Companies bid $53.9 million for leases in northwest
National Petroleum Reserve-Alaska
ANCHORAGE-Five oil companies submitted bonus bids totaling $53,904,491 to win rights to develop 123 oil and gas lease tracts on 1,403,561 acres in the northwest corner of the National Petroleum Reserve-Alaska at today’s lease sale. In terms of acres leased in one sale, it was the largest on-shore federal lease sale in Alaska.
Bids were received from Anadarko Petroleum Corp., Conoco-Phillips Alaska, Inc., Pioneer Natural Resources Alaska, Inc., Petro Canada Alaska, Inc., and Fortuna Exploration LLC. The single largest bid of $13,745,000 was offered by Fortuna Exploration LLC for tract D-19 near the Ikpikpuk River. A map and table with complete sale results by tract will be posted on the internet at www.ak.blm.gov as they become available.
“The energy resources of the National Petroleum Reserve–Alaska are essential to meeting our nation’s energy demands and are a major part of the president’s National Energy Plan. This is a long-term strategy to keep the oil flowing in the Trans-Alaska Pipeline, reduce our dollar exports, and decrease America’s dependency on foreign oil sources,” said BLM-Alaska State Director Henri Bisson.
“This area is far from the infrastructure developing along the eastern border of the reserve. We are gratified to see industry’s vote of confidence and willingness to invest in the future. We are also pleased to recognize the new bidders as well as all the companies with a proven track of Arctic exploration and development,” said Bisson.
The bonus bids, along with annual rental payments, are split 50/50 between the federal government and the State of Alaska to aid the impacted communities. BLM estimates that annual rental payments could generate more than $4 million dollars per year.
BLM traditionally takes approximately 90 days to evaluate the bids before officially awarding them. As a result of an order issued in federal district court last Friday, Bisson said BLM cannot permit any surface occupancy, including seismic activities, on any leases issued until the litigation is resolved and the court rules on the merits of the case.
This is the first time industry has bid on tracts in the northwest part of the National Petroleum Reserve-Alaska since the previous sales held 1982-84. In 2002, the US Geological Survey estimated that the reserve, as a whole, could contain as much as 5.6 billion barrels of economically-recoverable oil, based on a selling price of $30/barrel. Most of this is thought to be associated with geologic structures closest to the coast.
The lease sale followed a two-year planning process. “This plan will help us implement Congressional direction to maximize the production of the oil and gas resources in an environmentally-safe manner while protecting important biological, subsistence and cultural values also found in this area,” said Bisson.
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