Murphy chases B.C. gas prospect

Murphy Oil has emerged as the leading bidder in British Columbia’s last land auction of 2007, spending almost C$225 million for rights to three parcels in the a tight-sand resource play near Dawson Creek.

Murphy Chief Executive Officer Claiborne Deming told a conference call the acquisition adds to acreage acquired earlier in 2007 in the emerging Montney play.

He said his company now holds 80,000 acres it believes has the potential to yield more than 2 trillion cubic feet of natural gas. Murphy said initial production from the new core area is expected in the final quarter of 2008.

The company, which produces 44,000 barrels of oil equivalent per day in Canada, despite recently unloading some Western Canadian assets, made its most notable discovery in the Ladyfern gas field in the 1990s, but that field has almost been depleted.

It views the Montney play as a low-risk opportunity to achieve growth.

—Gary Park