Aboriginal leader’s quest

Youthful Liard chief works with government to hold summer Yukon land sale

Gary Park

For Petroleum News

The spluttering attempts to get the Yukon on a solid oil and gas track night get boosted into life by one of the territory’s aboriginal regions, which is promising a land sale this summer.

Liard McMillan, chief of the Liard First Nation, told an Arctic gas symposium in Calgary that his community is committed to “aggressively” leading development in the southeast Yukon.

He said the first nation will “assert its sovereignty and take the lead in oil and gas activities” on traditional lands whether or not it has reached a settlement on outstanding land claims with the Canadian government.

The 28-year-old leader urged business and government leaders to establish ties ahead of resource development with the Liard First Nation, which has established its own development company.

He said the first nation is preparing for a pilot land disposition in the Kotaneelee area, where Devon Canada operates three producing natural gas wells, serviced by a Duke Energy pipeline.

McMillan said the objective is to hold a land sale in the next four months, pending an agreement with the government of Yukon Premier Dennis Fentie, who is prepared to moving forward outside the federal land claims process.

He said the Liard First Nation is willing to seek a level of certainty with the industry, but is determined to see accountability and transparency during development to give assurances to his community’s grassroots members.

McMillan said that means ensuring the spoils of resource development on traditional lands reach the Liard members.

He said the first nation believes it has a legitimate right to portions of royalties that originate with land claimed by the Liard people.

Mixed results at Kotaneelee

The L-38 well which came on stream in May 2005 is flowing at about 16.5 million cubic feet per day with little or no formation of water, according to junior partner Canada Southern Petroleum, which receives a net 3.8 million cubic feet per day.

But declines at the I-48 well and to a lesser extent at the B-38 well mean that volumes from the overall field dropped 29 percent over a four-month period last year.

I-48 fell from June to October from 7.2 million cubic feet per day to 720,000 cubic feet per day.

Canada Southern blamed the problem on liquid loading and said discussions were taking place with operator Devon Canada on potential solutions, but it warned there were no assurances that the decline could be turned around.

However, Canada Southern said in February that 2005 drilling at Kotaneelee and northeast British Columbia contributed to a 39 percent increase in year-end reserves to 2.27 million barrels of oil equivalent.

The company’s proved gas totaled 9.63 billion cubic feet, with a further 3.36 bcf listed as probable reserves, more than doubling the value of both to C$49.9 million.