Oil & Gas Rights Sales Net $20 Million in Bonus Bids

By 250 News

The November 2009 land rights sale resulted in nearly $20 million in bonus bids, bringing the calendar year-to-date total to $720.6 million.

The November 18 sale offered 44 parcels in northeast B.C. covering 21,333 hectares and sold 31 parcels covering 17,645 hectares. The average price per hectare was $1,130.

The key parcels in the sale included:

• One drilling licence in the southern portion of the Horn River Basin, about 15 km north of Fort Nelson, totaling more than $6.4 million, with a per hectare bid of about $4,066
• Two leases in the eastern portion of the Horn River Basin, approximately 75 km northeast of Fort Nelson. Bids of between more than $2,120 to more than $3,500 per hectare totaled nearly $1.5 million.
• Three leases in the Montney area, north of Dawson Creek, with bids between $5,308 and $8,662 per hectare for a total of more than $5.4 million.

Drilling licences provide the exclusive right to explore for natural gas by drilling wells. They are acquired by the successful bidder at the Crown sale and primary terms are three, four or five years, depending on location.

Leases provide the exclusive right to produce petroleum and natural gas and are acquired by the successful bidder at the Crown sale or selected from permits and drilling licences. Primary terms are five or ten years, depending on location.

The next sales is scheduled for December 16, 2009 and will offer 102 parcels covering 85,070 hectares.

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