The estimates of natural gas resources to support the C$7 billion Mackenzie Gas Project are as wide and varied as the terrain they cover.
To date, proven reserves in the three anchor fields on the Mackenzie Delta have been calculated at up to 5.7 trillion cubic feet by the owners and 4 tcf by the National Energy Board.
But the Mackenzie pipeline could draw over time from four plays — the Delta, Beaufort Sea, Colville Hills in the Central Mackenzie Valley and Eagle Plains in the Yukon.
A study by consulting firm Gilbert Laustsen Jung Associates that accompanies the Mackenzie regulatory filings puts the resource size for the four plays at 23.9 tcf-47 tcf original gas in place which was narrowed down to a “best estimate” of 34.8 tcf.
Available prospective sales gas for the Mackenzie project from the four plays is projected at 9.53 tcf.
The consultant said 18 fields containing non-associated gas have been discovered in the onshore Delta.
Three anchor fields
The three anchor fields have 8.273 tcf of original gas in place, of which 5.69 tcf is deemed recoverable marketable gas, while the 14 remaining fields have 1.647 tcf original gas in place, of which 1.09 tcf is recoverable.
Colville Hills, 60 miles from the Mackenzie Valley pipeline route and the target of an active drilling program, has 869 billion cubic feet original gas in place, with 380 bcf listed as recoverable.
Eagle Plains is 180 miles from the pipeline route, making it uneconomic to tie in on a stand-alone basis, the consultant said.Currently, original gas in place is 144 bcf, with 80.4 bcf considered recoverable, but the area “may become more economic as additional pools are discovered.”
The Beaufort Sea has posted 16 discoveries in water depths of less than 100 feet, with original gas in place at 4.84 tcf and recoverable gas at 3.47 tcf.
Also large volumes of potential, undiscovered gas
The study estimated undiscovered original gas in place at 6.99 tcf (of which 4.6 tcf is seen as recoverable sales gas) in the Delta, 8.39 tcf (5.52 tcf recoverable) in the Beaufort, 5.67 tcf (2.48 tcf recoverable) in Colville Hills and 610 bcf (400 bcf recoverable) in Eagle Plains.
Gilbert Laustsen Jung calculated average per well exploration costs and depths at: Delta, C$24-$26 million, 7,872-9184 feet; Beaufort C$60 million, 9,840 feet; and Colville Hills C$5.6 million, 4,592 feet.
Finding costs per thousand cubic feet ranged from C70 cents to C$1.20 in the Delta, C70 cents in the Beaufort and C50 cents in Colville Hills.
Minimum capital commitments of C$664 million are attached to 15 exploration licenses granted for the onshore/offshore Delta, with the majority of primary terms set to expire in August 2005, while Colville Hills has three exploration licenses carrying work commitments of C$36.7 million and due to expire in September 2005.
The consultant noted that the proposed Mackenzie pipeline could be expanded from its initial 1.2 billion cubic feet per day to 1.8 bcf if there was accelerated exploration and development in the Beaufort.
The report said the Issungnak and Amauligak fields, two Beaufort discoveries from the 1980s, could be brought on stream as early as five to six years after development of the anchor fields.
