Blank check for Alaska investment?

Steve Sutherlin

for Petroleum News

Caelus Energy LLC CEO James Musselman, once quite active in Alaska through subsidiary Caelus Energy Alaska LLC, has stirred some excitement lately in the state due to his post as a director of Alussa Energy Acquisition Corp., a blank check company incorporated in the Cayman Islands.

The New York Stock Exchange listed company announced in November that it closed an initial public offering of 25,000,000 units at $10 per unit, resulting in gross proceeds of $250 million.

BTIG LLC later exercised an option to purchase an additional 3,750,000 units at the initial public offering price to cover over-allotments.

Alussa formed “for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses,” it said, adding, “the company intends to focus on businesses in the production, operation and development of crude oil and natural gas wells and related infrastructure.”

Given Musselman’s knowledge of Alaska, some small companies and investors seeking capital for prospects in the state told Petroleum News they are hoping some of that money might find its way to projects in Alaska.

In 2016, Caelus said it made an oil discovery with its two-well Tulimaniq exploration program in Smith Bay off the coast of the National Petroleum Reserve-Alaska, featuring announced estimates of 6 billion to 10 billion barrels of oil in place.

But Tulimaniq had challenges. Located in a remote, environmentally sensitive part of the North Slope, the geology suffers from relatively poor reservoir quality. Both wells have yet to be tested.

Caelus sold 124 eastern North Slope exploration leases to Eni - and dropped others - in 2018.

Caelus sold its 70% operating interest in its flagship Oooguruk field to Eni in 2019 and wound down its Alaska operations. The transaction gave the Milan-based major a 100% working interest in the field.

Caelus told Petroleum News in April that it is winding down its Alaska operations, but it is not entirely divested from the state yet. It said it is looking for an investor or partner to appraise its Tulimaniq discovery in Smith Bay.

Alussa commenced trading on the NYSE under the ticker symbol “ALUS.U” in November. Each unit consists of one of the company’s Class A ordinary shares and one-half of one redeemable warrant. Each whole warrant entitles the holder to purchase one Class A ordinary share at a price of $11.50 per share.

Beginning Jan.10, holders of the 28,750,000 units sold in the initial public offering can elect to separately trade the Class A ordinary shares and warrants included in the units. Class A ordinary shares and warrants that are separated will trade on the NYSE under the symbols “ALUS” and “ALUS.WS,” respectively, the company said in a January announcement.