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ExxonMobil on Point Thomson defensive



By Upstream staff 

Exxon Mobil has urged Alaska officials not to revoke its leases at the Point Thomson oil and gas field on the state's North Slope region - despite the fact it has not pushed ahead with any commercial development at the field in the past 30 years.

ExxonMobil, majority owner and operator of the field, made the pitch at a hearing held by the Alaska Department of Natural Resources, part of a formal process to prevent what could be the revocation of the field leases.

Last year the department found ExxonMobil and its partners - fellow supermajors BP, Chevron and ConocoPhillips - to be in default of state lease terms for failing to abide by a 2001 agreement to drill development wells according to specific deadlines.

That ruling triggered a legal process to revoke the leases for the field, which lies west of the Arctic National Wildlife Refuge and holds 8 trillion cubic feet of gas and between 250 million and 300 million barrels of liquids, including condensate and oil.

Richard Owen, Alaska production manager for ExxonMobil, said last night that the supermajor has offered alternatives to the 2001 development plan. The latest plan calls for a new well to be drilled in 2008 or 2009, the first at the field since 1983.

"The owners have complied with the unit agreement, the leases and Alaska law," said Owen, adding that ExxonMobil and its minority partners, BP, Chevron and ConocoPhillips, are evaluating all possible options.

ExxonMobil has also offered to pay a $20 million fine, according to terms of the 2001 agreement, and give up about 20,000 acres of leases mostly around the edges of the 116,000-acre unit.

Critics said ExxonMobil's new plan continues its pattern of stalled development and warehousing of Point Thomson's resources.

"It's time to take these leases back. In fact, it's way past time," former state governor Wally Hickel, a Republican, said in testimony at yesterday's hearing.

Last month Department of Natural Resources officials recommended that Alaska revoke the leases for non-performance and put them back on the auction block.

Governor-elect Sarah Palin, a Republican who will take office on 4 December, said the decision about Point Thomson should be left to her incoming administration.

"Due to the unprecedented importance of this decision, it should not be rushed, and should not be decided by a commissioner as one of his final acts before leaving state service," she said in a news release last night.


Tuesday, 21 November, 2006, 09:35 GMT  | last updated: Tuesday, 21 November, 2006, 09:35 GMT

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