Just weeks after top executives for Buccaneer Alaska were fired, the company is making moves to shore up its financial situation.
In a news release Wednesday, the company said it was selling off its remaining 25% interest in the Cosmopolitan drilling project, just off Anchor Point for $41 million. The sale will replace Buccaneer’s small interest in the project with needed cash assets. Fort Worth, Texas-based BlueCrest Energy already owned the other 75% and will now control the project in its entirety.
At the heart of the Cosmo unit is the Endeavour jack-up rig. As part of the deal, BlueCrest Energy is on the hook to keep using the rig for another 150 days, to be spit up in 50 day increments during winter drilling seasons. Those seasons run from November through April. The Endeavour is currently in Port Graham awaiting approval to get back to work.
Related to that sale is Buccaneer’s offloading of half its interest in Kenai Offshore Ventures. That’s the partnership between Buccaneer, a Singapore-based investment firm called Ezion Holdings and Alaska taxpayers, who helped fund the purchase of the rig through the Alaska Industrial Development and Export Authority.
Buccaneer’s share of the venture will go to a subsidiary of the Singapore outfit for $24 million. Buccaneer officials again did not return calls for comment about the sales, but according to the news release, the goal of that sale is to jettison its ownership of the rig, but still use it for drilling operations. A call to the Alaska Industrial Development and Export Authority for comment wasn’t returned in time for this story.
Finally, Buccaneer has found itself another fresh injection of capital to continue with other projects. A short-term, $6 million loan was made available by Chicago investment firm Meridian Capital. Meridian also extended a $50 million line of credit to Buccaneer. That’s in addition to the $100 million Meridian put up back in July.
During the two-plus years Buccaneer has been working around Cook Inlet, its only production to market has come from the Kenai Loop wells, putting out close to five billion cubic feet of natural gas since coming online. Those operations could be in jeopardy, too, though. Court hearings are scheduled for later this month to settle ownership disputes about the wells between Buccaneer, Cook Inlet Region, Incorporated and the Alaska Mental Health Trust.