Purcell, Anadarko in J-V agreement

Gary Park

Petroleum News Calgary Correspondent

Two of the most active E&P companies in northern Canada have reached a joint venture agreement covering 33,000 gross acres of natural gas prospects in northeastern British Columbia. Purcell Energy announced Nov. 24 that a farmout and joint venture has been reached with Anadarko Canada at Tenaka that will limit Purcell’s initial capital costs to about 30 percent for three-dimensional seismic and 25 percent of the first well in the area, while retaining an average 36 percent working interest in most of the land block.The two companies have acquired some lands jointly and pooled others for the joint venture which is southwest of Anadarko’s Adsett Slave Point gas pools that are currently producing a gross 50 million cubic feet per day.

Purcell and Anadarko also formed a joint venture last year on a block of lands directly north of their new venture, which will involve a 3-D seismic program over 42,000 square miles this winter. Under the agreement, gas produced from the J-V lands will be processed through Anadarko’s existing Adsett infrastructure.

Purcell and Anadarko have committed to drill three Slave Point prospects on a 31,000 square miles 3-D seismic program shot last winter. Tie-in of any successful wells is scheduled for the second quarter of 2004. Purcell chief operating officer Bruce Murray said the area “holds great promise and exposes Purcell to potentially large gas reserves.”

He said Purcell began buying land at Tenaka three years ago and has now accumulated interests in about 52,000 gross acres which could keep the company “busy for several years.”