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Purcell has high hopes for NWT, Yukon prospects More than 30 new targets identified over some 160,000 net acres; 11 prospects expected to be drilled by second quarter; also ‘elephant hunting’ with Talisman Energy Gary Park PNA Canadian Correspondent
Purcell Energy Ltd., the Canadian junior E&P that hit the jackpot three years ago with its Fort Liard natural gas discovery, is convinced it has the makings of a world-class play on its hands, sprawling over a vast expanse of the Northwest Territories and Yukon.
Enlarging on earlier indications of an active drilling program for the lower Northwest Territories region in 2003, Purcell President and CEO Jan Alston told an exploration update Nov. 13 that his Calgary-based company has identified more than 30 new targets covering 160,000 net acres.
Purcell figures Fort Liard, where 11 prospects are expected to be drilled by the second quarter of 2003, have unrisked reserve potential of 500 billion cubic feet of gas and 1.5 million barrels of oil — “big stuff for a company our size,” says Alston.
Even more ambitious is a joint “elephant hunting” venture with Talisman Energy Inc., searching 3.2 million acres in the southwest corner of the Northwest Territories and southeast Yukon.
Purcell has a right of participation of 40 percent focussing on deep gas prospects with unrisked reserve potential of about 4 trillion cubic feet to this point.
Companies pressing for more land The two companies completed a two-dimensional seismic program in 2001 consisting of about 100 miles and they are now pressing the federal government for more land postings.
Despite water encroachment into Fort Liard’s M-25 and K-29 wells, Alston said pressure data indicates gas-in-place volumes “considerably higher” than the 206 billion cubic feet that was allotted by Gilbert Laustsen Jung Associates Ltd.
Production so far from the K-29, M-25 and F-25a wells has reached 61.6 billion cubic feet of sales gams and will plans under way to double water handling capacity, K-29 and M-25 should soon be producing at optimum rates of close to 70 million cubic feet per day.
In addition, Purcell is hoping for output from its proposed I-40 development hole of about 40 million cubic feet per day.
He described Purcell’s strategy as a combination of patience and a contrarian approach that combined basic development plays with high-impact exploration focused on deeper multi-zone reservoirs in the Northwest Territories, northeastern Alberta and northwest Alberta.
Alston said Purcell employs a technical team with expertise that is uncommon for a junior company, adding that “we shoot seismic on all our plays.”
With a production target for 2003 of about 5,500 barrels of oil equivalent per day, he said capital spending will be as high as C$40 million compared with C$36 million this year.
Just over half of next year’s production will come from Fort Liard.
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