State oil lease sale on Alaska's North Slope sets bid record
This year is a record one for the Alaska Department of Natural Resource's fall competitive oil and gas lease sale. According to Chantal Walsh, director of the state's Division of Oil and Gas, the state saw the highest average dollar price per acre on bids in Alaska's North Slope area since the state began sales in 1998.
On Wednesday, the average bid per acre was $110, compared to $99.86 in 1998, according to Walsh.
"We're overwhelmed by the amount of bids that came in, duplicative on leases, that really drove the price of the leasing up and it was very exciting," said Walsh. "I think the new releases of finds on the North Slope are being recognized ,and people are excited about them and interested in leasing. It's the start of a process, and we couldn't be happier with the results of today."
One of the bigger bidders is Repsol, a Spain-based company which had previously scaled back its investment in Alaska.
"This is one of our focus areas and this is the initial, you know, us getting revamped and excited about Alaska," said Jason Sebastinas, senior landman for Repsol's North America land department.
Sebastinas says the company wants to expand its Nanushuk project.
"We've already invested a lot in this project and we see a lot of value in Alaska and so, we are making a push to get a return," Sebastinas said.
Oil industry worker Mark Fairbanks said he's back in the sector, after being laid off in spring 2016.
"I was collecting unemployment, but that doesn't pay much compared to working for a company for 30 years," Fairbanks said.
Fairbanks hailed the news of Wednesday's sale results, noting that a number of his former colleagues haven't returned to oilfield work.
"That's good -- sounds like the best lease sales in the last 20-25 years," Fairbanks said.
The sale was certainly a bright spot for the industry in Alaska. According to the state Department of Labor and Workforce Development, there were 14,200 oil and gas jobs in Alaska in 2015, but that number dropped to 11,300 in 2016. That's 2,900 oil and gas jobs lost in just one year, equivalent to a more than 20 percent drop for the industry.
Overall, the state received 124 North Slope area bids from 11 different groups, totaling $19,939,000. According to Walsh, that's the third highest total bid amount in the last two decades.
Joe Vigil contributed information to this story.
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