Oilpatch History

This month in history—July

FRONTIER STARTS TEST. CORONATION ROYALTIES COMPLETED AS FAIR CRUDE PRODUCER.
WELLS: Crude producing 55; Drilling 20; Resuming drilling 16; Preparing to spud 7; Locations 12, TOTAL JULY 2nd: 110 wells.
BOARD CHAIRMAN HOPES TO HAVE CONSERVATION PROGRAM UNDER WAY BEFORE END OF PRESENT MONTH.
Effective at 8 a.m. August 20th allowable quotas of Turner Valleys pro-rated crude oil wells were increased from 49% to 51% of potential to meet heavy harvest demands. The boost was announced Saturday noon by the Alberta Gas & Oil Conservation Board. It came only a week after quotas had been boosted from 37% to 48%, and increases actual production to about 29,000-barrels per day. The increase was made necessary by the very heavy demands for crude oil and refined products as Western Canada's harvest gets under way. The increase is a temporary measure pending setting of well quotas under a new system, probably within a fortnight.
ALL GAS AND OIL WELLS TO BE PRO-RATED. TURNER VALLEY GAS WASTAGE TO BE HALTED.
Financed by the ANGLO CANADIAN OIL COMPANY and testing a new shallow plains structure, ANGLO CANADIAN-MILK RIVER No. 1 well was scheduled for spudding in during the weekend. The well is located on the Bridge Dome structure in the Milk River area about 13 miles east of Coutts. Location is l.s.d. 10-4-2-13w4.
TO PAY ON OLD BASIS
Wells: Crude Oil Producing (Under quota) 152; Testing production 4; Shallow Oilwells 3; Naphtha wells (Operating) 55; Drilling 22; Located 11; Standing 10; TOTAL: 257.
The odds are that gas long regarded as a relatively worthless byproduct in the production of crude oil, or of little more immediate value then sulphur water when found unaccompanied by oil in Alberta wildcat wells - will in the not distant future rank with coal and oil among the most valuable of the Province's natural resources.
By C. O. Nickle
By C. O. Nickle
The principal problems relating to mining, separation and refining of the famed McMurray Tar Sands of Northern Alberta have been 'licked', at a cost to the Dominion Government of $1,750,000; private capital is taking over; and production of petroleum products on a commercial scale is expected to get underway about the end of this year. The new operations will be undertaken by a re-organized ABASAND OILS LTD, the concern which as a private company expended about $1,000,000 on Tar Sands pioneering prior to 1943, and since that time served as the instrument through which the Dominion Government proceeded with research.
Additional Royalty Payment Distributions from MAY 1945 Production were reported to this reporter today. The following Tabulation shows: May Gross Distribution per 1%. Royalty; the Withholding Tax deducted; and the actual Net Payment; together with the Gross Distributions for recent previous months for comparison:
Jumping pound, Southern Alberta foothills structure which was the scene of a big wet gas discovery last December and is now regarded as the No. 1 prospect for a second major oil and gas field in the foothills, will be developed under a unitization plan first ever to be placed in effect in the dominion of Canada.
By: CARL O. NICKLE, Publisher of the Daily Oil Bulletin & Oil In Canada
Alberta's Oil & Gas Conservation has decided to implement a new proration scheme which is based on reserves and depth factor rather than the present system which is based primarily on the Economic Allowance and Maximum Permissive Rates of the provinces light and medium gravity oil producing pools. The Board's new plan seems to be a middleoftheroad type of scheme, or in other words, one which has taken into consideration the recommendations of both the small and large reserve holders in the province. The new plan will not be fully implemented until May 1st, 1969 but the first steps of the plan will be inaugurated May 1st, 1965. The complete Summary and Details of the New Alberta Proration Plan are carried on the following pages. This summation is taken from the Conservation Board's "Report and Decision on Review of Plan for Proration of Oil to Market Demand in Alberta, which may be obtained from the Board's offices in Calgary, 603 Sixth Avenue South west the cost, of $1.00.
The Shaheen oil refinery plan for Newfoundland was weighed and found wanting, and a new hard look at it was called for, by Carl O. Nickle, publisher of the "Daily Oil Bulletin", on July 6th. Mr. Nickle's comments were made on his weekly-televised show "C. F. C. N. T. V. OIL REPORT"; content of which is solely the responsibility of the commentator. The program is sponsored by The Bank of Montreal, normally sticks to factual comment on developments pertinent to oil, but occasionally presents Mr. Nickle's editorial opinion. The comments on the Shaheen plan (text of which appears below) are in this category.
There are growing overtones of dissent in Western Canada with attitudes and policies of the East, and these were recently brought into sharp focus in an article in "MACLEAN'S", Canada's rational magazine, written by Walter Stewart. The article was reviewed by Carl. O. Nickle, Publisher of the "Daily Oil Bulletin", on his weekly "C.F. C. N.T.V. OIL REPORT", Saturday and Sunday, July 5th and 6th, together with supplementary comments directly related to oil and gas. The telecast is sponsored by The Bank of Montreal. Full text of the latest telecast follows:
PACIFIC SILVER MINES & OILS LTD. has recently acquired a spread of almost 200,000 acres of offshore oil and gas rights in the FOXE BASIN play adjacent to Prince Charles Island and immediately west of Baffin Island. The lands were filed in the name of Western Land Services Co. Ltd., on behalf of Pacific Silver. Applications were filed with Canada's Department of Indian affairs and Northern Development on Thursday, July 3rd, 1969.
TWIN RICHFIELD OILS LTD. has advanced very quickly along 'its planned path of expansion and diversified acquisitions since it was formed by the merger of a public Canadian company and a private Calgary based exploration firm in February of this year. Company officials have indicated their plans are to purchase additional firms to complement current operations, and in line with finances also pursue active exploration and development of presently held and obtainable oil and gas rights.
The ONTARIO PROVINCIAL GOVERNMENT placed a price freeze on gasoline and home heating oils period commencing July 3, 1975. The control prohibits marketers from increasing their selling price presumably at both wholesale and retail level until OCTOBER 1st, 1975. And, PREMIER BILL DAVIS of Ontario in making the Government action known also revealed that a one man Commission will be set up to review refined product prices in the province and make recommendations to the Government. The Provincial action will not be challenged by the Federal Government according to statements made by Energy Minister Donald Macdonald. The price freeze in Canada's largest gasoline consuming province and largest refining region sent shock waves throughout the refining and marketing segments of the industry.
J. A. ARMSTRONG, Chairman of the Board and Chief Executive officer of IMPERIAL OIL LIMITED today stated it is regrettable that the ONTARIO GOVERNMENT has chosen to further extend the petroleum product price freeze from 45 to 90 days. The total delay means that an additional $70 million is available to finance the rising costs of exploration and development at the very time Canada is confronted with energy uncertainty.
Few car drivers across Canada realize that as much as 40 percent of the price they pay for gasoline at the pump goes directly to Governments. And, in Toronto where Imperial Oil Limited suggests that a reasonable average price for its regular gas, bought at a full service station should be about 76 cents per gallon, the Government Tax take is an even 42%. The representative price chart shows regular gas prices at ten cities across Canada.
The following statement was released by the Minister of Energy Mines and Resources at 3:00 p. m. July 16th, 1975:
The NATIONAL ENERGY BOARD'S CANADIAN GAS SUPPLY/REQUIREMENTS REPORT was made public yesterday afternoon by the HON. DONALD MACDONALD, Minister of Energy, Mines and Resources. Although copies are not yet available for general distribution they will be available in Calgary shortly. Meanwhile, the three and one half pages from the report dealing with Board Recommendations is recorded verbatim in this publication for consideration of Bulletin subscribers. Additional details from the report will be recorded in subsequent issues of the "Daily Oil Bulletin".
Since the recommendations for the FOOTHILLS (YUKON) or Alcan Pipeline Project were handed down by the NATIONAL ENERGY BOARD, late Monday, afternoon, the "Daily Oil Bulletin" has contacted and obtained comments from a number of companies that have been most instrumental in developing natural gas reserves in the MacKenzie Delta during this decade. Shortest of comments to date was received from the President of Gulf Oil, coexplorer and developer of the Parson's Lake field. Mr. STOICK, PRESIDENT of Gulf Canada in a telephone interview with a leading eastern Canadian paper commented that "We have to remind ourselves that the recommendation is only a recommendation. The final decision is up to the Cabinet. We have a big investment in that area that will have to remain land locked. and we are very disappointed."
While no official comment is expected to be made by MOBIL OIL CANADA LTD., re its joint venture project with GULF OIL CANADA, in which Mobil is a 25% participant, A. R. NIELSEN, PRESIDENT and GENERAL MANAGER of the firm commented this morning that his company is also extremely disappointed in the uncertainties for Delta gas created now by the National Energy Board's recommendations It is anticipated however, that Mobil and its partner Gulf Oil will await the final decision by the Federal government this fall, before formalizing any definite plans for recommencement or indefinite suspension of drilling activity in the Delta area. As previously reported Gulf Mobil team is currently completing its 1976-77 winter drilling program and will not drill during the winter of 1977-78. During the past several winters the team has been the most active in drilling in the area and its Parson's Lake reserves are estimated in the order of 2.2 to 2.3 trillion cubic feet.
OTTAWA (CP) -- Alberta wants the price of oil to rise to about $37.25 a barrel by Jan. 1, 1984, while the federal government says the price should go only to $27.50 by that date.
Here are details of Ottawa's proposal.
On July 24-25, Prime Minister PIERRE TRUDEAU and Alberta Premier PETER LOUGHEED met in private session in Ottawa, later announced the inability to reach agreement on oil and gas pricing and revenue sharing then publicly stated in brief their positions.
HALIFAX -- Four of the five partners in the Venture Gas Project offshore Nova Scotia, today filed applications with the NATIONAL ENERGY BOARD (NEB) to export an average of 8.5 million cubic metres of gas daily over a 20 year period to the New England Mid Atlantic (NEMA) area of the United States.
OTTAWA (CP) -- The Royal commission which investigated the OCEAN RANGER oil drilling rig disaster has recommended a sweeping overhaul of offshore safety regulations, legislation emergency and search and rescue capabilities, and weather and ice forecasting.