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Claims of giant gas basin in Canada BP, NWT, Yukon, NEB estimate Liard basin has 219 trillion cubic feet of marketable gas, but have no plans for early development GARY PARK For Petroleum News
The Northwest Territories, Yukon Territory and British Columbia are taking a massive deposit to the bank that reinforces Canada’s status as a nation rich in natural gas resources.
A joint assessment over three years by regulatory agencies of the three jurisdictions and Canada’s National Energy Board has estimated that the Liard basin holds 219 trillion cubic feet of marketable, unconventional natural gas, making it the second largest deposit behind the 449 tcf in the Montney formation in northeastern British Columbia and northwestern Alberta.
The release of the findings lifts the curtain on years of speculation over the volume of gas in the basin, which Apache disclosed in 2012 gave it the “most prolific shale gas resource test in the world” from a well drilled in 2009 on Liard land in British Columbia.
The company said the basin situated about 90 miles northwest of Fort Nelson stands to be the “best unconventional gas reservoir in North America.”
Single well at 21 mmcf per day The single well produced 21 million cubic feet per day during its first month after being fractured six times, but analysts cautioned at the time against placing too much stock on numbers generated from relatively scant data.
Apache estimated wells in the Liard could be profitable at a well-head price of US$2.57 per thousand cubic feet.
“It’s the most exciting thing I’ve ever worked on,” said Robert Spitzer, the company’s Canadian vice president of exploration at the time, who has spent 31 years engaged in exploration.
Apache has drilled four wells on the Liard and examined logs from 16 others drilled since the 1960s, and produced gas into an existing pipeline running south from the NWT.
Several analysts cautioned that many more wells would be needed to firm up Apache’s high-flying estimates.
Canada used 3.2 tcf of gas in 2014, making the Liard unconventional gas resource equivalent to more than 68 years of consumption at that level.
It is estimated to have more than 850 tcf of remaining marketable gas in areas already served by major pipeline systems, representing 267 years of supply based on the 2014 consumption rate.
NWT portion 44 tcf The NWT government noted that its portion alone of 44 tcf is equivalent to 14 years of Canada’s 2014 consumption.
NWT Premier Bob McLeod said the assessment “confirms the magnitude of the resource potential we thought to exist in this region,” adding that development of natural resources is vital to the NWT’s economy.
“We are committed to pursuing responsible stewardship of these resources through our land and resource management programs,” he said.
While unable to speculate on a timetable for development of the resource, McLeod told Petroleum News that the gas, because of its location, would be an ideal feeder for LNG exports from British Columbia.
NEB Chair Peter Watson said the study establishes that Canada “has a very large natural gas resource base at its disposal and Canadians will be well supplied with gas for as long as they need it.”
He said the study will also enable all of the governments to be “better informed when building policy around resource development and energy markets.”
Yukon Energy, Mines and Resources Minister Scott Kent said the assessment helps fulfill his government’s commitment to build its knowledge and understanding of the Yukon’s shale gas potential.
“With a limited land base available for oil and gas development, this assessment demonstrates the enormous energy potential of the southeast Yukon,” he said.
Land-management plan signed The Yukon put another vital piece in its resource development hopes in place two months ago when a First Nations group signed a land-management plan with the territorial government.
Kaska Dena, whose several communities span the border between northern British Columbia and the Yukon, said the pact lays out the sharing of responsibilities, benefits and decision-making powers for resource development on traditional lands.
Liard Chief Daniel Morris said the Kaska lands are among the richest in the Yukon, suggesting the agreement is good news for industry because it provides certainty around resource extraction.
Yukon Premier Darrell Pasloski said the pact is a milestone towards reconciliation and a renewed relationship between his government and the Kaska.
British Columbia’s Natural Gas Development Minister Rich Coleman said the findings mean the potential amount of gas available for export from his province has “increased substantially” by demonstrating to prospective LNG customers “just how much gas is available.
“This certainly makes our province an attractive location for investors which means long-term economic activity and jobs for British Columbians for years to come,” he said, without making any comment on when commercial exports of LNG might be possible.
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