recouped, the governor said, explaining the incentive. — Tim Bradner THE LINK: JANUARY 2024 24 MEET MANH CHOH ALASKA’S NEWEST GOLD MINE Mining is now underway at Manh Choh near Tok, where it will bring hundreds of jobs and millions in business opportunities to the region. Manh Choh is a joint venture with Contango ORE. Alaska nets $8M from Slope, Inlet lease sales
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