Canada reopens High Arctic

Petroleum News

The Canadian government is trying to revive oil and natural gas interest in the High Arctic islands after a lapse of more than four decades in exploration activity.

In a surprise move, the government has invited companies to nominate lands in the Arctic archipelago that could form a future lease auction, while disclosing that the small Bent Horn oil field which yielded 2.8 million barrels in the 1985-96 period is up for grabs.

The next step will hinge on how many, if any, companies select blocks they would like to see become part of a bidding process.

The region is all part of the Nunavut Territory, which attracted drilling in the 1970s when oil prices were high and the federal government offered a bundle of incentives to promote drilling.

The resulting exploration boom resulted in the discovery of 16 fields containing an estimated 300 million barrels of oil and 14 trillion cubic feet of natural gas, but all were too remote to justify the cost of commercial development.

Bent Horn is on Cameron Island, about 1,000 miles from the North Pole. It was the focus of several tanker shipments of crude to Montreal refineries, allowing Petro-Canada to test the economics and the quality of the crude.

But the field was abandoned before Petro-Canada was taken over by Suncor Energy in 2009.

The call for nominations expires on April 24.

—Gary Park