The CompanyExploration & Production

 

Our portfolio of key natural gas reserves

As an integrated LNG infrastructure, Pieridae Energy is also involved in exploration, drilling and development activities in natural gas reserves located in Quebec and New Brunswick. Once active, the production of these natural gas reserves will supply the company’s Goldboro LNG terminal.

Bourque project

The Bourque property, located 30 km east of the town of Murdochville, is a significant discovery. In April 2013, after the drilling results from 2012 were analyzed, the independent firm Sproule Associates estimated the volume of wet natural gas initially in place in four prospects in the Bourque property to be more than a thousand billion cubic feet. This potential discovery adds interest to Pieridae Energy’s other permits it acquired in the Gaspé Peninsula, where similar geological conditions exist.

Objectives

Reservoir zones were discovered during the drilling of the Bourque 1 and Bourque 2 wells. The commercial potential of the natural gas, condensates, and oil in this naturally fractured zone was confirmed in April 2013, giving rise to a new exploration target. Oil and gas production in the region would promote substantial economic growth due to raw material processing and the arrival of other industries to the region.

Drilling Work

The drilling work on the Bourque 1 well started on July 19, 2012, and reached a depth of 3,140 metres (2,921 vertical metres). Numerous wet natural gas shows were recorded during the drilling, and drill-stem tests yielded wet gas at the surface. Drilling of the Bourque 2 well was completed on December 13, 2012, and reached a depth of 2,680 metres. The well pointed to the existence of two zones, each approximately 300 m thick, with reservoir characteristics. Two of the three drill-stem tests yielded natural gas and light oil mixed with drilling mud was recovered. 

The most recent step in the process of confirming the presence of resources on the Bourque property, namely the re-entry and completion of Bourque No. 1 as well as the drilling of an additional well (Bourque HZ No. 3), was completed on time and within the budget. At the time, down-hole recorders were lowered in both wells in order to continue collecting pressure data. Drilling work for the lateral section of Bourque No. 1 began on September 25, 2016, and, thereafter, the drilling rig was moved a few metres toward the s expansion of the Bourque No. 1  site to drill Bourque HZ No. 3.   

A work program based on the recommendations of Sproule Associates is being drawn up.

The objective of the work will be to identify the production characteristics of the Forillon Formation and confirm its reserves. One of Pieridae Energy’s priorities is to ensure that local communities benefit from the economic spinoffs generated by the exploration, and ultimately production, of oil and gas.

HEALTH AND SAFETY

Health and safety is another top priority. The Haldimand operations will be monitored 24/7 by a team of specialists and will be based on international safety and security rules. An emergency plan was developed in partnership with the consulting firm WSP to address the specific needs of Bourque drilling operations. Municipal and provincial authorities have been made aware of this plan and all concerned stakeholders (fire department, police, and public safety officials) were involved in the process.

In addition, on the ground at all times:

  • A geologist and field manager are on site;
  • Experienced drillers and driller assistants trained for this type of work are on site;
  • A team safety meeting is held on each work shift.

Haldimand

Deposit

Discovered in 2006, the Haldimand deposit is located on the peninsula of the same name on the outskirts of the town of Gaspé, in a wooded part of the Sandy Beach area. An independent assessment by the firm Sproule Associates Limited in 2010 established a best estimate (P50) of the resources initially in place at 69.7 million barrels and the recoverable (contingent) portion at 7.7 million barrels.

Horizontal well without fracturing

Haldimand 4 will be drilled horizontally, without fracturing. Horizontal drilling is a technique that has been around for at least 30 years and consists in intercepting multiple natural fracture networks. This type of drilling makes it possible to boost productivity and reduce the project’s environmental footprint by using a single well to characterize virtually the entire deposit. The work will be carried out in compliance with the highest safety and environmental standards, with respect for local communities. In a horizontal well, a development plan and an economic scenario to develop the deposit are prepared and submitted for consultation.

Work Timeline

Drilling will take place around the clock. Although the rig is in the forest, additional measures are taken to reduce noise, including a temporary noise-mitigation wall on the edge of the site and limits on traffic in the immediate work zone. In 2012, when drilling began, the noise level measured on Forest Street, the street closest to the site, was 39 decibels, which corresponds to the noise in a typical office.

Environment

Water protection

The protection of drinking water is a Pieridae Energy priority. The hydrogeological characterization study of the Haldimand sector conducted by Institut national de la recherche scientifique— Centre Eau Terre Environnement (INRS-ETE) demonstrated that:
Oil drilling operations at Haldimand had no impact on the quality of water samples taken in the area; The risk of drinking contaminated water is low and can be reduced further using standard measures. We have already introduced a number of risk mitigation measures. For example, we have put observation wells in the bedrock aquifer to carefully monitor the condition of the groundwater layer. We also installed a watertight membrane under the Haldimand 4 site to limit the risk of liquid escaping to the surface. Furthermore, the Draft regulation respecting water withdrawals and water protection adopted by Ministère du Développement durable, de l'Environnement et de la Lutte
contre les changements climatiques (MDDELCC) stipulates that the distance between a drilling site and a groundwater well must be at least 500 meters. The Haldimand 4 well complies with this stipulation.

Health and safety

Health and safety is another top priority. The Haldimand operations will be monitored 24/7 by a team of specialists and will be based on international safety and security rules. An emergency plan was developed in partnership with the consulting firm WSP to address the specific needs of Haldimand drilling operations. Municipal and provincial authorities have been made aware of this plan and all concerned stakeholders (fire department, police, and public safety officials) were involved in the process.

In addition, on the ground at all times:

  • A geologist and field manager are on site;
  • Experienced drillers and driller assistants trained for this type of work are on site;
  • A team safety meeting is held on each work shift.

Other projects

We currently have eight natural gas resource exploration and development projects in various stages of development:
Tar Point Project; Corte-Réal Project; Gaspésia, Edgar, and Marcel-Tremblay Projects; Unnamed New Brunswick Project; Gastonguay Project; Matapédia project; Restigouche Project.

 

Tar Point Project

The Tar Point project was conceived in 2008. It concerns an area located southeast of the Haldimand project in which Pieridae holds a 50% interest. Tar Point 1, drilled in 2009 and located 15 km southeast of the Haldimand wells, bottomed out at 2,434 metres. This well crosses the entire York River Formation as well as part of the Indian Cove Formation. There were few signs of oil in the York River Formation but light crude was found in February 2010 during a production test on a naturally fractured zone in the Indian Cove Formation.

 

Corte-Réal Project

The Corte-Réal project is roughly ten kilometres west of Haldimand. It covers 500 km2 in the eastern part of the Gaspé Peninsula and is part of the Appalachian mountain range. The property lies inside a corridor that borders the northern margin of the Upper Silurian to Lower Devonian Gaspé Belt. The Corte-Réal project, in which Pieridae Energy holds a 100% interest, was conceived in 2008. It is similar to the Bourque project as it may belong to the same geological context, which would mean it has substantial exploration potential. A 26 km long seismic profile in 2008 was acquired and analyzed. An exploration model was developed based on the integration of earlier and recent seismic data with gravimetric, magnetic, and geological data. A geochemical survey and organic matter analyses were also conducted. Their objective was to refine knowledge about the maturity of the rock in the Gaspé Peninsula and its potential for generating hydrocarbons and reservoir rock.

 

Gaspésia, Edgar, and Marcel-Tremblay Projects

Pieridae Energy holds a 100% interest in Gaspésia. The area is characterized by geological layers from the Devonian, Silurian, and Ordovician periods. The adjacent Gaspésia, Edgar, and Marcel-Tremblay projects cover a large area in the west-central portion of the Gaspé Peninsula, between the towns of Amqui and Murdochville. Black clays, rich in organic matter, have been found there. This type of rock can be an essential element in the formation of hydrocarbons. Two geochemical surveys were performed in 2008 and 2011. A regional seismic survey, conducted in 2008, identified a potential target.

Organic matter analyses were carried out on soil samples from all three properties to refine knowledge about the maturity of the rock in the Gaspé Peninsula and its potential as source rock. Thermal maturation studies indicate that Gaspésia is more likely to be a source of natural gas. The emergence of projects in the region that may have a use for gas could rekindle the Company’s interest in the gas potential on the Gaspésia property. The geological context suggests that the rocks in these projects may be excellent potential reservoirs.

 

Unnamed New Brunswick Project

Pieridae Energy, through its Pieridae Production Limited Partnership (PPLP) subsidiary also holds significant interest in approximately 50,000 acres of land prospective for natural gas development in New Brunswick.
Once again, the prevalent politic and economic climate
has made exploration and development less attractive for the time being.

The initial assets acquired by PPLP consist of approximately 50,000 acres of lands prospective for natural gas development within New Brunswick.

 

Gastonguay Project

The Gastonguay project is located near Murdochville in an area where very little geological exploration work has been done. Only six wells have been drilled since 1945, all before 1980. Two wells showed signs of the presence of gas. Mine drill holes near Murdochville also showed signs of the presence of oil and gas. The geology of the northern part of the Gastonguay property is similar to that of the Bourque property, and its oil and gas potential may be comparable. Moreover, this property contains one of the biggest anticlines on the Gaspé Peninsula. This structure could be a potential target. More intensive exploration work must be done to determine more precisely where potential reservoirs are located.

 

Matapédia Project

The Matapédia project is located in the southern part of Lac Matapédia area, adjacent to the Gaspésia project. It is a 50/50 joint venture with French company Maurel & Prom. Hydrocarbon shows have been recorded in the Matapédia sector (seeps in the northern section, microseeps, and subsurface liquid hydrocarbons), which would suggest that the area is favourable to oil, condensate, and dry gas accumulations. A variety of work has been undertaken in the area since 2001, including seismic surveys (2001, 2009), geochemical surveys (2007, 2008, and 2009) and an aeromagnetic survey (2011). Some of the rocks in the Matapédia sector represent a potential reservoir, including the Val-Brillant Formation, which is composed of sandstone with partially porous intervals. Shows of hydrocarbons have been recorded in the formation. A flat spot was also found in a seismic profile at the Val-Brillant/Sayabec doublet. Hydrothermal dolomites in the Sayabec Formation are another potential reservoir. 

 

Restigouche Project

The Matapédia project is located in the southern part of Lac Matapédia area, adjacent to the Gaspésia project. It is a 50/50 joint venture with the French company Maurel & Prom. Hydrocarbon shows have been recorded in the Matapédia sector (seeps in the northern section, microseeps, and subsurface liquid hydrocarbons), which would suggest that the area is favourable to oil, condensate, and dry gas accumulations. A variety of work has been undertaken in the area since 2001, including seismic surveys (2001, 2009), geochemical surveys (2007, 2008, and 2009) and an aeromagnetic survey (2011). Some of the rocks in the Matapédia sector represent a potential reservoir, including the Val-Brillant Formation, which is composed of sandstone with partially porous intervals. Shows of hydrocarbons have been recorded in the formation. A flat spot was also found in a seismic profile at the Val-Brillant/Sayabec doublet. Hydrothermal dolomites in the Sayabec Formation are another potential reservoir.