Old Harry project dead in the water, for now
Company says it has ended technical work and spending at the site
Seven years after Quebec first struck an oil deal in the Gulf of St. Lawrence, exploratory work has been suspended on the Old Harry project for the foreseeable future.
Corridor Resources Inc. announced Monday that after completing its geotechnical analysis, it has ended all work and spending on the site.
"Corridor has determined there is no longer a viable path to drilling an exploration well on the prospect before the current exploration licence on the Newfoundland side expires in January 2021," the Halifax-based company said in a press release.
The Old Harry site, located about 80 kilometres off the southwest tip of Newfoundland in an area that straddles the N.L-Quebec border, has been speculated to hold significant oil and gas reserves.
But in a press release Corridor said that after analyzing data, "the Old Harry structure is more complicated than previously understood," which led the company to believe the area may not be as resource rich as initially thought.
"The play could be more gas prone than oil prone and the overall hydrocarbon accumulation could be less than originally estimated," stated Corridor's release.
Corridor's exploration work has been dogged by protests from environmental groups opposing potential drilling in the Gulf of St. Lawrence. The company still holds exploration licences with both the N.L. and Quebec governments, both of which have been the source of legal controversy and delays.
No joint venture partner found
In the decision to suspend its work, Corridor stated another factor was the company's inability "to date to attract a joint venture partner for the prospect," which it needed in order to operate any potential project.
"We have recently approached numerous large oil companies to solicit joint venture interest. To date, we have been unsuccessful due to a number of factors," said the release.
It went on to blame the disinterest on the need for more extensive surveying, a lack of clarity around the company's land tenure in Quebec, and an industry belief that Old Harry probably contains more natural gas than oil.
The company plans to ask the Quebec and N.L. provincial governments as well as the federal government, to grant Corridor a new licence for the N.L. side of the structure and clarify the status on the Quebec side.
If that is done, the company will continue to look for a partner for the project, the release said.