Marathon Oil finds Natural Gas prospect with CIRI land
By Tim Bradner
Marathon Oil Co. has encountered “a zone of interest” in an exploration well on the Kenai Peninsula, company officials said.
The well was being closely watched because of concerns over natural gas shortages in Southcentral Alaska.
“Marathon has completed drilling the Sunrise well in the Cook Inlet of Alaska. The well encountered a zone of interest and we are continuing to evaluate the results to determine commerciality,” Marathon Alaska Manager Carri Lockhart said in a statement.
The company would not provide further information.
Sunrise is a natural gas prospect drilled within the Kenai National Wildlife Refuge, with the subsurface rights held by Cook Inlet Region Inc., an Anchorage-based Alaska Native regional corporation.
CIRI spokesman Jim Jager said it premature to comment on the drilling result.
Sunrise is located about 40 miles east of the city of Kenai. State geologists have said the area within the wildlife range where Marathon drilled has considerable untested potential, mainly for gas.
Subsurface mineral rights in parts of the refuge are owned by private Alaska Native corporations, mainly CIRI and Tyonek Native Corp.
However, surface access is limited by stringent U.S. Fish and Wildlife Service permitting requirements.
Marathon has been working to secure permits for the Sunrise well for almost a decade.
Sunrise is considered important because reserves in existing producing fields in Southcentral Alaska are being depleted and regional utilities are worried about meeting annual gas supply requirements beyond 2012 to 2014, when annual production is predicted to fall below annual demand for space heating and power generation.
Marathon’s is the first gas exploration well drilled in many years. The company is now the operator of several producing gas fields on the Kenai Peninsula.
Alaska has large reserves of gas 800 miles north on the North Slope and a pipeline is being proposed, but it would be at least 10 years before it could be in operation.
The state of Alaska is also studying the potential for a separate 24-inch “bullet line” that could bring gas from the North Slope to Southern Alaska, but the economics of that are uncertain.
Studies by the Alaska Division of Oil and Gas indicate potential for new discoveries as well as some further development in existing fields, according to Kevin Banks, director of the division.
The state is looking for ways to encourage more exploration in the region, Banks said.
