Zama North A Second Rainbow? Lease Prices At Recent Crown Reserve Sale Suggest Possibility
Today's Front Page Map highlights the recent British American Hudson's Bay oil discovery region north of ZAMA LAKE in northwestern Alberta which is becoming the scene of increased drilling activity and land speculation. With the discovery of reef oil in the Keg River Carbonates at the B. A, H.B. Zama North 16-19-11-64 wildcat industry rapidly diverted a large portion of its attention from the Rainbow Lake play to the Zama Lake region some 50 miles north. Attention was focused on the 8,320 acre drilling reservation and when B.A. Oil picked up this spread for a cash bonus in excess of $2 million a second Rainbow seemed in the making. This became even more evident when Hamilton Brothers purchased C.R. 4191, a 320 acre lease located 3 miles north of the discovery, for $1,362,870 or an average of $4,258, the highest per acre price paid at the July 26th Crown Reserve Sale. Interest in the area was sharply reflected in the stock market quotations with significant jumps in both Dome and Provo shares, major landholders in the immediate area.
Developments have continued at a rapid pace and a review of the front page map shows recent lease selection around the discovery well, the initial offset well drilling on 'tight' hole status, and the recently licence location of Hamilton Brothers on its high priced lease purchase with reports of a Carl B. King rig preparing for an early spud on this site. In addition to this it was reported in yesterday's Bulletin that a group of Canadian independents with a very significant land situation in the Zama North district have contracted a Jennings Emsco rig to drill in the vicinity of Township 117, Range 4w6 This group is headed by Canadian Superior Oil and includes Dome Petroleum and Provo Gas Producers. The move being made by those companies is in preparation for an anticipated Crown Reserve land sale that will be held in late October and is expected to include several leases in close proximity to this Group's acreage. Other companies rumored to be planning early moves into the region mapped today are Chevron Standard and Pennzoil. The former could possibly drill its recently acquired lease parcel, which offsets the Hamilton Brothers acreage to the north. Pennzoil, on the other hand, has a huge acreage spread to work on some 20 miles northeast of the discovery well. That is the P. & N. G. Reservation 409 tract which Pennzoil acquired under farmout from Atlantic Richfield last year, and in which Plains Geological Service Limited holds a ½ % gross override interest. Other companies with significant land holdings in the area are clearly defined on the front-page map.
