Those who watch the Cook Inlet’s oil and gas patch had reason to celebrate on Monday as details of a deal between Buccaneer and ConocoPhillips emerged that will not only benefit those companies, but also the community at large.
Per the deal, Buccaneer can drill deep for oil in ConocoPhillips’ North Cook Inlet Unit, which is known for its shallow gas, but has deeper oil as discovered, but not produced, by ARCO.
For ConocoPhillips the deal is an opportunity to make some money with no risk and no capital.
For Buccaneer, the deal gives them more elbow room to drill in that area as they planned to do in the nearby Northwest Cook Inlet prospect. It also gives them a working relationship with an established major that has a nearby platform that could perhaps be retrofitted to get product to market.
Moreover, the deal gives the Endeavour more targets on top of the Cosmopolitan, Southern Cross and Northwest Cook Inlet areas. The company has stated that it would seek to lease the Endeavour for drilling in the arctic, but as those drilling plans appear to be several years off, the deal seems to have given the Endeavour more reasons to stay in Cook Inlet.
Make no mistake — the more oil and gas that comes out of Cook Inlet, the better. Taxes on the oil and its associated drilling assets benefit state, borough and local governments and provide countless jobs for industry workers. Gas is needed to stave off looming shortages predicted by utilities. Bottom line: the longer the area’s jack up rigs can stay working, the better.
Also, it’s been a while since we’ve seen oil and gas companies working together. That’s a refreshing sight in a state where company plans are kept close to the vest and competition is built into every facet of the business, from leasing to exploration and production.
Are there other opportunities for partnership in other fields amongst neighboring companies?
We hope so because there is a decided mix of philosophies in Cook Inlet right now — companies like ConocoPhillips, who are established but are leaving their assets static, and companies like Buccaneer, who aren’t fully established but have big plans to breathe life in aging fields.
Seeing the two philosophies work together to benefit the industry and the community is exciting to watch.
Keep it up.