Hilcorp lone bidder once again at Cook Inlet lease sale
For the fourth year running Hilcorp was the only player in the state’s annual Cook Inlet oil and gas lease sale.
The Division of Oil and Gas received three bids from the Houston-based producer, netting the state nearly $179,000 for 7,146 acres. Hilcorp’s bids averaged $26.76 per acre.
Hilcorp is the primary operator in the basin and has been the only company to bid in the state’s spring Cook Inlet leases sale since no bids were submitted in 2016. The company acquired 17 tracts from 2017-19.
The Alaska Peninsula lease sale garnered no bids as usual.
Division of Oil and gas officials released the bid results June 17.
Hilcorp won the rights to one tract adjacent to the oil-bearing Cosmopolitan Unit, which also contains gas, on the southern Kenai Peninsula. The two other tracts are on the west side of Cook Inlet on the Iniskin Peninsula.
Oil production from the Inlet has averaged roughly 15,000 barrels per day in recent years, but the basin is most known for being the lone supply of natural gas for Anchorage and the rest of Southcentral Alaska.
Division of Oil and Gas Director Tom Stokes noted the auction was also the state’s first online-only lease sale.
“We have been working hard to update the way the division does business, including providing scientific data, making lease offerings available globally, and conducting auctions online. (This) experience, including sale results, validates our investment in this new way of doing business,” Stokes said. “It bodes well for our ability to conduct larger, more complex sales in the future that operate efficiently at lower state cost.”
Division officials contracted with EnergyNet Services LLC, a Texas-based firm that specializes in commodities and oil and gas property auctions for the sale. The business relationship should enhance the state’s ability to offer prospective oil and gas acreage to broader markets worldwide, according to a division statement.