Unocal finds natural gas on Alaska's Kenai Peninsula

Nov 21, 2003 01:00 AM

Unocal announced the discovery of a major natural gas field on the Kenai Peninsula. The Happy Valley field, about seven miles southeast of Ninilchik, is estimated to contain about 75 bn to 100 bn cf of recoverable natural gas. That's enough to supply all of regional gas distributor Enstar's South-central market for three to four years, said Roxanne Sinz, Anchorage spokeswoman for Unocal, based in El Segundo, California.
"For Unocal in Alaska, it's the largest gas field we've found in 20 years," she said. "We're real pleased."

Exploratory drilling on the Happy Valley prospect began in early June. The company laid out plans to drill three development wells next year, plus a 12-mile pipeline to move the gas to Enstar, which supplies Anchorage and other South-central markets. The pipeline would be an extension to the recently constructed, 33-mile Kenai Kachemak Pipeline, Sinz said. Unocal expects first production from Happy Valley in about a year. Spending on the project is expected to total $ 50 mm over the next two years, Sinz said.
The discovery significantly boosts natural gas reserves around Cook Inlet, which has long provided cheap gas for heating and powering the region. Recently, however, worries have cropped up that the gas supplies could run out in as soon as 10 years. The dwindling reserves, coupled with rising prices for natural gas, have prompted numerous companies to begin looking for more.

Unocal is Cook Inlet's dominant player, having made its first gas discovery in 1959. Its operations include eight offshore production platforms. It's also a partner with Marathon Oil on another recent gas discovery, the Ninilchik Unit, which began production in September.
At a Resource Development Council conference in Anchorage, executives with several companies described promising gas exploration and production efforts. Scott Pfoff, president of Aurora Gas of Houston, Texas, said his company is making good progress on the west side of Cook Inlet exploiting known gas accumulations thatmuch larger companies like Mobil essentially ignored many years ago in their search for crude oil.
"We need small companies out there exploring for and developing gas in Cook Inlet," he said.

Source: Anchorage Daily News
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