|
BP, Shell chase Atlantic Canada
Gary Park For Petroleum News
BP and, to a much smaller degree, Shell have dug into their war chests to secure offshore exploration rights in Nova Scotia and Newfoundland.
In the annual bidding round by the Canada-Nova Scotia Offshore Petroleum Board, BP landed four blocks covering 14,000 square kilometers for work commitments of C$1.05 billion.
Shell Canada successfully bid C$31.8 million for another four Nova Scotia leases, just two weeks after securing rights covering 13,000 square kilometers in five areas of Newfoundland’s Laurentian sub-basin for C$97 million.
BP said that under the Nova Scotia board’s protocol it will submit a security deposit within 30 days of receiving an exploration license and will submit an exploration plan by the second quarter of 2013.
The company said it is not yet prepared to discuss the number of wells it has in mind.
A spokeswoman said BP has learned a lot of lessons from its 2010 Deepwater Horizon disaster — that has so far cost a record US$4.5 billion settlement with the U.S. government — in the Gulf of Mexico and will bring new procedures and processes to Nova Scotia.
New corporate play BP rated the Nova Scotia blocks as a new corporate play, gaining access to a “significant piece of geology and one of the most promising new deepwater areas to be licensed in recent years.”
The company has not previously drilled in Nova Scotia waters.
The offshore board said the licensing round required bidders on the deepwater parcels to have experience within the past 10 years of drilling exploration wells at water depths of more than 800 meters, adding that both BP and Shell meet those requirements.
Nova Scotia Premier Darrell Dexter was adamant that BP will have to adhere to strict Nova Scotia regulations, which he rated as among the toughest in the world.
Shell now has eight offshore parcels in Nova Scotia after forking over C$970 mi llion in January for four other blocks.
It expects to start seismic testing by mid-2013 or early 2014, with exploratory drilling possible in 2015.
Earlier in November, Shell, as the sole bidder, secured the Laurentian sub-basin properties about 210 miles southwest of St. John’s, Newfoundland, where there is no existing oil or natural gas production.
The company said it has yet to determine whether those blocks contain oil or gas, adding it first needs to complete seismic and other technical work.
The Newfoundland regulator also issued a 2,100 square kilometer exploration parcel in the Flemish Pass in return for a successful bid of C$19.88 million by Husky Oil 40 percent, Suncor Energy 35 percent and Repsol E&P Canada 25 percent.
| 