Anchorage, Alaska — Alaska will conduct a special North Slope lease sale in November offering groups of leases packaged in three blocks, with the state also making large amounts of 3-D seismic data available to bidders, a state official said Tuesday.
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Bidders will be required to make a single offer on the entire package of leases, Mark Wiggins, state Deputy Commissioner of Natural Resources, said in an interview.
The special sale will be held at the same time that Alaska holds its regular fall North Slope "area-wide" sale, but will be conducted separately, Wiggins said.
The fall area-wide sale is scheduled to be held November 15. It will be a busy day for prospective explorers because Alaska typically holds its fall area-wide sale on the same day the US Bureau of Land Management holds its annual lease sale for the National Petroleum Reserve-Alaska, a large federal reserve west of state-owned lands on the North Slope.
Alaska owns the seismic data that is being offered to prospective bidders in the Special Alaska Lease Sale Areas, or SALSA blocks, Wiggins said. The state acquired the data from companies who conducted the seismic work and applied for state tax credits to help fund said efforts.
Under the terms of the tax credits, the companies agreed to release the data, which was proprietary, after 10 years, Wiggins said. The 10-year clock has now run down on the seismic "shot" in the three special areas, and so is now available to others.
The three special areas include Harrison Bay on the west-central slope, the largest grouping of leases with 66,430 acres adjacent to the Colville River delta and the NPR-A; Gwydyr Bay, a 23,040-acre group of offshore leases just north of Prudhoe Bay; and Storms, a 30,720-acre block on onshore leases south of Prudhoe Bay.
The areas have been leased before with wells drilled on or near the acreage, Wiggins said. Information from most of the wells is also available, and some of them had oil showings.
Basically, the state is betting that the data being made available will whet appetites, encouraging companies to take a fresh look at areas previously explored, and use of newer technologies.
That is an ongoing trend on the North Slope where companies like ConocoPhillips are finding new deposits of hundreds of millions of barrels bypassed previously. They are applying 3-D seismic techniques and geologic interpretations in areas long passed over, and then planning development of discoveries with technologies like horizontal drilling.
Wiggins said the terms for bidding for the special blocks will be similar to those being asked for in the regular area-wide sale, with lease terms of eight years, royalty rates of 16.66% and a minimum bid of $25 per acre.
However, there are also special work commitments attached to the special lease areas including the drilling of wells, he said.
"We getting a lot of interest in the SALSA blocks based on the 'hits' on our website," where data is cataloged, Wiggins said. How that will translate to bidding in the November sale is unknown.
Alaska holds two sets of area-wide sales in the late fall and spring. The fall sales include all unleased state lands in the central North Slope, the Brooks Range foothills area on the southern slope, and state-owned offshore Beaufort Sea submerged lands to the north.
In the spring, the sale auctions off unleased lands in the Cook Inlet basin in southern Alaska and also makes state lands on the Alaska Peninsula, in southwest Alaska, available for bids. -- Tim Bradner, firstname.lastname@example.org
-- Edited by Keiron Greenhalgh, email@example.com