Spending may be slightly depressed in Canada for 2007, relative to 2006, but $22 billion (Can.) will still drill many wells.
Shell
Shell Canada announced aggressive capital expenditure plans of $4 billion in 2007, up nearly 50% from 2006. Nearly $1.1 billion will be spent on exploration and production, including $430 million in the foothills, $470 million on unconventional gas projects, $130 million in frontier areas, and $40 million for predevelopment studies for growth assets.
One of the drilling projects associated with a “growth asset” is a 100-well, cold production program in the Peace River area.
The increased funding can be partly attributed to the announcement by parent company Royal Dutch Shell PLC that it would buy the remaining 22% of its Canadian subsidiary that was publicly owned.
Petro-Canada
On Dec. 15, Petro-Canada announced it would spend $4.1 billion on 2007 capital expenditures, an increase of 15% over 2006 levels.
The company will spend $210 million of its budget for drilling programs at Hibernia, Terra Nova, and White Rose fields off Newfoundland. Petro-Canada has contracted the Henry Goodrich drill rig through April 2007 to drill two development wells and a delineation well at Terra Nova.
The company is waiting for regulatory approval from the Canada-Newfoundland and Labrador Offshore Petroleum Board before formalizing a drilling plan for Hibernia and is studying the potential for expanding White Rose field.
Terra Nova, Hibernia, and White Rose are all in the Jeanne d’Arc basin on the Grand Banks offshore NL. Petro-Canada is lead operator on Terra Nova (33.99%), has a 20% share in Hibernia, and a 27.5% share in White Rose.
EnCana
Calgary-based EnCana Corp. announced on Dec. 15 that it plans to spend $5.9 billion in 2007, a 6% decrease from 2006. The company will focus on expanding natural gas and oil sands production.
In October, EnCana had announced it was scaling back drilling plans for the remainder of 2006 to cope with softer natural gas prices and spiraling costs.
Husky
On Dec. 12, Husky Energy Inc. announced it would spend $3.18 billion in 2007.
John C.S. Lau, president and chief executive officer of Husky, said the “2007 capital expenditure program will focus on Husky’s growth in the oil sands and further exploration and development in the offshore East Coast of Canada, offshore China and Indonesia.”
About 82% ($2.62 billion of the $3.18 billion) will be spent on upstream, including $1.63 billion in western Canada, $210 million on western Canadian exploration, $330 million on oil sands, and $290 million in eastern Canada.
Drilling in western Canada will focus on natural gas in the deep basin and foothills of Alberta and British Columbia.
Oil sands drilling includes $31 million at Caribou Lake for delineation wells and advance engineering and $31 million for resource evaluation wells to further assess the Saleski oil sands lease.
Husky’s east coast drilling budget includes a seventh production well in White Rose oil field and delineation drilling of the O-28 discovery in West Avalon pool, north of White Rose development.