NPR-A lease sale nets $63.8 million in bids

PHOTO/Ed Bennett/For the Journal
Eager to follow up on earlier forays into the National Petroleum Reserve-Alaska, a half-dozen oil and gas companies and investors rushed to snap up 60 tracts offered in a lease sale June 3 by the U.S. Bureau of Land Management, offering $63.8 million in apparent high bids.

BLM offered 292 tracts in the sale with a total of 3.03 million acres.

"This is the second sale we’ve held in the northeast portion of the NPR-A and the first sale under the president’s energy plan," said outgoing BLM state director Fran Cherry, who read the sale bids and announced preliminary results June 3 in Anchorage.

BLM held the first lease sale in the northeast quarter of the NPR-A in 1999 and attracted high bids totaling $104 million.

Four companies and two investors offered a total of 69 bids for 60 tracts covering 579,269 acres in areas designated by federal geologists as having both high and low potential for oil and gas deposits.

TotalFinaElf E&P USA Inc., bidding alone, offered the top apparent high bid of the sale, nearly $10.189 million for an 11,476-acre parcel south and west of the previously leased area. In all, TotalFinaElf was apparent high bidder for 19 tracts, with offers totaling $52.9 million.

Phillips and Anadarko, bidding together in partnerships with two different percentage splits, were the most active bidders in the sale. The companies racked up apparent high bids on 34 tracts totaling $9.6 million.

Phillips Petroleum Co., Anadarko Petroleum Corp. and BP Exploration (Alaska) Inc. drilled exploration wells in 2001 and 2002 on prospects picked up in the 1999 sale. Last spring, Phillips announced significant "Alpine-like" finds of oil and gas deposits on five sites it explored during the winter of 2001.

In a recently-released report, the U.S. Geological Survey substantially increased its estimate of both technically and economically recoverable oil and gas reserves in NPR-A.

The federal government will split the proceeds of the lease sale with the state of Alaska on a 50/50 basis.

06/09/2002 - 8:00pm