ARCHIVED - 2003 Central Mackenzie Valley Call for Bids


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Volume 10, Number 1
January 2003

Bids Invited

The Minister of Indian Affairs and Northern Development is inviting bids for petroleum exploration rights on one parcel of land in the Central Mackenzie Valley region of the Northwest Territories. The parcel covers approximately 79 668 hectares of land.

The parcel is identified on the attached map and is formally described in the Call for Bids document using the Frontier Lands Grid System.

The Call for Bids closes at noon Mountain Time, on May 27, 2003.

Terms and Conditions

Terms and conditions of the Call for Bids are described in the official call document, the 2003Central Mackenzie Valley Call for Bids, available at the Frontier Information Office of the National Energy Board at 444-7th Avenue S.W. in Calgary, Alberta and posted on the Northern Oil and Gas Website.

The bid selection criterion remains the total amount of money that the bidder proposes to spend doing exploratory work on the parcel during period 1 of the term of the exploration licence. A deposit of 25% of the bid amount must be submitted with the bid.

The term of an exploration licence issued for the parcel is eight years consisting of two consecutive periods of four years each. The drilling of a well during period 1 of the term qualifies the licence holder to retain the licence for period 2, whether or not the total amount bid has been spent. Any excess bid deposit will be forfeit. A drilling deposit of $1 million may be submitted before the end of the first period to obtain a one-year period of grace to commence the required well. The deposit is refundable on drilling the well.

Calls for Nominations Close

No nominations were received for the Arctic Islands of Nunavut Call for Nominations which closed on January 15, 2003; nor were there any nominations received for the Beaufort Sea/Mackenzie Delta Call which closed on January 7, 2003.

Modification to the administration of Allowable Expenditures

The Allowable Expenditure provisions of exploration licences are necessitated by the work expenditure criterion by which winning bids for exploration lands are selected. These bids represent the total amount of money that the bidder proposes to spend doing exploratory work on the (licence) lands during Period 1 of the term of the exploration licence. The Schedule of Allowable Expenditures attached to each exploration licence describes how the cost of exploratory work of different categories may be claimed and approved. Until 2002, this has generally been through application of set rates applicable to different types of activity.

During 2002, a Task Force comprising the Northern Oil and Gas Directorate (NOGD), and members of the Canadian Association of Petroleum Producers (CAPP) with specific experience and interest in petroleum exploration North of 60, examined ways to improve the administration of allowable expenditures. The consensus of the Task Force was that expenditures should be claimed on the basis of actual cost (the 'at cost' approach) rather than use predetermined rates.

NOGD have moved to the 'at cost' approach for the recent calls for nominations. Guidance Notes have been developed to assist the implementation of the new approach and are available from the Northern Oil and Gas Directorate.

For More Information on Calls for Nominations and/or Bids please contact us:

by phone: (819) 997-0877
or by fax: (819) 953-5828
or via e-mail to the Director:
or via e-mail to Rights Issuance:

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