ARCHIVED - Southern Northwest Territories Open to Postings for a Second Year in a Row

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Bulletin
Volume 2, Number 4
September 1995

Call for Nominations Launched

A call for nominations will be launched on September 18, 1995 for lands in the Fort Liard area of the southern Northwest Territories. Interested parties have until November 23, 1995 to submit posting requests. Requested parcels will appear in a call for bids in early December.

The new call for Nominations follows a successful cycle of land nomination and bidding which culminated with the issuance of eight exploration licences in January 1995.

As with the 1995 Central Mackenzie Valley Call for Nominations announced in July of this year (see Vol. 2, No. 3 of the Bulletin),this second call in the Fort Liard area reflects the anticipation of local communities and industry for annual cycles of land issuance wherever possible. The predictable environment cultivated by this approach should assist the planning of land acquisition, exploration programs and other business ventures.

The bid selection criterion remains the total amount of money that the bidder proposes to spend doing exploratory work, as defined in the schedule of allowable expenditures, on the parcel during Period 1 of the term of the exploration licence.

The term of exploration licences issued will be seven years broken into periods of four and three years each. The drilling of a well during period 1 will qualify the licence holder to retain the licence for period 2. No rentals are applied during period 1 of the term; this is when the operator may redeem the 25% work deposit by conducting work or activity on the licence. Rentals are applied during period 2, increasing from $2.50/ha in the fifth year of the licence to $7.50/ha in the seventh year: allowable expenditures in period 2 may be used to offset rentals.

Area of the Call

Although eight exploration licences were issued as a result of the 1994 call in this area, about 75% of lands remain available for nomination. Much of the available land is close to the southern margin of the Call block and adjacent to the BC border at latitude 60o. Prospective areas include the Liard-Celibeta structural zone, where Slave Point and Keg River gas plays in middle Devonian barrier and reef-interior settings interplay with faulting east of Bovie Lake and in the Arrowhead Salient. (described in Gas Resources of the Western Canada Sedimentary Basin by Reinson et al., Geological Survey of Canada, 1993).

Opportunities also exist to acquire exploration licences around the arrowhead B-41 gas discovery, an area with gas shows in several wells. Plays in this area include basal Cretaceous sandstones, subcrop of Mississippian formations, Upper Devonian carbonates, overlying the Middle Devonian Presqu-ile barrier which offers the deepest target.

In the foothills belt, lands remain open between the Pointed Mountain and Kotaneelee gasfields and north of existing licences.

Modification to Posting Procedures

Certain modifications have been made to the procedures and requirements in both the Call for Nominations and the ensuing Call for Bids. These were described in the previous Bulletin for the 1995 Central Mackenzie Valley Call and are intended to increase certainty with regard to bid selection and to ensure that winning bidders can be announced without delay following the closing of the call.

In summary, during the Call for Nominations a Priority of Posting will be established. In the case of overlapping requests the first received will be honoured and the opportunity given to a subsequent overlapping request either to maintain the posting for the non-overlapping sections or to withdraw the request. A second modification to procedures is that posting requests may now be delivered by registered mail, by fax or in person directly to the office of the Northern Oil and Gas Directorate.

At the Call for Bids stage, the requirement for a bid deposit has been dropped. Instead, each bid must be accompanied by a work deposit of 25% of the bid amount. This deposit is refundable in the event of a losing bid and may be in the form of a letter of credit, bank draft, money order or certified cheque. Winning bidders can replace this guarantee, at their own convenience, with an acceptable negotiable financial instrument. With this modification it should become possible to announce sale results the day following the closing of the Call with licences issued shortly thereafter.

Mackenzie Valley Call for Nominations

Just a quick reminder that the closing date for posting requests in the Central Mackenzie Valley is November 9, 1995. The call area includes, for the first time, most of the acreage where the Gwich'in and Sahtu Peoples are surface owners, and where the Crown is owner of the subsurface.

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