Interest in exploration licenses in southeast Saskatchewan in February land sale

Regina – It is apparent someone’s sniffing around for exploration leases in southeast Saskatchewan, as a substantial portion of land was posted in the most recent Crown land sale. However, roughly one third of it was actually purchased.

The most recent Crown land sale came in below the average for the past year, but at a number that is relatively consistent. On Feb. 6 the Ministry of Energy and Resources released the results of February public o􀀁ering of Crown petroleum and natural gas rights. That sale, held Feb held Feb. 4 raised $1.9 million in revenue for the province of Saskatchewan, bringing the final total for the 2019-20 fiscal year to $17 million a􀀂er six sales.

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The total number of parcels sold in the Estevan area was half of what was posted, and only a third of the land area posted. There were 20 parcels posted in the Estevan area totally 52,698 hectares. Six were exploration licences totalling the vast bulk of the land posted, 51,372 hectares, while 14 were leases totalling 1,324 hectares. Eight of those leases sold for a total of $1,013,622, bringing in $1,367 per hectare in bonus.

Of the six licences posted, two actually sold, totalling 17,818 hectares. The 51,372 hectares that had seen some interest is significant, in that it is the equivalent of 203.5 sections of land. However, it is common that not all land posted actually sells.  

The bonus bid for the exploration licenses in southeast Saskatchewan was $35.53 per hectare.

The average for Crown land sales for the past year, including this sale, was $2.75 million, which included two sales that came in at $1.5 million each, and one better one at $6 million. In Saskatchewan, the sales are held ever second month. Other provinces work on different schedules, with Alberta being more frequent and Manitoba less so.

The December 2019 land sale brought in $3.4 million. In October 2019, the number was $2.2 million. August 2019 saw $1.5 million. June 2019 was $6 million, and April was $1.5 million.

Most of that $1.9 million was spent in southeast Saskatchewan, generating $1,646,667 for the aforementioned two exploration licences and eight leases totalling 18,560 hectares. The highest bonus bid received on a parcel in this o􀀁ering was$701,760 for a 224.5-hectare lease northeast of Midale. This parcel was purchased by Millennium Land (222) Ltd. and is prospective for oil in the Frobisher Beds of the Madison Group and the Bakken Formation.

Two exploration licences totalling 17,818 hectares in the Estevan area received a total of $633,045. That area covers 68.8 sections of land, nearly two townships worth.

These parcels are situated southwest of Radville and are prospective for oil in the Ratcli􀀁e Beds of the Madison Group, the Bakken Formation and the Red River Formation. Petro-Lin Energy Corporation bid $432,537 to acquire one exploration licence consisting of 9,167.8 hectares, while 1140234 Alberta Ltd. bid $200,508 on the other licence totalling 8,650 hectares.

Kindersley had three leases posted but only one acquired. The total bonus received in the area was $144,197, an average of $556/hectare. This compares to $1,346,468, an average of $267/hectare at the last offering.

Turnstone Energy Inc. picked up the only lease in this area with an offer of $144,197. This 259.6 hectare lease is located adjacent to the Greenan Viking Gas Pool, 13 km southwest of Elrose.

The Lloyminster area total bonus received in the area was $107,108, an average of $289/hectare. This compares to $563,283, an average of $123/hectare at the last offering. Gear Energy Ltd. was the top bidder in this area, bidding $85,530 for two leases totalling 32.7 hectares Each of these leases received the highest dollars per hectare in this area at $2,618 per hectare. These leases are located five kilometres south of Paradise Hill, near the Celtic Mannville Oil Pool.

There were no bids in the Swift Current area.

The scheduled date for the next public o􀀁ering is April 7, 2020, which will be the first o􀀁ering for the 2020-21 fiscal year.

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