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Yukon issues new call for bids; eyes fresh area near Whitehorse Attempts to use oil and gas to create investment opportunities run afoul of environmentalists, despite government pledges to respect conservation values Gary Park PNA Canadian Correspondent
In its efforts to stimulate oil and gas exploration, the Yukon government has issued a new call for bids and is weighing the prospect of opening up an area close to Whitehorse at the same time that environmental opposition is building.
The new call, which has a Jan. 31, 2002, deadline, involves about 154,000 acres of Peel Plateau, the first for that region since legislative authority for oil and gas was transferred to the territorial government from the Canadian government in 1998.
It’s also the third call since 1998, with the first two attracting C$20.4 million in work bids in 1999 and $2.89 million in 2000 — all from Anderson Exploration Ltd., which has since been taken over by Devon Energy Corp. for $4.6 billion and renamed Devon Canada Corp.
In the meantime, the government is studying the Whitehorse Trough, which extends north from the Yukon-British Columbia border to Minto Landing, for its next offering of exploration rights.
John Masterson, manager of the Yukon’s oil and gas branch, told a forum in November the government hopes its next land sale in 2002 will include the north end of the trough, one of eight oil and gas basins in the Yukon where the potential is rated at 14.7 trillion cubic feet of gas and 867 million barrels of oil.
He said the trough is a narrow strip that holds an estimated 300 billion cubic feet of gas, or only 6 percent of the territory’s projected reserves.
First Nations claims unsettled However, Economic Development Minister Scott Kent cautioned that the government is still in the early stages of negotiating land claims deals with First Nations in the Whitehorse Trough area and the government practice is to release only areas where settlements have been reached.
The latest call requires a minimum bid of C$1 million, with exploration and development rights issued for 10 years.
Kent, in announcing the call Nov. 22, said the government is “working to ensure a positive investment climate by fulfilling our commitment to conduct regular dispositions of oil and gas rights.”
He said companies investing in the Yukon are assured of “acquiring a supportable land base over many years,” based on a North American desire for more “secure and stable energy supplies.”
Renewable Resources Minister Dale Eftoda said the Yukon is pledged to ensure oil and gas development “occurs in a responsible manner, respecting our conservation and environmental values.”
For Peel Plateau, in the Yukon’s northeast, the concerns involve waterfowl use of wetlands, protection of wilderness tourism values as well as socio-economic concerns such as employment and business opportunities.
Kent said these matters have been outlined in bid packages, which require companies to make a work commitment for subsurface rights to the one parcel.
The successful bidder will get the right to explore for oil and gas over a specific period and to produce and market any discovered gas.
Bid packages are available on-line at www.yukonoilandgas.com or by calling the Oil and Gas Resources Branch at 867-667-3427.
Area used by Porcupine caribou herd But government assurances were not sufficient for the Yukon Conservation Society, the Canadian Parks and Wilderness Society and the Yukon Fish and Wildlife Management Board, which are long-standing opponents of exploration and development in Peel Plateau.
They say the area serves as important wetlands for a variety of waterfowl and provides a vital habitat for peregrine falcons and the Porcupine caribou herd.
A number of wells were drilled on Peel Plateau during the 1960s and 1970s, including one inside the bid area, with no reports of major finds.
To date about 71 wells have been drilled in the Yukon, which the Geological Survey of Canada includes in its assessment of the entire North that it believes holds 25 percent of Canada’s remaining discovered petroleum and 50 percent of its estimated remaining reserve potential.
Total estimated proven plus half probable reserves from the western Northwest Territories and southern Yukon are placed at 15 trillion cubic feet of gas and 1.75 billion barrels of oil in 26 significant discoveries and three producing fields.
Northern Cross (Yukon) Ltd., which holds three significant discovery licenses in Eagle Plain, just west of Peel Plateau, estimates the reserve potential of its basin at 1 trillion cubic feet.
Northern Cross president David Thompson rates the potential as “sufficient to supply a local market,” and possibly large enough to work in conjunction with the development of gas in the Mackenzie Valley of the Northwest Territories.
Before the Devon transaction, Anderson Exploration had given no specific indication of plans for its Eagle Plain holdings which cover about 265,000 acres, making it the Yukon’s largest lease holder.
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