Shares of Corridor Resources Inc. took a pounding on Wednesday after the company announced it has so far been unsuccessful in finding a joint venture (JV) partner to help develop its prospect in the emerging Frederick Brook Shale.
Corridor, a junior producer based in Halifax, NS, said prospective JV partners for its prospect near Elgin, NB, have been citing current economic conditions and the low level of natural gas prices as the main reasons for their reluctance to participate. The company said it will continue searching for a JV partner into 2012.
Corridor said it may perform a fracture stimulation technique using liquid propane to help stimulate multiple intervals of a vertical shale gas appraisal well, Will DeMille O-59. The company said it has had previous success with the technique at another well, Green Road G-41.
"[We are] very pleased with the results to date from the Will DeMille O-59 [well]," the company said, adding that its completion "would be part of [our] continuing program to advance a shale gas pilot project in the Elgin area."
The company said it will end 2011 with working capital of approximately $6 million and no debt. It will announce its 2012 capital expenditure (capex) program during 1Q2012.
Last June Apache Canada Ltd., a Canadian subsidiary of Apache Corp., announced it was dropping out of a JV with Corridor to test and appraise the Moncton Basin for C$100 million, citing poor results from two natural gas test wells (see Shale Daily, June 3). Apache Canada and Corridor first agreed to a C$25 million partnership to evaluate the commercial potential of the Frederick Brook in late 2009 (see Daily GPI, Dec. 8, 2009).
Corridor holds approximately 820,000 net acres in the Moncton Basin and was one of the first energy companies to invest in the Canadian Maritimes, which includes the Frederick Brook (see Daily GPI, Oct. 4, 2007). Corridor also has -- along with JV partner Petrolia Inc. -- more than 1.5 million acres of leasehold on Quebec's Anticosti Island in the Gulf of Saint Lawrence, which sits atop the Macasty Shale (see Shale Daily, July 18; Feb. 14).