Two versions of Ladyfern’s future

Gary Park

Petroleum News Calgary correspondent

Talk of an early death for northern British Columbia’s Ladyfern natural gas field is being downplayed by Apache, while Canadian Natural Resources has written an obituary.

Steve Farris, Apache’s chief executive officer, told a conference call with analysts that the field will “be there for quite a while,” despite a staggering decline from its peak of 665 million cubic feet per day in spring 2002 to under 200 million cubic feet per day.

“In our mind, we think we will continue to see the (decline) curve flatten out,” he said, conceding that holding the line depends on “finding another sweet spot — which is possible.”

Farris said a 100 percent-Apache well drilled in the second quarter is producing 17 million cubic feet per day and several new drilling locations have been identified, requiring decisions by partners Apache and Murphy Oil on which will be drilled first.

Canadian Natural Chief Operating Officer Steve Laut offered a different take Aug. 6 by declaring that the prolific field is being emptied “very quickly,” with his company’s share having plummeted from 210 million cubic feet per day a year ago to 42 million cubic feet per day.

He told a conference call that the Canadian Natural update on Ladyfern could be one of the last.

Following Murphy’s breakthrough find at Ladyfern in 2000, when reserves were initially placed at 750 billion cubic feet, EnCana and Canadian Natural also successfully drilled into the reservoir.

Intense competition among the players saw a rapid depletion of reserves, during a period of low gas prices, and caused some bitterness among those who had invested heavily in infrastructure.

However, Laut fended off accusations of greed, insisting that cooperation “resulted in flows being controlled.”

EnCana CEO Gwyn Morgan also argued that Ladyfern is such a high-permeability reservoir that it faced a short operating life even without competition.