Shell to drill seven wells offshore Nova Scotia: Canadian agency

Calgary (Platts)--6 Dec 2013 231 pm EST/1931 GMT

Shell Canada plans to drill up to seven exploratory wells at its four licensed areas offshore Nova Scotia, a federal Canadian agency said Friday.

The wells will be drilled from 2015 to 2019 at sites located 250 km (160 miles) off the coast of Nova Scotia. Specific locations will be determined using data gathered as part of the Shelburne Basin 3-D seismic survey that Shell conducted over the summer, the Canadian Environmental Assessment Agency said.

"Shell submitted a project description on November 26 and we are now in the first stage of screening," CEAA spokeswoman Sofie McCoy-Astell said. "We have until January 16 to determine if an [environmental impact assessment] report is required for the drilling."

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Stakeholders in Nova Scotia have a deadline of December 23 to inform the CEAA of objections to Shell's plans, she said.

The drilling of up to seven wells was part of a six-year agreement Shell Canada signed in early 2012 with the federal/provincial regulator Canada-Nova Scotia Offshore Petroleum Board, committing to invest about C$970 million ($965 million) in developing the deepwater blocks in the Atlantic Ocean.

Shell was not immediately available to comment Friday, but Randy Hiscock, the company's manager for business development and new ventures, said at an industry event in October that the earliest drilling could start would be 2015, depending on the results of the seismic research, rig scheduling and getting the proper equipment in place.

"We feel pretty positive about early results of the seismic program," he said in October at the Maritimes Energy Association's annual conference in Halifax. "As we get through the interpretation of that seismic data, it will determine how and if and when we move forward. But I'm fairly confident that it's looking good, and oil is what we are banking on rather that natural gas."

Shell's 3-D seismic survey in the Shelburne Basin covered nearly 8,500 sq km and water depths of 1,500-3,500 meters CNSOPB spokeswoman Kathleen Funke said Friday.

Nova Scotia is home to the 600,000 Mcf/d Sable Offshore and 300,000 Mcf/d Deep Panuke facilities, two of the largest natural gas exploration and production facilities in eastern Canada, operated by ExxonMobil and Encana, respectively.

The province is also enlisting the support of international companies to develop its oil resources. In November 2012, CNSOPB awarded licenses for eight oil and gas blocks to BP and Shell, which committed to investing C$1.08 billion. Of this, BP said it would invest C$1.05 billion, followed by Shell at C$31.75 million, Funke said.

The new blocks are located on the deepwater southwestern Scotian Slope and the Sable sub-basin, where there is strong evidence of early Jurassic-restricted marine oil-prone source rock and also where 23 significant gas and oil discoveries have been made to date, Funke said.

--Ashok Dutta,
--Edited by Annie Siebert,

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