Feb. 14, 1994

Possible investors review Midrex Plan for iron plant

By Margaret Bauman

[an error occurred while processing this directive] Alaska Journal of Commerce

Backers of the proposed iron ore reduction plant at Point MacKenzie said Asian meetings with potential buyers/investors went well and they hope for a formal statement of interest within three months.

If everything goes well, they could be breaking ground early next year for the $180 million plant, (considered a potential anchor tenant for proposed Port MacKenzie), said Gregory Branning, a market developer for Midrex Direct Reduction Corp. of Charlotte, N.C.

The plan would produce hot briquetted iron for export to steelmakers in northern Pacific Rim countries.

Branning was one of three Midrex officials who accompanied Alaska Commerce Commissioner Paul Fuhs, Matanuska-Susitna Borough Mayor Ernie Brannon, borough Port Director Steve Minor and Riley Snell, executive director of the Alaska Industrial Development and Export Authority, for meetings in Tokyo, Taiwan and Korea.

During a meeting in Tokyo, officials of Kobe Steel, the parent company of Midrex, agreed to review the information presented to validate project economics.

"Kobe is a very big company and they want to look closer into the project," Branning said. "Having the Alaskan delegation there gave the project a lot of validation. They gave Kobe a real unified effort about the project and that's what they were looking for.

"It was enough for Kobe to say they would take a serious look at it," he said. "We are very excited. We have hopes of breaking ground next year."

Feb. 14, 1994

Union Texas, CIRI pen exploration deal

By Kristen Nelson

For the Journal of Commerce

Union Texas Petroleum Alaska Corp. of Houston has signed an agreement with Cook Inlet Region Inc. to explore for oil and gas on CIRI lands on Alaska's Kenai Peninsula.

Union Texas has been an interest holder in Alaska projects run by others, but this is the first solo project the company has undertaken in the state, said Union Texas spokesperson Carol Cox.

The project will be a phased three-year exploration program on 340,000 acres some 50 miles southwest of Anchorage. The company has no plans to open an office in Alaska, but will manage the Kenai Peninsula project out of Houston, Cox said.

Union Texas will have total working interest and an option to acquire oil and gas leases. CIRI has the option to participate in the exploratory drilling and development program.

Union Texas will review 1,100 miles of existing two-dimensional seismic lines, and may opt to shoot more seismic as early as this year. An exploratory well could be drilled as early as the 1995-96 season.

Arco Alaska Inc. drilled three wells on CIRI leases in the 1980s: Two some 15 miles northeast of Kenai and the third some 14 miles southeast of Kenai. No production resulted.

CIRI Production Co. operates the West Fork gas field on the peninsula. That field was discovered in 1960. CIRI drilled the producing wells on the property in 1991 and 1992. CIRI also owns state of Alaska oil and gas leases, both in the Cook Inlet basin and on the North Slope.

- Compiled by Ed Bennett