Shell Canada is being awarded multiple exploration licences for offshore Nova Scotia, after coming out on top in a recent land sale by the Canada-Nova Scotia Offshore Petroleum Board (CNSOPB).
The company successfully bid on four land parcels, offering to spend $970 million on exploration work within the next six years.
It is the highest amount received to date by the CNSOPB for exploration of land off Nova Scotia.
“The (CNSOPB) will proceed with issuing exploration licences effective March 1, 2012 to Shell Canada Limited for these parcels, pending final ministerial approval by both the federal and provincial governments,” board CEO Stuart Pinks stated in a news release this morning.
As the successful bidder, Shell Canada will now have to deposit a total of 25 per cent of its bids up-front with the Nova Scotia regulator.
The call for bids required any bidder to have experience within the last 10 years of having drilled to in-water depths greater than 800 metres.
“These lands are located offshore Southwest Nova Scotia where recent studies have identified oil potential,” Pinks stated.
Already the Maritimes Energy Association (formerly OTANS) has responded to the announcement of the demonstrated interest in continued oil exploration offshore Nova Scotia.
“As an association representing businesses that provide goods and services to the energy industry, anytime there is progress in one sector is good for our business,” chairman Joe Fitzharris stated in a news release.
“We welcome news that there will be exploration for oil offshore Nova Scotia in the coming years and welcome Shell Canada to the region.”
Executive director of the association, Barbara Pike, tipped her hat to government for encouraging the interest in oil exploration.
“The Nova Scotia government and the Department of Energy should be congratulated for investing in the Play Fairway Analysis that independently showed the super majors there is oil offshore Nova Scotia,” she stated.
According to the CNSOPB, no bids were received on four other parcels of land included in the land sale.
The board is currently accepting nominations for areas to be considered for offer in the next call for bids. That call is expected to be issued in May.
Shell Canada response to CNSOPB call for bids:
Parcel 1 — $1,756,450
Parcel 2 — $303,078,225
Parcel 3 — $235,025,888
Parcel 4 — $430,139,437
Total — $970,000,000