Preliminary finding for GeoAlaska permit
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South Augustine Island noncompetitive geothermal prospecting permit would be issued for two years, with possible extension
Kristen Nelson Petroleum News
In April of last year GeoAlaska LLC, owned by Dr. Paul Craig, proposed a South Augustine Island noncompetitive geothermal prospecting permit. The Alaska Division of Oil and Gas issued a call for public comments and competing proposals in June 2021, but no competing proposals or comments were received, the division said in an April 28 preliminary written finding of the director. The preliminary finding, subject to public comment closing May 30, is that disposing of the South Augustine Island geothermal prospecting permit is in the state’s best interests.
The permit would be for two years at a rental rate of $3 an acre for 3,048 acres of onshore portions of three tracts, ranging from 320 to 2,240 acres. This acreage is on the southern portion of the island.
Augustine Volcano A summary of the decision said relevant facts and issues include the value of research and monitoring of Augustine Volcano; value of habitat, fish and wildlife; value of Lower Cook Inlet commercial and recreational facilities; potential cumulative effects from a geothermal power plant; and potential benefits of geothermal energy for Southcentral Alaska.
Augustine Island is in Kamishak Bay on the west side of Lower Cook Inlet, the decision said, some 68 miles southwest of Homer and some 170 miles south-southwest of Anchorage.
The permit consists of the southern portion of the island, all on state-owned land.
The Alaska Volcano Observatory monitors Augustine Volcano with web cameras, digital seismometers, infrasound networks and global positioning system receivers at 15 sites.
Augustine Volcano has had at least six eruptions between 1812 and 1998 and most recently in 2006, the division said.
The decision said that while subsurface and geologic data related to geothermal production capacity on the island is not available, the resource potential is indicated by the presence of the volcano.
Development activities The decision said work on the Augustine Island geothermal project “would begin with an initial survey and explorat
ion phase that could include geological and geophysical surveys and drilling of one or more exploration wells to determine the size and temperature of the resources.”
If the resource were deemed commercially viable, “development of the project would likely include construction of wells and pipelines, a power plant with turbine and cooling system facilities, roads, personnel housing, transportation and maintenance facilities, and subsea power transmission lines most likely to Anchor Point or Homer.”
GeoAlaska A year ago, in May 2021 the division issued a final finding for a noncompetitive geothermal prospecting permit for Northwest Mount Spurr, also to GeoAlaska. The division said the permit area is on the southern flank of Mount Spurr and is referred to as Northwest Mount Spurr because it is adjacent to and northwest of a previously issued Mount Spurr noncompetitive geothermal prospecting permit.
This area is some 6,376 acres in three tracts northwest of Trading Bay and some 40 miles west of Tyonek.
The Northwest Mount Spurr permit is also for two years, with a potential of a one-year extension.
Craig formed GeoAlaska in May 2020 to identify and develop geothermal energy resources in Alaska.
He told Petroleum News in 2021 (see stories in May 30, 2021, and June 6, 2021, issues) that he isn’t switching industries. “For 28 years I have been in the energy industry,” Craig said.
“GeoAlaska is trying to move Alaska’s energy industry one step forward into the future by creating a source of green electrical energy that has a zero-carbon footprint on the environment. We are not anti-oil. We are not anti-natural gas. we are pro-business and pro-energy, but we want to do it in a way that creates a sustainable future for our children and our grandchildren for generations to come.”
Working with Erik Anderson Craig said Erik Anderson brought Mount Spurr and geothermal potential in Southcentral to his attention.
“Erik had heard about my oil patch entrepreneurship and decided to approach me.”
Anderson’s background, Craig said, is in hydrology and he has worked on various geothermal projects, including “a very successful geothermal exploration program at Nevis in the Caribbean.” Anderson worked on the geothermal program at the Alaska Department of Natural Resources a few years ago, Craig said, and is now an independent consultant.
“We will be working to tie the electricity we hope to produce into the Railbelt electrical grid,” Craig said in 2021 discussing the Northwest Mount Spurr permit. He said he had a letter of intent with a potential power purchaser who “would be delighted to purchase our electricity if it can be reasonably priced.”
Craig also said GeoAlaska had identified a new drilling rig for the Mount Spur Project. He said the rig, built in Alaska, can be transported by helicopter. “No component weighs more than 4,000 pounds. And it fits together like a big Lego set.”
Discussing the Northwest Mount Spurr permit, Craig said GeoAlaska’s goal is to drill to about 3,000 feet.
Craig said last year that he would be looking for financing for the project. As of this issue of Petroleum News, the Alaska Oil and Gas Conservation Commission appears to have issued no drilling permits to GeoAlaska.
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