Another Drilling Rig May Head to Cook Inlet

Cook Inlet may see more than one drilling rig soon.  Escopeta Oil and Gas spokesman Steve Sutherlin told the Anchorage Chamber of Commerce last week that the Customs and Border Protection bureau will likely take action soon to resolve the continuing Jones Act issue that has kept their Spartan 151 jack-up rig out of U.S. waters so far.  The rig was transported by a Chinese cargo vessel, and the owner doesn’t want it seized.  Escopeta is a Texas company with lease holdings in the central part of the Inlet.
Escopeta’s rig can drill in waters as deep as 150 feet.  If it is brought to the inlet and drills, it begins qualifying for up to $67 million in state tax credits.
A second company, Buccaneer, based in Australia, with a Singapore partner, has signed a $30 million financing deal with the state Industrial Development and Export Authority that would bring its Adriatic Two jack-up rig to the Inlet from Maylasia.  The state gets part-ownership, and a deal to keep the rig in the Inlet for a number of wells.  Authority spokesman Karsten Rodvik says Buccaneer’s rig can operate in waters twice as deep as Escopeta’s.

Buccaneer’s offshore prospect is over toward the west side of Cook Inlet and to the north of Escopeta’s.

The company already has a track record in the area, with a new producing natural gas well in Kenai.  They plan to drill up to ten wells there and build a pipeline to whoever will buy that gas.

Buccaneer had hoped to be drilling offshore by this fall, but it now looks like it won’t be ready until next spring.   AIDEA’s Karsten Rodvik says the state tax credits that go to the first company to drill with a jack-up rig played no part in the Authority’s negotiations with the company.

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