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Talisman discovery opens new B.C. natural gas play in foothills
Backed by three decades of experience in a challenging natural gas region of northeastern British Columbia, Talisman Energy has extended its reach into what Chief Executive Officer Jim Buckee rates as a “new high potential area.”
With Husky Energy as a 50 percent partner, Talisman said March 13 it has made a major discovery with only its second exploration well in the foothills area about 60 miles north of its well-established Monkman operations.
Tested at restricted flow rates of 21 million to 25 million cubic feet per day, the Federal d-28-h/94-B7 well is capable of producing in excess of 40 million cubic feet per day, but will start producing in November at half those volumes due to facility limitations.
It follows a discovery last fall that Talisman described as one of the “best-ever” in the Alberta foothills. Restricted tests from that well yielded gas flows of 14 million cubic feet per day, but the company estimated that with the wellhead wide open the potential flow rate was 94 million cubic feet per day.
The Federal well was drilled to a depth of 10,000 feet at a cost of C$15 million, compared with the average C$25 million at Monkman, Talisman spokesman Barry Nelson told Petroleum News.
He said the discovery is significant because of both its size and the fact it was found in a different, shallower formation from the deep Monkman gas.
Nelson said Talisman is targeting structures of 30 billion to 200 billion cubic feet.
New area shares characteristics The new area shares some of Monkman’s characteristics of a thrust and fold belt that creates a fracture zone that presents some drilling challenges.
But Talisman’s history, including that of its predecessor company BP Canada, has been one of trail-blazing since the 1970s as an explorer and producer in the foothills region straddling the northern British Columbia and Alberta border.
Monkman currently contributes about 110 million cubic feet per day of Talisman’s North American output of 900 million cubic feet per day, although output is limited by capacity at Duke Energy’s McMahon gas plant. Efforts to overcome that problem are under way.
For 2007, Talisman has a budget of C$450 million for the foothills and another C$100 million for Monkman, despite applying the brakes last year to its upstream because of high costs and uncertainty over the near-term future of gas prices.
Talisman said it has identified two 100 percent opportunities on the new structure which it expects to pursue in 2007 and 2008. Along with Husky it has about 25,000 acres in the region.
Others who are active in the region include Anadarko, Petro-Canada and ConocoPhillips Canada.
Steve Hager, exploration analyst with Canadian Discovery, told the Calgary Herald Talisman has opened up a “whole new area” by applying the exploration techniques it has sharpened in the Monkman play.
—Gary Park
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