St. Lawrence partners down to third well

Hydro-Quebec, North America’s largest power producer, and junior E&P company Corridor Resources are wavering in their efforts to crack a new oil and gas frontier in the Gulf of St. Lawrence.

The partnership is now left with the last of its three-well program to make a major strike on Anticosti Island, although there is a prospect of further drilling based on the geological data they have gathered.

For now, though, they have fallen short of the optimism expressed by Jennings Capital that the region could hold recoverable resources of 2 billion barrels of oil and 5 trillion cubic feet of gas.

The C$5 million drilling program (with Corridor covering 75 percent and Hydro-Quebec 25 percent) is now left with its Jupiter No. 1 well to test a large structure identified in seismic data gathered by Shell Canada and Encal (now Calpine) in the late 1990s.

Corridor is counting on the 5,600-foot well being completed by the end of September. Of the first two wells, Chaloupe No. 1, drilled to 4,000 feet, was abandoned after encountering oil shows but no reservoir development, while Macdonald No. 1 was drilled to only 2,125 feet, encountering only water.

Corridor said the porous and fractured zones encountered by Macdonald demonstrated “the significant reservoir potential of this zone.”

A study uncovered “very strong indications” of producible hydrocarbons, with the recoverable potential rated at 5.6 million barrels.

Corridor President Norm Miller said the drilling has shown both reservoir development and oil shows, although the two components have not come together in the same well.

If the two companies achieve their objective, they will eventually tie new gas production into the Maritimes & Northeast Pipeline system to the northeastern United States. Corridor, with a 60 percent stake, and Foothills Minerals hold licenses covering 100,000 acres in the Magdalen Islands and plans to drill the Fatima structure which is projected to hold reserves topping 2 tcf.

Meantime, Hydro-Quebec expects to spend a total of C$330 million by 2010 probing Canada’s East Coast as part of its move into fossil fuels.

—Gary Park