The Canada-Nova Scotia Offshore Petroleum Board has issued a call for bids on 20 exploration licenses off Nova Scotia. The licenses cover about 2.2 million hectares (see map [119,820 bytes]).
The minimum bid for each block is set at $1 million (Canadian). The blocks will be awarded based exclusively on the amount of capital to be spent during an initial license period of 5 years.
If the bid winners post a $250,000 deposit toward the drilling of a well before the conclusion of the fifth year, the license will be extended to a sixth year. If a well is drilled by the end of the sixth year, the license term will be extended another 3 years.
The board also detailed allowable expenditures, including overhead, of $450,000/day for a jack up rig and $600,000/day for a semisubmersible rig or drillship.
Seismic costs are subject to board approval.
The board will not permit drilling from the surface of Sable Island or within 1 nautical mile seaward of the low water mark of the island (on Blocks 4 and 5).
If a discovery is made on these blocks and a plan for development ensues, the plan must include a comprehensive program for detecting, preventing, and mitigating subsidence.
The deadline for bids is Apr. 29, 1999.
Copyright 1998 Oil & Gas Journal. All Rights Reserved.
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