BlueCrest Energy, Inc.

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AIDEA is playing a key role in BlueCrest Energy’s >$300 million Cosmopolitan oil development project.  This project is providing the development and production of new oil from the Cook Inlet.  The Cosmopolitan oilfield was originally discovered more than 30 years ago, but remained undeveloped until now.  New exploration drilling performed in 2013 by the Endeavour – Spirit of Independence jackup drilling rig (a prior AIDEA project/investment) delineated significant additional oil reserves that led to BlueCrest’s investment in the project.  BlueCrest then approached AIDEA to consider an investment into the project that started with a 2014 Cost Sharing Agreement provide funding for 3rd party consultants to confirm the project’s economics and proposed development approach.  The positive results from this due diligence led to BlueCrest’s request for AIDEA’s participation/investment via direct project financing for their purchase of a new extended-reach high-horsepower drilling rig that is now being used to reach and produce the oil from the onshore project site.  AIDEA’s Board approved the loan request in April 2015.  The rig was completed in June 2016 and the first well was spud (started) on November 26, 2016.  First oil from the project and the new oil production facility was achieved in March 2016 through an existing former exploration well.  This new rig provides unmatched capabilities, enabling safe and efficient drilling that will be conducted over a 5+ year period.  AIDEA’s loan also provided funds for the construction of a new man-camp that now houses many of the rig workers; the man-camp was built locally at Builder’s Choice, Inc. in South Anchorage.  Following successful drilling, the Cosmopolitan project is expected to nearly double current Cook Inlet oil production rates, displacing imported oil at the Kenai refinery.



Economic Benefits

Estimated state royalty and production tax payments of more than $150 million over the life of the project; 
  • More than 100 jobs due to development drilling and rig operations; total project job count is now >150, with 90% Alaska residents
  • More than $20 million in new property taxes to the Kenai Peninsula Borough over first ten years of the project; and
  • Up to 30 on-site permanent production facility related jobs and at least 30 permanent truck driver jobs



  • Status Update
    The drill rig started operations on November 26, 2016 and is currently drilling the first well, with anticipated completion in Spring 2017. Approximately 200 barrels of oil per day are being produced and sold to the Tesoro refinery via the existing Hansen 1A-L1 well. The AIDEA Board also recently approved modifications to the BlueCrest loan via Resolution No. G16-14.


    Leverage

    AIDEA’s $30 million loan for the new drill rig leveraged over $300 million of private sector investment into the project. 

    Project Fact Sheet