Buccaneer Energy Ltd., Sydney, started gas production from its Kenai Loop-1 well onshore Alaska’s Cook Inlet on Jan. 14, 2012.
The company will sell gas into Enstar’s winter daily auction, a system by which gas producers are advised of Enstar’s requirements for the next 24 hr and bid the price and volume to sell gas. Enstar’s winter demand requirement is based mainly on weather and can fluctuate daily.
Buccaneer also has the ability to sell gas to ConocoPhillips under its gas sales agreement with the local LNG facility if Enstar does not purchase the well’s full daily production.
Buccaneer anticipates producing the well at as much as 5 MMcfd for 2-3 months while monitoring reservoir performance. Further drilling at Kenai Loop is likely to begin in the second quarter of 2012 prior to the start of Buccaneer’s offshore program in Cook Inlet, the company noted.