ANCHORAGE Nov 7 Big energy companies and
independent explorers and investors spent a combined $15.1
million on Wednesday on exploration rights to federal and state
territory across Alaska's North Slope, data from government
The sales follow plans announced last month by the
administration of President Barack Obama to offer up 4.5 million
acres of Arctic land for oil and gas production, as its energy
policies faced pre-election scrutiny. The action was coordinated
with Alaska's annual sale of state land leases.
Much of the bidding in the four coordinated lease sales was
concentrated on state lands and waters adjacent to the federally
managed National Petroleum Reserve-Alaska on the western North
The interest in the area shows that companies believe there
is an oil play between the Kuparuk field and the petroleum
reserve, said Bill Barron, director of the Alaska Division of
Oil and Gas, which held three of Wednesday's four lease sales.
"Looks like a western development area has, apparently, some
promise," Barron told reporters after the lease sales.
The state lease sales were for onshore North Slope acreage,
offshore Beaufort Sea territory and acreage in the Brooks Range
foothills, well south of established oil fields. The U.S. Bureau
of Land Management held the sale for the petroleum reserve, the
second in a series of what the Obama administration has said
will be a program of annual lease sales.
Barron said bidding for the state leases was better than he
expected. But bidding for petroleum reserve land was light, just
14 of about 400 tracts offered received bids.
The 23-million-acre petroleum reserve, which has never had
any commercial oil production, is considered a frontier area,
distant from existing fields and lacking oil infrastructure.
The most active bidders in the four sales included Repsol SA
of Spain; NordAq Energy Inc, an Anchorage-based
independent; Great Bear Petroleum, an Anchorage independent that
plans to explore shale-oil prospects; 70 & 148 LLC, a unit of
Denver-based Armstrong Oil and Gas; and AVCG, a joint venture
operated by Anchorage-based Brooks Range Petroleum.
Major Alaska producers also won rights to conduct new
exploration. ConocoPhillips won tracts on its own,
mostly on state land near the petroleum reserve border, and in
partnership with BP, Chevron and Exxon Mobil
Barron said bids from those companies were significant.
"I was really excited when I opened up the bids and saw some
of the primary players that had been there historically actually
now stepping back in on new acreage," he told reporters after
the three state sales.
Anadarko Petroleum picked up eight leases in the
gas-prone North Slope foothills. Anadarko's bids were for sites
the company had previously leased, Barron said.
NordAq bid strategically for leases in the petroleum reserve
that could be located along a corridor used for a pipeline that
would carry crude oil from yet-to-be developed offshore fields
in the Chukchi Sea, Bob Warthen, the company's president, said.
NordAq also acquired leases in the western Beaufort Sea that
were likely to be drilled from an ice island, Warthen said.
The company has been drilling exploratory oil and gas wells
in southern Alaska's Cook Inlet region, but has not yet drilled
on the North Slope, he said. The earliest that any North Slope
drilling could occur would be 2014, he said.
The petroleum reserve was established in 1923 as a source of
petroleum for the U.S. military.
A total of 11.8 million acres proposed to be made available
for leasing there hold an estimated 549 million barrels of
economically recoverable oil and 8.7 trillion cubic feet of
economically recoverable natural gas, the Department of Interior