Alaska receives $10.9 million in bids for North Slope oil leases | S&P Global
Tim Bradner, S & P Global, December 11, 2024
HIGHLIGHTS
New interest in Harrison Bay offshore
North Slope Foothills sale area sees its first bid in a decade
Alaska’s Division of Oil and Gas published results Dec. 11 for three North Slope regional lease sale areas – the Beaufort Sea, North Slope, and North Slope Foothills. The combined sale earned an estimated $10.9 million in cash bonus for the State of Alaska, the highest amount since the Fall 2018 sales, the division said in an announcement.
The state of Alaska received bids for more than 184,000 acres from seven bidders across all lease sale areas, the division said.
Alaska holds three “areawide” lease sales on the North Slope yearly, in the fall, that covers all unleased state lands in the onshore central North Slope near existing large producing fields, as well as the Alaska Beaufort Sea submerged lands out to the state’s three-mile territorial limit, and the “foothills” area near the Brooks Range in the southern North Slope.
Most bids in the state’s annual sales come in the onshore central North Slope because there is extensive knowledge of the regional geology and because of the proximity of infrastructure and oil field services.
The Trans Alaska Pipeline System’s Pump Station One is in this area as well as the Deadhorse industrial support center, which is adjacent to the producing Prudhoe Bay oil field.
The Beaufort Sea areawide sale, which is in a higher-cost offshore area where there are environmental challenges, saw competitive bidding in Harrison Bay between EE Partners Corporation, which holds existing leases in the area, and Juneau Oil & Gas LLC, a new entrant into Alaska. Harrison Bay is a shallow-water area on state submerged lands just north of the producing Alpine oil field, which is onshore.
Savant Alaska LLC and Lagniappe Alaska LLC, two companies that already have a significant stake on the North Slope, won additional leases, the oil and gas division said. Lagniappe Alaska is a subsidiary of Denver-based Armstrong Oil and Gas, an experienced North Slope explorer now working in the eastern North Slope onshore. Savant owns the small producing Badami oil field near the Beaufort Sea coast east of Prudhoe Bay.
Another Alaska company, Captivate Energy Alaska Inc, expanded its acreage and a new entrant, Surprise Valley Resources LLC won a significant block of new leases.
The North Slope Foothills sale area also saw its first bid in a decade, on state lands in the western end of the area beyond Umiat, a base camp in the far southeast boundary of the federal National Petroleum Reserve-Alaska.
A small oil discovery was made at Umiat in the 1950s in exploration led by the U.S., which administered the reserve prior to the U.S. Bureau of Land Management assuming management in 1976.
In a statement, Alaska’s natural resources commissioner John Boyle said: “It is extremely promising to see new bidders and competition in this latest lease sale, especially as so many highly prospective areas are already under lease and being actively explored.”
“We need to do everything in our power to support these newly leased areas becoming exploration prospects, future discoveries, and potential development opportunities that will support Alaskans for generations to come,” Boyle said.