Second Lease Sale Held in Yukon Territory

About 104 square miles of virgin natural gas hunting grounds are being thrown open within reach of potential routes for the proposed Alaska pipeline by the Yukon Territory's second sale in two years. Companies are being given until March 14 to bid on the parcel, which borders on two areas that Anderson Exploration Ltd. scooped up in the first sale, which was in turn the first one held by the Yukon in two decades.

Located in an area called Eagle Plain, near the Arctic Circle, the new offering is 185 miles north of Dawson City and lies beside the Dempster Highway between the Yukon capital of Whitehorse and Inuvik on the Mackenzie Delta in the Northwest Territories. The prospective drilling area is about 180 miles north of the Alaska Highway (also known as the Klondike Highway along its Canadian legs). A 1994 estimate by the National Energy Board, relying on very limited information from scant exploration activity in the area, estimated that the Eagle Plain Basin harboured 83.7 Bcf of natural gas and 11.1 million barrels of oil. Of 22 wells drilled in the region since 1960, three successes have earned long-term rights to hold property as "significant discovery licences" for Chevron Canada Resources and Northern Cross (Yukon) Ltd. The new parcel is adjacent to the old discoveries.

Yukon Premier Pat Duncan described the auction as keeping a promise to make exploration opportunities available regularly, following transfer of resource jurisdiction to the territory from the federal government. The sale also makes advances towards making northern gas activity into a matter of routine for the industry compared to regulatory and community-relations marathons of previous eras.

Duncan said the new auction incorporates results of a public review since the first sale of drilling rights in 1999. "As a result of comments received, we will incorporate requirements for environmental and heritage considerations," the premier said. "Our ultimate goal is to ensure that the development of the Yukon oil and gas industry occurs in a responsible manner, respects our environment and provides economic benefits to Yukoners."

Preliminary work towards a decision on northern pipeline routes continues. Studies by Alaskan producers have sprouted a branch in Calgary, where experts on regulatory and marketing affairs are piecing together information on Canadian aspects of a U.S. project. At the same time, consultants are putting together information packages to present to Canadian authorities and working on proposals for a co-operative regulatory approach intended to reduce notoriously long review and approval procedures for northern projects.

Gordon Jaremko, Calgary

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