Exploration is slowly returning to the arctic waters of the Beaufort Sea, offshore both the Northwest Territories and Alaska. On the Canadian side of the Beaufort, Devon Energy Corp. is planning to drill an offshore well during an upcoming winter season, most likely 2005-06, says Michel Scott, Devon Canada vice president, frontiers. "Right now we are finessing our prospects, conducting internal peer reviews and working on scoping economics and engineering design." During the past two summer seasons, Devon acquired 1,800 square kilometers of 3-D seismic data across its 840,000-acre Exploration License 420. A well, if Devon decides to proceed, is expected to cost in the range of $50 million. The company is also looking for a partner or two to spread the risk of the exploratory venture. Devon notes that the Canadian portion of the Beaufort Sea has considerable remaining potential, and a number of prospects could contain recoverable reserves in excess of 1 trillion cubic feet (Tcf) of gas. To date, about 80 wells have been drilled and several significant fields have been found. The largest is Amauligak, which was discovered in 1984 and holds 1.3 Tcf of gas and 350 million barrels of oil. Limited quantities of oil were shipped from Amauligak to the Far East by Gulf Canada Resources during the late 1980s, but the field is not currently producing. ConocoPhillips, the new operator, says the field will be an anchor for any future development in the area. Across the border in the U.S., a recent sale of federal leases in the Beaufort Sea drew $8.9 million in high bids. Sale 186, the first conducted offshore Alaska's North Slope since 1998, caught the interest of three firms-ConocoPhillips, EnCana Corp. and Denver-based independent Armstrong Oil & Gas. The companies had a narrow focus, however, bidding on just 34 of the 1,798 blocks that were available. The most sought-after area was in the expired Sandpiper Unit, north of BP's Northstar Field, which is currently the only production developed in the Beaufort's U.S. waters. ConocoPhillips offered $2.1 million for Beachy Point Block 6456, the highest bid in the sale. It also picked up neighboring Block 6459 for $1.2 million, and Block 6408 for $646,800. The Sandpiper prospect was first drilled in the mid-1980s by Shell; Amoco later took over operations on a second well on the project. Both found oil and gas, but the partners decided not to develop the discovery and relinquished the leases in 2001. The majority of the blocks in Sale 170 were taken by Calgary-based EnCana Corp., which spent a total of $3.5 million on 24 tracts. The firm is experienced in the area, as it operated the most recent Beaufort Sea probe. Its #1 McCovey was drilled last winter in a joint state-federal unit in 35 feet of water, some 12 miles east of Northstar Field. Although that test was plugged and abandoned, it did not dampen EnCana's interest in the Beaufort. The company concentrated its buying in the Dease Inlet area, north of the National Petroleum Reserve-Alaska. There, it picked up 19 blocks comprising some 100,000 acres. No wells have been drilled in the immediate area, although there are a handful of active leases held by other firms. EnCana also took a few licenses on the eastern side of the sale area, offshore Badami and Endicott fields. Denver-based independent Armstrong dedicated $1.3 million at the sale. It picked up Beachy Point blocks 6352 and 6402, north of the onshore Kuparuk River Unit. In the Harrison Bay area to the west, Armstrong won five additional blocks. These lie in the same area where the company has been actively prospecting with its Dallas-based partner, Pioneer Natural Resources. Last winter, the pair drilled the #1 Ivik, #1 Oooguruk and the #1 Natchiq on the Oooguruk Unit, on state acreage. Although the wells found only thin sands in the Cretaceous Kuparuk, the primary objective, they did encounter thick, oil-bearing sandstones in the Jurassic. Pioneer, the operator, reported that one of the wells flowed 1,300 barrels of oil per day; it is currently evaluating the commercial potential of the discovery. Clearly, as Canada's Mackenzie Valley Pipeline project moves steadily ahead, and the talk of enabling an Alaskan gas line swirls in Congress, explorers are looking once again at the rich resources of the continent's northern regions.