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News archive for January 22, 2014

Oil, gas rights postings draw no response

Industry didn’t express any interest in acquiring oil and gas rights in the Yukon during the last request for postings issued by the Department of Energy, Mines and Resources (EMR).

By Ainslie Cruickshank on January 22, 2014 at 3:20 pm

Industry didn’t express any interest in acquiring oil and gas rights in the Yukon during the last request for postings issued by the Department of Energy, Mines and Resources (EMR).

The request for postings is conducted twice annually as the first step in a two-part process.

If a company expresses interest in a certain area, the government consults with the public and First Nations to decide whether a request for bids should be issued.

The latest request for postings closed Jan. 8.

No interest was expressed during the fall request for postings, which closed in July 2013, either.

The government did receive expressions of interest last January but no bids came in during the second phase of the process.

The last time a company bid on a parcel was in 2010, which resulted in the issuance of one permit to Northern Cross in Eagle Plain.

Ron Sumanik, EMR’s director of oil and gas resources, said Tuesday it isn’t “particularly out of the ordinary” that the government didn’t receive any bids considering the Yukon is a frontier area.

Sumanik said there are several reasons behind the lack of interest, not the least of which are the high cost of doing business in the North, low natural gas prices, and limited infrastructure.

Two of the Yukon’s eight basins are accessible by highway, Sumanik noted, referring to the Eagle Plain and Liard basins.

In the case of the Liard basin, there is also access to a gas conditioning plant and a pipeline to get the product to market, he said.

But the other six basins aren’t close to major roadways.

Only the Liard and Eagle Plain basins were available during the last request for postings, the other six being closed for various reasons.

An interim withdrawal was in place in the Bonnet Plume and Peel Plateau basins during the Peel planning process. But with the release of the government’s Peel plan on Tuesday afternoon, those basins could conceivably be included in the next request for postings.

Sumanik also suggested the interim moratorium on fracking in the territory as the legislature’s select committee exploring hydraulic fracturing conducts its work could also impact the interest.

“At this time, we’ve been very clear what is available is only available for conventional resources,” Sumanik said.

“So if you compare that to other places on the planet where you have other opportunities to pursue both types of resources (conventional and unconventional), that certainly makes them arguably more attractive.”

By Ainslie Cruickshank
Star Reporter

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