The company has 30 days to accept the license, according to Pat Galvin, petroleum land manager at the state Division of Oil and Gas. The term of the license, approved Sept. 7, is for seven years. However, Bristol Shores must meet the annual work commitments agreed to in the license, Galvin said.
Bristol Shores was formed last year by four Alaskans, Henry and Harvey Shade, Ernie Sifsof and Clyde Peterson. Gere Allen, a Connecticut-based development consultant, is working with the company to line up investors who would finance a three-dimensional seismic survey in promising parts of the license area.
Allan said there are four potential investors looking at the project.
Following an initial exploration effort, Bristol Shores could work to attract a major oil and gas company or a major independent company, Allan said. It could also contract for drilling and development.
Allan said a major Japanese trading company with experience in liquefied natural gas is interested in working with the company if significant gas discoveries are made. The identity of the Japanese company was not disclosed.
Discoveries of 5 trillion cubic feet of gas would be needed to justify an LNG export project, however.
Bristol Shores has also met with state officials to discuss the idea of a 300-mile pipeline to connect any discoveries in the Bristol Bay area with existing gas pipelines on the west side of Cook Inlet.
Granting of an exploration license for the northern part of the Bristol Bay basin is the first phase of Gov. Frank Murkowski's plan to have state lands in the region explored.
A conventional oil and gas lease sale is planned in October 2005, in the southern part of the basin, and plans for the sale are on track so far, Galvin said.
Mark Myers, director of the Division of Oil and Gas, said the geologic basin is deeper in the south and prospective for oil as well as gas discoveries. Because there is more potential in the south, the state decided to hold a conventional lease sale in the area, Myers said.
In the northern area, the basin is shallower and the potential is for natural gas found at shallower depths.
Because of this the state decided to issue an exploration license to encourage exploration in the region, Myers said.
An exploration license gives an explorer access to a larger area for exploration over several years. Instead of a traditional lease won by a competitive bonus bid with the state, a company seeking an exploration license negotiates a work commitment agreement with the state.
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