Saskatchewan-based junior producers show substantial interest in April land sale
By Brian Zinchuk
REGINA – The Government of Saskatchewan’s Crown petroleum and natural gas public offering, held on Tuesday, April 2, 2024, has raised $15,454,748 in revenue for the province, with the Estevan area generating the most cashflow. The sale showed notable interest in southeast Saskatchewan from several Saskatchewan headquartered oil producers who provided much of the activity in this sale.
Of the 147 parcels posted for this sale, 123 parcels received acceptable bids, which covered 16,065 hectares. Six parcels received bids that were rejected as unacceptable after a technical review, and no bids were submitted for the remaining 18 parcels.
Aldon Oils, shown drilling near Lampman in September, 2023, was quite active in the April land sale. The rig is Betts Drilling Rig 2. Photo by Brian Zinchuk
Southeast Saskatchewan brought in the most revenue, $13,795,439 for 84 leases and two exploration licenses covering 9,797 hectares. The two exploration licenses brought in $3,123,533 between then, at an average of $1,493 per hectare. The two exploration licenses in this offering were awarded to Crescent Point Energy Corp. One license totalling 1,416 hectares received a bid of $2,114,417, or $1,493 per hectare. The second license totalling 676 hectares received a bid of $1,009,117, also $1,493 per hectare. These exploration licenses are located in the Estevan area, northeast of Lampman, and are prospective for oil in the Bakken Formation.
In southeast Saskatchewan, these oil companies were successful in bids under their own names: Anova Resources Inc., Caprice Resources Ltd., Aldon Oils Ltd., Elk Run Resources Ltd., Hummingbird Energy Inc., Baserado Resources Ltd., Crescent Point Energy Corp., Midale Petroleums Ltd. and Buffalo Hill Resources Ltd. The remainder were under land agent names.
Hummingbird Energy Inc. made the highest bonus bid and highest dollars-per-hectare bid in this offering, putting up $2,200,000 for a 194-hectare lease prospective for oil in the Frobisher Beds in the Estevan area, northeast of Midale. The bid works out to $11,357 per hectare.
Following that, the Lloydminster area or northwest Saskatchewan brought in $1,425,234, generated from bids on 32 leases totalling 4,842 hectares. A total of 45 leases had been posted, and no exploration licenses.
Synergy Land Services Ltd. bid $408,367, or an average of $5,046 per hectare, for a lease located 10 kilometres west of Paradise Hill near the Tangleflags North Oil Pool. This is the highest bonus bid and highest dollars per hectare received on a parcel in the Lloydminster area. This 81 hectare lease is prospective for heavy oil in the Mannville Group.
Meanwhile bids in the west central Saskatchewan generated $234,075 in revenue. The highest bonus bid and highest dollars per hectare received on a lease in this area is $136,125, an average of $526 per hectare. This 259 hectare lease was awarded to Synergy Land Services Ltd. This lease is located 11 kilometres northeast of Dodsland and 7 kilometres west of the Kelfield Mannville Sand Oil Pool.
No parcels were posted in southwest Saskatchewan.
In western Saskatchewan, Cenovus Energy Inc. Canadian Natural Resources Limited, Scout Energy Ltd., Metropolitan Resources Inc. and Baytex Energy Ltd. were the companies who acquired Crown land under their own name, with the rest of the bids coming from land agents.
This is the first of six scheduled public offerings this fiscal year. The first oil and gas public offering last fiscal year generated $11,113,460 in revenue.