IN THE NEWS / Shoal Point Well Could Spur West Coast Actitivy 1/22/99
By Pat Roche
Daily Oil Bulletin
Results of a well PanCanadian Petroleum Ltd. is spudding this month will probably determine whether the onshore Western Newfoundland area sees any further exploration spending before crude oil prices improve, says a consultant who studied the area for several companies.
“If this yields what it's hoped to yield, it will help to continue a lot of interest,” said Henry Williams, a consultant on sabbatical from Memorial University.
The well is being drilled at Shoal Point in the middle of the Port au Port Peninsula.
John Harper, a former Memorial University earth scientist who now works in Calgary and had studied the area with Williams, agrees with the prognosis.
“If this well goes, it's going to change the whole climate of Western Newfoundland (as far as onshore oil exploration is concerned),” Harper said this week.
Six wells have been drilled in the region in the past five years. Five were spudded on the Port au Port Peninsula and a sixth near St. Anthony on the Northern Peninsula.
Other companies with acreage in the area in recent years include Hunt Oil Co. and Mobil Oil Canada.
Based on his studies and the results of some previous exploration programs, Williams said the most likely areas for finding oil are the Port au Port Peninsula and around Gross Morne National Park.
“But it's a very complicated area. It's going to take a lot more work just to understand it,” he said.
Prospects of finding oil onshore in Western Newfoundland are good but the area is hampered by complex geology and high exploration costs, said Williams.
It's expensive because there's little infrastructure in place. Rigs and other equipment usually must be brought in from distant locations. Drilling a single well on land in Western Newfoundland can easily cost $10 million to $15 million, he pointed out.
Forest and bog covering much of the area restrict exploration to more costly methods such as seismic, Williams said.
Western Newfoundland has tantalized petroleum geologists since the turn of the century, when the first shallow wells were drilled near Parsons Pond, about half way up the Northern Peninsula. Union Pacific Resources Inc. owns the lease at Parsons Pond.
In past years, area fishermen reportedly used the light, high-quality oil seeping from the ground in engines without refining, Williams said.
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