Bidders pay $2.7 million for oil and gas leases

ANCHORAGE (AP) -- Bidders ranging from a wildcatter to big oil paid $2.7 million Thursday for 106,200 acres on Alaska's North Slope in an areawide state oil and gas lease sale.

''It was a little on the modest size,'' Department of Natural Resources Commissioner Pat Pourchot said of the lease sale.

The sale resulted in seven-year leases on 32 tracts, divided between offshore Beaufort Sea tracts and North Slope tracts north of Umiat.

Leases on 15 tracts totaling 37,720 acres were sold in the Beaufort Sea area. Leases on 17 tracts totaling 68,480 acres were sold north of Umiat, said Mark Myers, director of DNR's Division of Oil and Gas.

As of Jan. 1, Alaska will have 6.3 million acres under lease on the North Slope.

The sale attracted large companies such as BP, Chevron Texaco, Exxon Mobil and Conoco Phillips, and mid-size companies such as Anadarko Petroleum and EnCana Oil and Gas. Small players included Alaska Venture Capital Group, formed by two oil men in 1999, and wildcatter Alfred James, a Kansas-based geologist who bought a North Slope tract for $46,272.

The minimum bid was $10 per acre. Several bids that fell under the minimum would be dropped from the sale, Myers said.

None of the tracts were new. They were reofferings in already heavily leased areas. Pourchot said the sale indicated decreased competition because of industry mergers.

Conoco Phillips working with Phillips Alpine and Anadarko paid the highest amount for a tract -- $801,280 for 313 acres on the North Slope.

Exxon Mobil bought a tract in the Point Thomson area for $268,522, paying the highest amount per acre -- $6,713. The Point Thomson field was discovered in 1977 but has lain fallow. It edges the Beaufort Sea.

Exxon Mobil last month signed an agreement with the Knowles administration to streamline permitting for the proposed Point Thomson gas field project. Exxon Mobil is looking into extracting a kerosene-like natural gas condensate from the area.

Thursday's lease sale was in contrast to a robust sale held in May in the Foothills area where companies were looking mostly for gas prospects. That sale paid nearly $10.3 million for 197 tracts covering 1.12 million acres.