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Buccaneer says it can produce 10 million cubic feet of gas daily

Posted: March 20, 2013 - 8:11am

Buccaneer Energy says it expects to produce 9 to 10 million cubic feet of natural gas daily from two wells at its small Kenai Loop gas field and that permanent production facilities have now been completed.

While that’s not a huge amount of production, it is a welcome addition to tight natural gas supplies in Southcentral Alaska.

The company has been selling gas to Enstar Natural Gas Co. for $6.24 per thousand cubic feet, or mcf, at an annual average, under a contract that calls for Buccaneer to supply up to 5 million cubic feet per day, Buccaneer said in a March 15 press release. 

Buccaneer said its production above 5 million cubic feet a day is being sold for high prices to other customers. Last November the company contracted to sell half a million cubic feet of gas daily to an unidentified buyer who paid $15 per mcf. 

“Gas prices in Southcentral (Alaska) reached $22 per mcf during the winter peaking demand period. This pricing underlines the critical shortage of gas in this region,” Buccaneer said March 15.

The Kenai Loop field, which is near the city of Kenai, was estimated by Buccaneer to hold 1.1 billion cubic feet of gas based on results of the first well drilled in 2012, Kenai Loop No. 1. The estimate is now being revised based on production data from the Kenai Loop No. 4 well last fall, the company said March 15. Kenai Loop No. 3 was unsuccessful, while the well designated as Kenai Loop No. 2 has not yet been drilled.

Three wells drilled to date at Kenai Loop are from a single production pad at the surface, but the bottom locations of the wells are far apart in the underground reservoir. The bottom of Kenai Loop No. 4 is about 1,800 feet from that of Kenai Loop No. 1.

Permits for Kenai Loop No. 2 well call for it to be drilled from a second pad, however. Drilling of another well is now being planned.

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