Oil patch insider: Chill out Glacier, Apollo; you’re selling Badami at really bad time

Kay Cashman

Petroleum News

Glacier Oil and Gas President Stephen Ratcliff has not yet responded to Petroleum News’ mid-June query as to whether Glacier still has its Badami leases and infrastructure up for sale - not unusual in a situation involving business negotiations with third parties.

But three solid PN sources have confirmed the eastern North Slope asset is still up for sale - and one of them said Glacier has been “aggressively” marketing Badami, which is operated by Savant, a Glacier company.

All three sources agreed that now is the worst possible time to be selling Badami: “Alaska is really unpopular with investors. What with the banks boycotting the state and fear of reprisal from Biden et al and all their green hysteria. But this just needs to run its course,” one source said. “In my humble opinion, Apollo and Glacier need to chill out on their sale as they are selling into a super bad market. Oil could be $100 a barrel a year from now.”

Another PN source pointed to the fact that “Armstrong and Oil Search have all that acreage south of Badami, which they expect to be drilling in the next year or two. That alone will increase Badami’s value, especially if they find what they expect to. And so far, their track record on the North Slope is excellent,” he said.

“And if they can snag Glacier’s president, Stephen Ratcliff, who is a technical whizz, they can use Badami’s infrastructure as a hub for the area,” he continued, pointing to Badami’s 38,500 barrel-a-day processing facility and multiple access points,” which is almost exactly what the first broker of the Badami assets said in November - BMO Capital Markets Energy Group.

Note: Badami production has been slowly dropping, although some of it is a seasonal variation. Last fall it was producing about 1,400 barrels of oil per day; in April it was at 1,307 bpd and in May 1,143 bpd.

Another one of BMO’s bullet points was the many access points, including “via barge landing and 5,500-foot airstrip.” Another was the “70 mbo/d capacity Nutaaq pipeline owned and operated by Glacier (12” diameter, 25 miles long) that connects Point Thompson to Endicott.”

BMO no longer has the property listed.

The next place Badami was listed, per one of the PN sources, was on Datasite.com under the site name Grizzly. That was a month ago, but it is no longer there, he said, and PN was unable to find it anywhere else.

“Maybe they took it off the market,” he said, noting it was a buyers’ market.

Most data rooms can only be entered with an invitation, so Glacier/Apollo could have set up a data room elsewhere. Or, of course, they could be in final negotiations with a solid buyer.

The word on the street a few weeks ago was they had a buyer, but no formal/public applications surfaced at the state level. Alaska’s Division of Oil and Gas must approve new owners and lease transfers, even for simple stock transactions.

In the case of new owners, the primary controlling new entity must prove both its technical and financial wherewithal.

Stay tuned …

- KAY CASHMAN