Optimism is growing scarce in Nova Scotia’s offshore, with the only two exploration wells scheduled for 2005 both in doubt.
Calgary-based startup Marauder Resources East Coast has scrapped its efforts to take a 35 percent interest in an EnCana well and Canadian Superior Energy has stalled its planned well from this spring to at least late fall while it hunts for joint-venture partners.
But neither operator is ready to abandon their 2005 plans.
Marauder gave up on a two-month effort to raise C$26 million for the EnCana wildcat that was expected to start drilling by the end of September.
“Given current market conditions, the company and its agents, Dundee Securities, have concluded that the company is unable to complete the financing at this time,” Marauder said in a statement.
“We have advised the operator (EnCana) that we will not be proceeding with the Grand Pre farm in” — a shallow water well that was expected to cost up to US$25 million in an effort to find new gas reserves and bolster the economics of EnCana’s stalled Deep Panuke project.
Marauder President Bob Shields says EnCana wanted his company’s money upfront, but potential investors insisted they wanted EnCana to first secure a drilling rig.
EnCana, disappointed that its immediate plans to test Deep Panuke’s geology have been lost, is unsure what its next moves will be for the 1998 discovery, estimated at 935 billion cubic feet.
EnCana will continue to look for partner
However, EnCana spokesman Alan Boras told Petroleum News that it remains the big independent’s intention to continue looking for a Grand Pre partner while it considers expressions of interest from rig contractors.
He said there is still time to get the pieces together for a 2005 well.
Deep Panuke was put on hold more than two years ago, while EnCana explored several options, including taking on a junior partner and discussing ways to share infrastructure with owners of Nova Scotia’s Sable field.
Before Marauder surfaced just before Christmas 2004, EnCana Chief Executive Officer Gwyn Morgan mused last November that Deep Panuke could be offered for sale unless ways could be found to develop the assets “economically and profitably.”
For now, EnCana has not set a “drop dead date” for Deep Panuke and continues to look for assurances about the life of the field’s reserves and what it can economically be expected to produce.
Amid a large-scale pullback from Nova Scotia by major operators, who allowed 22 exploration licenses to lapse last year, activity in the region has almost ground to a halt.
Canadian Superior had also planned well
Canadian Superior said May 16 that the well it had originally planned to spud on its Mariner Block this spring has been postponed to late fall at the earliest while it tries to arrange partners and a rig.
It said that “due to 2005 cost considerations and capital budgeting requirements” its operations in Trinidad and Tobago will get priority over Nova Scotia.
However, the Calgary-based junior said it is continuing to work on future drilling prospects for its Mariner, Marquis and Mayflower projects.
It has identified five deepwater prospects on the Mayflower block, about 285 miles east of Boston, and hopes to advance a seismic program to better define drilling targets.
Canadian Superior said it has also identified several prospects on its Marauder and Marconi exploration lands covering 371,000 acres.
