State to seek offshore test wells near ANWR

Posted: Thursday, August 14, 2003

JUNEAU (AP) State officials hope to entice oil companies into drilling an offshore test well near the Arctic National Wildlife Refuge next winter.

The state Division of Oil and Gas is soliciting interest in a stratigraphic test well to be drilled in unleased state waters of the Beaufort Sea near the east portion of the coastal plain.

''The proposed well would be drilled where it is designed to maximize the recovery of information about a potential reservoir, not to gather oil,'' Gov. Frank Murkowski said in a statement released Wednesday.

The test well would be drilled in an area west of the village of Kaktovik near Angun Point, the state said. It could give companies important geologic data to aid in future exploration decisions about ANWR.

State officials held a meeting with oil companies on Tuesday to solicit interest in the project.

''The overarching purpose is ANWR, but the subsidiary purpose is to understand the geology of the state waters and adjacent federal waters,'' said Ken Boyd, an oil consultant who attended the meeting.

Drilling could begin as early as winter 2004 and 2005, state officials said. The cost of the drilling would not be funded by the state but would be shared by companies interested in the project, the governor's office said.

State officials expect the well to qualify for a 40 percent severance tax credit.

The data garnered from the well would also be shared by the companies, the state said.

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