Mount Redoubt can be seen across Cook Inlet from North Kenai Beach on Thursday, July 2, 2022. (Erin Thompson/Peninsula Clarion file photo)

Mount Redoubt can be seen across Cook Inlet from North Kenai Beach on Thursday, July 2, 2022. (Erin Thompson/Peninsula Clarion file photo)

Hilcorp only bidder in Cook Inlet oil and gas lease sale

8 million acres were available for bidding in the sale, spread across Cook Inlet and the Alaska Peninsula region

Hilcorp Alaska was the only bidder in a Cook Inlet Oil and Gas Lease Sale that began in late May and closed last week, according to results published by the State Department of Natural Resources on Wednesday.

A release from the department says that 8 million acres were available for bidding in the sale, spread across Cook Inlet and the Alaska Peninsula region. Bids were only received for areas in Cook Inlet, and only from Hilcorp Alaska.

Hilcorp will claim 4,400 acres in Cook Inlet, paying a cash bonus of around $178,000 to the state. Hilcorp made three successful bids, the largest for 2,500 acres near Pretty Creek, Lewis River and Ivan River on the west side of the inlet north of Tyonek, and two smaller tracts in the onshore Sterling Unit.

This sale, per the release, is the second to feature a net profit revenue share rather than traditional royalties. The release and a list of bids recieve says that the share is set at 5% of net profits.

Hilcorp was one of two bidders in another lease sale in December, where they picked up around 13,000 acres for a cash bonus sum of around $530,000. They were the lone bidder in a state sale the year before, when they claimed 23,000 acres for for $359,000.

Both the sale that ended this month and the sale in December fell in the same fiscal year, the release says, and together they represent a sale of leases for more than 19,000 acres. That is significantly higher than the five-year annual average for Cook Inlet, at 13,000 acres, but much fewer than the highest annual sales recorded in 2022 which represented around 28,000 acres.

“While the State of Alaska is disappointed by the low level of interest in this sale, it is encouraging to see Hilcorp continuing to invest in oil and gas leases in Southcentral Alaska,” says Department Commissioner John Boyle in the release.

Full sale results can be found at dog.dnr.alaska.gov.

Reach reporter Jake Dye at jacob.dye@peninsulaclarion.com.

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