The successful bid for acreage onshore Alaska (Project Icewine) marks a new chapter for Tangiers Petroleum and a major switch in strategy. Despite the known presence of high-quality source rocks, the North Slope of Alaska is relatively underexplored.
Following significant preparatory work by its partner, Tangiers is hoping to explore for potential in shales and in conventional traps (where wells by neighbours in nearby acreage have been successful).
The play is in its very early stages, though proximate discoveries are encouraging and up to 85% cash rebates from the Alaskan government will be useful. Furthermore, exploration by peers early in 2015 could act as de-risking events for Tangiers before material capital is required. We assign no value to Tangiers at this point but, should the play be proven, can see a path to notable value in time.