More than $6 million in Sales Boosts Provincial Economy: Chomiak
The latest offering of oil and gas rights for sale in Manitoba has resulted in record-breaking sales that will contribute more that $6 million to the province’s economy, Innovation, Energy and Mines Minister Dave Chomiak announced today.
“Changing technology and Manitoba’s competitive nature have combined to make this year a banner year for oil and gas rights sales in this province,” said Chomiak. “Having a diverse economy has been critical in helping Manitoba thrive and we’re very pleased to see this important sector growing.”
The competitive bidding process that closed on May 12 generated the largest single sales offering of oil and gas rights in Manitoba’s history at just over $6 million. The sale exceeded the previous record, set in 1997, by $2.1 million.
A total of 68 lease parcels, covering 8,166 hectares was sold in this offering.
Leases provide the exclusive right to produce petroleum and natural gas and are acquired by the successful bidder at the Crown sale. Primary terms are for five years and are renewable up to 10 years.
The petroleum industry in Manitoba produces about 4,692 cubic metres or 29,533 barrels of oil per day and employs a workforce of about 1,500. These high-paying technical jobs have contributed to the economic stability of southwestern Manitoba, said Chomiak.
In 2009, there were approximately 3,000 wells in Manitoba, with the industry generating roughly $620 million in production and $485 million in investment in the province. The province forecasts that 420 wells will be drilled in 2010, producing 9.5 million barrels of oil annually.
This is the second of four sales scheduled for 2010. The next sale will be held on Aug. 11.