PanCanadian Expands Gas Find Off Nova Scotia

PanCanadian Petroleum encountered a huge amount of gas with its third Deep Panuke appraisal well, M-79A, drilled offshore Nova Scotia. During a five-day test, the well flowed at an average rate of more than 63 MMcf/d despite limitations in the downhole configuration of the test string.

The M-79A well is located about 155 miles southeast of Halifax, NS, and about 1.9 miles east of the Panuke platform. PanCanadian holds a 100% working interest in the Deep Panuke field. The M-79A well was drilled to a total depth of 15,105 feet, which was followed by a horizontal sidetrack in the main reservoir section. The horizontal sidetrack encountered 360 feet of net pay. The reservoir is currently estimated at about five miles in length.

"These very encouraging results from the third appraisal well will allow us to evaluate the overall potential of the Deep Panuke field," said CEO David Tuer. "The test results are very promising, and further analysis will be conducted to determine the full extent of the field."

This is the first new gas find offshore Nova Scotia since the South Sable field was discovered in 1989. The company expects to make a decision on the commerciality of a stand-alone development of this field by the end of the first quarter of 2001. It did a detailed analysis of the results of this well and the three previously drilled wells, all of which flowed at more than 50 MMcf/d during multi-day tests --- the maximum capacity of the testing equipment. The company has not released any reserves estimates.

A spokeswoman said PanCanadian would look at several transportation options, including shipment on the existing Sable/Maritimes gas pipeline system, building a new pipeline system or even converting the gas to power and sending it to shore as electrons.

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