COOK INLET OVERVIEW
Senator Giessel Working Group Presentation
September 8, 2015
Corri Feige, Director
Alaska Division of Oil and Gas
AGENDA







Resources and Reserves
Current Activity/New Developments
Who’s Working Cook Inlet?
Cook Inlet as a Maturing Basin
Leasing Activity Trends
Exploration Incentives & Tax Credit Applications
Data Submitted Under Credit Programs
RESOURCE & RESERVES
 Undiscovered, Technically
Recoverable Oil & Gas (USGS 2009):
- mean conventional oil 599 MMBO
- mean conventional gas 13.7 TCF
- mean unconventional gas 5.3 TCF
 Natural Gas Reserves (ADNR 2013)
1.1 TCF (Proved + Probable)
 1.2 TCF additional mean resource
assessed in OCS waters (BOEM,
2011)
CURRENT ACTIVITY & NEW DEVELOPMENTS
 Operations Updates:
o Furie Operating Alaska (Kitchen Lights Unit):
 Monopod platform set this summer; onshore gas facilities & pipeline complete
 Plan 1st gas production late 2015
o BlueCrest Energy, Inc. (Cosmo Unit):



Construction underway onshore facilities; Rig arrival Nov 2015
Plan 1st oil in April 2016 (oil production will be from onshore)
Shallower dry gas to be produced from 2 small monopods (10-12 wells)
o HilCorp Alaska, LLC:
 Purchased XTO Energy, Inc. assets in southern Cook Inlet
o Apache Alaska Corp.:
 Continuing extensive seismic acquisition program (onshore & offshore)
 Permitting new well for 2016
WELLS DRILLED & SEISMIC ACQUIRED
 75 new O&G exploration and development wells drilled 2010-2014
o 22 Exploration, 53 Development
o 36 completed as gas wells (avg = 7.2 new gas wells per year)
o 23 completed as oil wells, 11 suspended, 5 P&A’d
 2D and 3D seismic data acquired 2004-2014
o Line Miles 2D (onshore/offshore)
o Square Miles 3D (onshore/offshore)
=
=
~ 725.3 line miles
~ 657.6 square miles
WHO’S WORKING COOK INLET?
 Large Majors – ConocoPhillips Alaska
 Mid-Sized Independents – HilCorp Alaska, LLC & Apache Alaska Corp.
 Small Independents & LLCs -•
•
•
•
•
•
•
•
Alaska Energy Alliance Inc
AIX Energy LLC
Aurora Exploration LLC
Aurora Gas LLC
Bluecrest Energy Inc
CIRI Production Company
Cook Inlet Energy LLC
Alaska LLC
* CIRI
* Cornucopia Oil & Gas Company LLC
* Corsair Oil & Gas Company LLC
* Furie Operating Alaska LLC
* New Alaska Energy LLC
* NordAq Energy LLC
* Taylor Minerals LLC
* Woodstone Resources LLC
COOK INLET AS A MATURING BASIN
 Basin has matured – large producers (Chevron, Marathon, etc.) have sold
assets as they have aged and begun to generate lower ROR’s.
 Entrance of mid-sized Independents like HilCorp & Apache who take up the
existing assets & dominant acreage positions that fit their business models
(cost reducing, “fact track” upgrades, producing reserves that were behind
pipe).
 Small LLCs enter to take the smaller acreage positions & explore plays
adjacent to production.
o These entities grow in number when prices are high & then consolidate when
prices drop. Administratively, DOG is processing a significantly higher number of
transfer & assignments in support of this company group. Smaller companies
tend to be more fluid in order to leverage the positions & finance operations.
LEASING ACTIVITY TRENDS
Cook Inlet Areawide Lease Sale Results: 1999 - 2015
110
2
100
# of tracts with multiple bids
90
# of tracts with single bids
# of tracts receiving bids
80
70
6
60
5
8
1
30
20
106
8
50
40
14
59
3
41
27
10
1
47
4
3
53
35
29
7
2
26
18
13
37
33
5
25
30
1
1
6
3
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Cook Inlet Areawide Lease Sale
2010
2011
2012
2013
2014
2015
EXPLORATION INCENTIVES & TAX CREDIT
APPLICATIONS – DNR
 Credits Included – AS 43.55.023(a)(2); AS 43.55.023(I)(2)
AS 43.55.025(all types – currently 7)
 Credit Activity 1999 – 2015
o 19 distinct seismic programs and 34 wells that applied for DNR related
tax credits.
 All Have Data Submittal Requirement
o Data submittal 30 days after completion of seismic or geophysical
data processing, completion of well drilling or filing of a claim for
credit, whichever is latest.
 Well Data - Released 24 months after filing
 Seismic or Other Geophysical Data – 10 years
Number of Applications
AS 43.55.023 Exploration Tax Credit Applications – Cook Inlet
50
45
AS 43.55.023 - CI - Well
AS 43.55.023 - CI - Seismic
2
2008
17
15
8
2009
15
2
2010
2011
5
2012
2013
Fiscal Year
10
7
2
2014
2015
2016
Number of Applications
AS 43.55.025 Exploration Tax Credit Applications – Cook Inlet
11
AS 43.55.025 - CI - Seismic
1
2009
3
6
4
1
2010
2012
1
2013
Fiscal Year
2014
2015
2016
AS 43.55.023 & .025 Projects Applied for in Cook Inlet
7
Number of Projects
6
AS 43.55.023
4
AS 43.55.023 & .025
4
3
AS 43.55.025
Linear (AS 43.55.023)
3
2
3
Linear (AS 43.55.023 & .025)
2
Linear (AS 43.55.025)
2
1
1
1
2004
2005
1
2006
2007
1
2008
2009
Year Work Began
1 1
2011
2012
2013
2014
Cook Inlet AS 43.55.023 & .025 Exploration
Projects by Year & Subsurface Ownership
Number of Projects
4
3
3
2
1
Public
Private
Mixed
5
2
1
2
2004 2005
2006
1
1
2007
2008
5
5
5
2012
2013
2014
1
2009
2011
Year Work Started
Cook Inlet Data Received in Excess of Standard Data
37.21%
No
Yes
62.79%
AS 43.55.023 & .025 Exploration Tax Credits
3D Square Miles Acquired
Number of Square Miles
53.503
200
Sum of Square Miles - Onshore
Sum of Square Miles - Offshore
209.27
0
38.799
0
2004
2005
69.707
0
17.109
2007
49.16
20.01
0
2009
2011
Year Work Started
2012
0
0
2013
2014
AS 43.55.023 & .025 Exploration Tax Credits
2D Line Miles Acquired
Number of Line Miles
140.168
Sum of Line Miles - Onshore
Sum of Line Miles - Offshore
404.981
114.854
0
0
0
2004
2005
2007
0
20.148
6.03
2009
2011
Year Work Started
0
38.783
0.325
2012
2013
2014
Estimated Commercial Value of Seismic Credit Data
Estimated Acquisition Cost
$98,129,125
$67,093,830
$5,742,700
2004
$13,810,675
$9,311,760
$4,802,400
$4,106,160
2005
$63,065,520
2006
2007
2008
2009
2011
2012
2013
2014
Year Acquisition Began
Conservative estimate of Total Acquisition Costs =$266,062,170
Does not include permitting & baseline environmental costs or post-processing
QUESTIONS?
THANK YOU!
550 W. 7TH AVE, STE. 1100, ANCHORAGE, AK 99501
www.dog.dnr.alaska.gov