|
Devlan Exploration to drill rare summer well Junior E&P gives impetus to search for oil in the central Mackenzie Valley Gary Park Petroleum News Calgary Correspondent
Devlan Exploration, a Canadian-based junior oil and gas producer, is joining the hunt for oil in the central Mackenzie Valley of the Northwest Territories. With the exception of the wells Imperial Oil has drilled on the manmade island near Norman Wells, it will be the first summer drilling in the region for many years.
Having received National Energy Board approval, Devlan is ready to proceed with drilling in the Grandview Hill area, 165 miles northwest of Norman Wells. It is expected to take one month to reach total depth of 2,600 feet on its wholly-owned Exploration License 413.
The company said Aug. 19 that equipment and rig hands are moving to the site, about 560 yards from the banks of the Mackenzie River. The equipment includes an Akita/Sahtu Drilling rig, which has been carried by barge. The first barge arrived Aug. 23, Akita/Sahtu Senior Vice President Rob Hunt told Petroleum News. Plastic mat road used “They were able to drill in the summer because they’re using a board road” from the barge landing to the drill site, Hunt said. The road is approximately 300 kilometers in length.
The mats, he said, were first used in the swamps in Louisiana and brought into Canada about eight years ago.
“There are a lot of environmental issues” in the area, demanding “zero ground disturbance,” he said.
The mats are made from “a unique, very strong plastic; they’re interlocking and very light.” Wood mats, Hunt said, tend to absorb water, and “become very heavy and thus expensive to move around.”
Once the well is completed, the land tenure requirements for the 201,160 acre license will be fulfilled until 2009.
Devlan said it will then be able to take a measured approach to its future exploration spending and also take advantage of the Mackenzie Valley natural gas pipeline, which is targeted for completion before 2010.
The Arctic pipeline proposal is expected to include a second line to carry liquids from the Mackenzie Delta to Norman Wells, where it would feed into the under-utilized Enbridge pipeline from a long-established oil field to northern Alberta. Looking at deeper targets Devlan said that in addition to the shallow target for its Devlan Moose Lake D-07 well it has been examining the deeper potential underlying the exploration license.
For the second quarter, Devlan reported net earnings of C$1.66 million, down 11 percent from the year earlier, although production was up 12 percent to an average 2,713 barrels of oil equivalent per day.
Heavy oil is making a stronger contribution, with output of 378 bpd in the three months, based largely on drilling success from 11 wells in Saskatchewan.
The junior’s net debt dropped to C$20 million by June 30, with company President Martin Cheyne noting that the “improved balance sheet will enable us to pursue both our Alberta and Northwest Territories drilling prospects this summer.” Speculation of Northrock discovery, EnCana dry hole Meanwhile, results are being eagerly awaited from an oil-targeted well drilled last winter by Northrock Resources, a subsidiary of Unocal. The well was drilled to almost 10,000 feet about 50 miles south of Norman Wells.
Speculation of a discovery has intensified in recent weeks, but there has been no confirmation from Northrock, or its partners Husky Energy, EOG Resources Canada, Pacific Rodera or International Frontier Resources.
EnCana also completed an oil exploration well in the central Mackenzie in February, but has yet to answer reports that it was a dry hole.
| 