By Andrew Willis
Here’s a little more intelligence on Alberta’s $384 million land sale, which opened up a new natural gas play in the province.
The largest land sale in four years, in the words of FirstEnergy Capital analyst Robert Fitzmartyn, “should easily prove to be the most interesting sale of 2009 for the province, targeting a new and emerging shale play.”
The bulk of the land that Alberta leased for exploration is in what’s loosely known as the Kaybob region in the west central part of the province. In looking at the overall results of the auction, Mr. Fitzmartyn said the bids were well over what he expected – FirstEnergy projected a $325 million auction.
And when it came to who was actually behind a great many anonymous bids, Mr. Fitzmartyn came up with a slightly different list of contenders than Calgary-based peers. He said: “Likely players in this sale are Tourmaline Oil, Talisman (NYSE:TLM), EnCana (NYSE:ECA), Apache (NYSE:APA), BP (NYSE:BP), and Shell (NYSE:RDS.A).”
“Those that could implicitly benefit by holding deep rights in the region are Daylight Resources Trust (OTC:DAYYF) and Celtic Exploration, although one cannot rule them out as active participants here,” said the FirstEnergy analyst in a report.
Conspicuous in its absence from this list is Canadian Natural Resources (NYSE:CNQ), a major gas player in this part of Canada. FirstEnergy’s take is Canadian Natural didn’t take part in this auction; RBC Dominion Securities analysts speculated earlier in the day that the company was a buyer in Kaybob.