Independent producer Canadian Superior Energy Inc. said Wednesday El Paso Corp.’s Canadian production subsidiary has agreed to join in developing and drilling its Mariner natural gas prospect offshore Nova Scotia, which is believed to hold potential reserves of more than 1 Tcf. This marks the second time the two producers have joined forces in the region.

The “farm-in” arrangement calls for El Paso Oil and Gas Canada Inc. to pay a “proportionate” percentage of the expenditures for seismic, drilling and completion activities in exchange for an interest in Canadian Superior’s Mariner prospect, said Mike Coolen, director of East Coast Operations for the Calgary-based producer. The exact terms of the deal were not disclosed.

The Mariner prospect covers a total of 101,800 acres located adjacent to five significant discoveries near Sable Island, including the 1.6 Tcf Venture gas field situated Southeast of Halifax. Seismic reviews conducted over the past year have identified three large gas-bearing structures that are ripe for drilling on the Mariner block.

The two producers expect to begin drilling this year, said Coolen, but he noted it was “hard to tie it down to an exact month.” The Mariner well will be one of the deepest wells to be drilled in Canada this year, with the depth reaching 19,685 feet at an estimated cost of $60 million when completed, the company said.

The Mariner prospect, which is located in shallow water depths of about 180 feet, was acquired by Canadian Superior in November 2001 for $15.5 million.

Last April, Canadian Superior and El Paso Oil and Gas Canada teamed up to drill an exploratory well on the Marquis block off the coast of Nova Scotia near Sable Island, Coolen noted.

“They bring a lot of expertise to the table,” said Canadian Superior President Greg Noval. “El Paso’s continuing commitment with us to develop the Nova Scotian offshore basin should be seen as positive for the industry and for Nova Scotia.”

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