Minister of Environment and Energy Jamie Ballem has announced the successful companies in the Call for Bids for oil and natural gas exploration rights on four Island properties.
Rally Energy Corporation of Calgary, Alberta, was top bidder for two parcels that encompass a total of 125,000 hectares (308,000 acres). The properties include the Irishtown and Seaview exploratory wells. Before the previous exploration permits expired, Rally drilled these wells and invested in seismic surveys and an air-borne exploratory program on these lands. In addition to its PEI holdings, Rally Energy Corporation has international exploration interests which include producing oil properties in Egypt.
Corridor Resources Inc., based in Halifax, Nova Scotia, secured the remaining two parcels that total 107,000 hectares (264,000 acres) and include lands in the central parts of the province and eastern Prince County. Operator of a producing natural gas field near Sussex, New Brunswick, Corridor previously conducted exploration in Prince Edward Island that culminated in the drilling of the Green Gables # 2 well near Cavendish in 1997. Corridor also has other exploration holdings in Eastern Canada. Minister Ballem issued the Call For Bids on the four parcels of land June 30. The results bring the total holdings of the province’s exploration permits to over 400,000 hectares or more than one million acres. Other permit holders are BP Canada Energy Company and Petroworth Resources Inc.
“Prince Edward Island continues to attract considerable interest as an exploration target, with this Call for Bids generating interest from several major and junior exploration companies,” said Minister Ballem. “This is an under-explored region, but with the trend toward increased expenditures by our permit holders, there is renewed optimism that commercial resources of hydrocarbons will be found.”
Under the province’s Oil and Natural Gas Act, the process of issuing an oil and natural gas permit starts with the Minister receiving a written request that lands be submitted in a Call for Bids. Bid packages are made available to prospective bidders which describe the area up for bid, criteria for selection and terms and conditions that must be met by the bidder. As part of the process, bidders must submit a work plan and post a performance bond that represents one quarter of the value of the work that is to be carried out during the six-year term of the permit.
The issuance of an oil and gas permit does not transfer property rights to the successful bidder. Access to or over private property must be negotiated with the property owner.