Southwest interest climbs during June's crown petroleum and natural gas rights sale

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The Southwest showed increased activity during the June sale of Crown petroleum and natural gas rights, attracting $2.64 million in activity and topping the $2 million mark after falling below that mark during the previous three sales.

Province wide the June land sale generated $10.5 million, the lowest total dating back 19 sales to February 2009. It was also the worst June sale since June 2004.

The Weyburn-Estevan area received the most activity with sales of $4 million, followed by the Lloydminster area at $2.65 million which just edged out the $2.64 million in bid activity in the Swift Current. The quietest region in the province was the Kindersley-Kerrobert area at $1.2 million.

June's sale included 133 lease parcels that brought in $9.4 million in bonus bids and three petroleum and natural gas exploration licences that sold for $1.1 million.

The highest price for a single parcel was $782,957 paid by Sandstone Land & Mineral Company Ltd. for a 1,036-hectare exploration licence southwest of Fox Valley.

During 2012, the Crown petroleum and natural gas rights sales have generated $55.6 million in revenue for the province.

Minister responsible for Energy and Resources Tim McMillan said June land sales are historically quieter in terms of industry interest and number of hectares on offer.

"What we're seeing right now from oil companies is a focus on working the dispositions they currently have," McMillan said. "That's reflected in the level of drilling activity so far in 2012. Last year was our second-best year for oil well drilling and a record year for horizontal oil well drilling. We're ahead of the pace on both counts so far this year, and that activity helped us set an all-time record for monthly oil production in March.

"While we're not witnessing new large-scale land acquisitions right now, the industry is very busy, and all indicators are pointing to a banner year for investment and activity in Saskatchewan's oil fields."

The next sale of Crown petroleum and natural gas dispositions will be held on Aug. 13.

Geographic location: Swift Current, Saskatchewan

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