Copyright of the Daily Oil Bulletin 2018
British Columbia’s First Land Sale Of 2018 Draws $12.83 Million
The British Columbia government started the year with a decent land sale haul.
At its first sale of 2018 held this week, the province attracted $12.83 million on the sale of 39,005 hectares at an average price of $328.95. Land buying appeared to be driven by interest in the Montney, similar to last year, which fueled a recovery at Crown land sales after two abysmal years (DOB, Jan. 3, 2018).
Full results of the January 2018 land sale are available on the DOB reports section here.
Two parcels at this week’s sale cracked the million-dollar mark. Plunkett Resources Ltd. paid the top price at the auction, acquiring a 4,414-hecare licence for $2.23 million. The broker paid an average of $505.78. Details of the parcel are in the chart below.
Also this week, Windfall Resources Ltd. paid $1.51 million (average of $410.87) for a 3,680 licence in northeast B.C. Details of the parcel are below.
Most of the parcels posted in the sale are within or flanking the boundaries of the Montney play fairways, and it’s likely that most or all of the higher bids for those parcels where Montney rights were included were driven by the Montney, noted Brad Hayes, president of Petrel Robertson Consulting Ltd.
“That said, while many of the larger postings sold for $100-$800/ha, a few attracted no bids, indicating a range of interest probably driven at least in part by projected liquids content in the Montney,” he said.
However, all the lease postings (one-two drilling spacing units) except 66649 and 66652 were posted for shallow rights, generally only to the base of the Cadomin-Dunlevy-Nikanassin — so not including Montney rights.
“Results here were polarized as well – either no bid or [greater than] $500 — suggesting some very specific shallow targets,” Hayes said.
Drilling licences 66629–38, 66641 and 66649 accounted for most of the total bonus brought in at the Jan. 17 sale, noted Michele Innes, exploration analyst with Canadian Discovery Ltd. The parcels are clustered in the Cache Creek and Flat Rock areas, which lie to the north of the main Montney production trend. However, this area should be prone to light oil in the Montney, and Leucrotta Exploration Inc., Kelt Exploration Ltd., and Primavera Resources Corp. are active in the vicinity.