By Yereth Rosen
ANCHORAGE, Alaska, May 8 (Reuters) – U.S. oil & gas
exploration and production company Hilcorp Energy Co built on
its recent Alaska foray by picking up 19 new leases in the
declining Cook Inlet in the southern part of the state,
according to early results from a state auction on Wednesday.
Privately owned Hilcorp spent $2.6 million of the total
$4.46 million in high bids offered for 28 tracts sold at the
state’s Division of Oil and Gas lease sale, according to the
preliminary results.
The company started its Alaska operations last year, when it
acquired Chevron Corp’s Cook Inlet properties and much
of those owned by Marathon Oil Corp.
The Cook Inlet basin is Alaska’s oldest oil and gas basin,
dating back to the 1950s. Production peaked in the early 1970s
at 230,000 barrels per day, but is now at about 12,500 bpd.
“We believe there’s a lot of life left in Cook Inlet,” said
Lori Nelson, spokeswoman for Hilcorp’s Alaska operations.
Houston-based Hilcorp will invest $300 million to $350
million in Cook Inlet this year to increase output at the fields
once owned by Chevron and Marathon, said Bill Barron, director
of the Division of Oil and Gas. He said Hilcorp specializes in
“brownfield oil development”, or reviving old assets.
Also acquiring new leases in the inlet were Aurora Gas,
Nordaq Energy Inc, Cook Inlet Energy and Woodstone Resources.
The state also sold a geothermal lease at Augustine Volcano,
which makes up its own island in southern Cook Inlet and last
erupted in 2006, to a private investor. It was the first such
sale for the volcano, located 175 miles southwest of Anchorage.
The state has held three geothermal lease sales for tracts
on Mount Spurr, an 11,070-foot volcano about 75 miles west of
Anchorage. Nevada-based Ormat Technologies Inc, which
acquired Spurr leases in 2008, has been doing exploration there.
