Current weather

  • Scattered clouds
  • 54°
    Scattered clouds

Land leased in oil, gas pursuit

Posted: Sunday, November 21, 2004

Unocal, Marathon Oil and several other oil and gas companies leased 17 tracts in the Cook Inlet region owned by the Alaska Mental Health Land Trust during a bid offering Nov. 9.

The land trust, which serves beneficiaries including Alaskans who experience mental illness, developmental disabilities, chronic alcoholism or Alz-heimer's disease and related dementias, put 39 tracts up for lease, receiving 21 bids on 17 of those tracts.

In a Nov. 10 press release, the land trust office said key areas of industry interest were associated with natural gas exploration activities on the west side of Cook Inlet and on the Kenai Peninsula.

Unocal and Marathon bid on tracts on the peninsula, while Aurora Gas LLC, Forest Oil Co. and a newcomer Storm Cat Energy Corp. bid on tracts on the north and west side of the inlet, the land office said.

Individuals Monte Allen and Clyde T. Boyer bid on tracts near Kenai and Nikiski.

"I am very pleased with the outcome," said Mike Franger, senior trust resource manager. "With this sale, the trust nearly doubled the acreage it has leased in the Cook Inlet area since the inception of our leasing program. We look forward to working with the lessees in their efforts to explore and, hopefully, develop oil and gas production from trust land."

According to the land trust office, the sale included some 200,000 acres in the inlet basin and was made up of tracts that previously had been offered for lease.

The Alaska Mental Health Trust Authority manages revenues realized from the sale. Some $700,000 in bonus bids was received from the sale.

Preliminary results showing which companies offered the highest bids were expected to be released late last week, but leases won't actually be issued for about another month, Franger said in an interview.

The land trust will get another $80,000 in first-year rentals from successful bidders, he said. Like those issued by the state in state lease sales, there are royalties involved when hydrocarbon deposits are developed, amounting to 10.5 percent during the first five years, and 12.5 percent thereafter, Franger said.

The trust began its oil- and gas-leasing program in late 2001 and since then has leased nearly 100,000 acres of land. The trust is expected to continue offering land for oil and gas leasing annually. Future sales will consist of acreage not leased in this sale, the trust office said.



CONTACT US

  • 150 Trading Bay Rd, Kenai, AK 99611
  • Switchboard: 907-283-7551
  • Circulation and Delivery: 907-283-3584
  • Newsroom Fax: 907-283-3299
  • Business Fax: 907-283-3299
  • Accounts Receivable: 907-335-1257
  • View the Staff Directory
  • or Send feedback

ADVERTISING

SUBSCRIBER SERVICES

SOCIAL NETWORKING

MORRIS ALASKA NEWS