Australian company seeking natural gas in Point MacKenzie

State officials are nearing a decision on whether an Australian company will be allowed to seek natural gas in the Point MacKenzie area.

Linc Energy Operations Inc. could begin constructing its so-called LEA#1 well as early as this week.

Linc Energy’s Australia-based spokesperson, Greg Meyer, did not immediately reply to an e-mail seeking comment, but an Aug. 16 Austock Securities research report mentioning the project stated, “Lea #1 is a wildcat exploration well within 20km of Anchorage city, targeting multi-hundred billion cubic feet of gas. … The site is within 5 miles of an inlet valve to an under-utilised 20inch gas pipeline which feeds to the power station and beyond to Sarah Palin’s neighbours!”

Information Linc submitted in its applications for necessary state and federal permits, stated the vertical well will be situated on a 10-acre site about two miles north of Point MacKenzie Road, off Goose Creek Road. An approximately 2.2-acre gravel pad will support drilling operations.

“We received no public comments,” said Nina Brudie, an oil and gas project review manager for the state’s Alaska Coastal Management Program. “I was not particularly surprised because they’re putting a well pad on a previously disturbed piece of property. It doesn’t involve filling raw wetlands, doesn’t have the level of environmental impact it would otherwise have. They’re using existing access roads to access the site.”

Susan Lee, a Mat-Su Borough planner, said the state supervised scrutiny of the proposed Linc Energy project and the borough reviewed the project to ensure it complied with coastal management policies.

The LEA #1 well will target conventional natural gas in the Middle and Lower Tyonek Formations as well as the Hemlock Formation. The well will be located less than two miles from the Enstar 20-inch natural gas pipeline.

The Linc Energy well site is situated more than four miles from the coast, according to a coastal project questionnaire and certification statement submitted by Linc Energy’s project manager Corri Feige. It is not expected to affect the nearest body of water, Goose Creek, which is about a half mile to the northeast of the anticipated project site.

The questionnaire also stated that the area surrounding the proposed well location is sparsely populated and that the drill rig to be used at the site is equipped with residential-grade mufflers to further reduce noise.

Dry drill cuttings will be permanently disposed of in the Mat-Su Central Landfill and fluids — including any produced water — will be disposed of by a commercial disposal service or through an annular injection permit from the Alaska Oil and Gas Conservation Commission.

An archaelogist surveyed the proposed drilling site in June to ensure construction would not affect or damage historical or cultural resources in the area. A report of the survey findings was filed with the State Historic Preservation Office and the Mat-Su Borough’s historical preservation office in July.

All water required for the drilling process, the questionnaire stated, will come from either a pre-existing water well at the site or purchased and transported to the location.

The well will be drilled to an approximate bottom hole depth of 7,000 feet.

“The well will be lined with steel drill casing and cemented to approximately 1,500 feet, well below zones used for drinking water. Only water-based drilling fluids will be used, deploying standard drilling industry practices.”

Temporary drilling activities at LEA No.1 are expected to last three to four weeks and equipment will be removed after drilling has ended. If the company discovers natural gas at the site, it could later proceed with getting authorization to drill a delineation well and continue exploration. If the results of the initial drilling prove to be disappointing, the company would plug and abandon the well.

Initial drilling is expected to continue through December. Additional well testing or planning for additional wells is slated for January through March 2011, if required.

Advance prospect exploration — selection and permitting of additional wells and related tasks — could take place between April 2011 and January 2012.

“Discovery of a natural gas resource would meet both the local community and broader community needs in South-Central Alaska,” the questionnaire stated. “…drilling techniques that allow for multiple wells to be drilled from a single location would be considered in the future, if appropriate for development and geologic realities.”