Linc Energy (Alaska) Inc. has allowed almost all of its leased Cook Inlet acreage to expire.
The local subsidiary of an Australian independent allowed 26 state of Alaska leases to expire in early June, keeping one state lease currently proposed for unitization, its Alaska Mental Health Trust leases and exploration licenses, and its Cook Inlet regional Native corporation leases.
The leases are split into two blocks on either side of Cook Inlet -- a 10-lease block in the Trading Bay area and a 16-lease block along the Knik Arm north of Point MacKenzie.
Pioneer Oil originally acquired the leases in 2005 on a seven-year term but eventually sold the leases to San Francisco-based independent GeoPetro Resources. Linc picked up the leases as part of a 123,000-acre Cook Inlet acquisition from GeoPetro in March 2010.
Originally, Linc planned to drill a well on each block.
While Linc drilled the LEA No. 1 well on the Point MacKenzie leases in late 2010 and plans to continue exploring the area, it never drilled a well on the Trading Bay leases. Shell discovered gas near the Trading Bay leases while looking for oil in the 1960s but didn't pursue development because of the low value of Cook Inlet gas at that time.
Linc plans to continue exploring in the area north of Point MacKenzie. The company kept one Cook Inlet lease. In May 2012, Linc applied to form the 1,950-acre Angel unit combining the state lease and a contiguous Alaska Mental Health Trust lease.
The proposed three-year unit agreement includes plans for 2-D and 3-D seismic, drilling and potential development of conventional natural gas resources in the area in the future.
Linc said it expects a decision about the unit by mid-August.
LEA No. 1 encountered natural gas but Linc originally decided the field could not be developed economically. After analyzing the region further, the company announced its interest in returning to investigate a feature of the Pittman Anticline.
In addition to its conventional gas program, Linc is currently exploring the potential for underground coal gasification development over an Alaska Mental Health Trust exploration license spread across three large sections of the Interior and Cook Inlet.
Linc also plans to explore the North Slope Umiat oil field this coming winter.