Bidding was modest in the state’s annual Cook Inlet areawide lease sale held May 7, a symptom of low crude oil prices and a limited regional market for natural gas.
The state Division of Oil and Gas auctioned seven oil and gas leases May 7 to three companies. Hilcorp Energy LLC and AIX Energy LLC, two producers in the region, bid on and were awarded tracts along with Woodstone Resources LLC, a small independent company based in Texas.
Corri Feige, director of Alaska’s Division of Oil and Gas, said the state collected $749,819 in bonus bids on seven tracts. The most aggressive bidding came on three tracts east of Homer, on the southern Kenai Peninsula, near where Buccaneer Energy drilled an unsuccessful exploration well two years ago.
One bid in that area, on Tract 790, came from Hilcorp Energy for $210,486, the highest bid of the sale. Woodstone Resources bid on two nearby parcels, with bids of $145,152 for Tract 789 and $126,280 for Tract 788.
The only competitive bids in the sale were on one tract adjacent to the small Kenai Loop gas field near the city of Kenai. AIX Energy, which owns and operates the Kenai Loop field, bid $66,091 and was high bidder on Tract 158, but Woodstone Resources offered a competing bid for the lease, for $44,625.
Hilcorp Energy bid and won on a nearby Tract 126, for $67,746.
Woodstone Resources also bid $64,720 and won one tract on Cook Inlet’s west side, Tract 437, near the village of Tyonek. In total, that company acquired three tracts in the sale, while Hilcorp Energy and AIX Energy acquired two tracts each.