March 25, 1996
(Mines and Energy)

The following statement was issued by Dr. Rex Gibbons, Minister of Mines and Energy. It was also read in the House of Assembly:

Successful Request for Bids for Onshore Western Newfoundland

On May 4, 1992, I announced a successful Request for Bids that resulted in work expenditure commitments of approximately $1.7 million for three petroleum exploration permits onshore western Newfoundland. Those permits covered an area of about 177,000 hectares.

On February 5, 1993, I announced a second successful Request for Bids that resulted in work expenditure commitments of approximately $5.7 million for an additional six exploration permits. Those permits covered an area of about 190,000 hectares.

On November 23, 1995, I announced a third Request for Bids, at which time interested parties were invited to submit bids in the form of work commitments on 31 parcels of land by March 22, 1996.

I am pleased to announce today that I have selected bids totalling approximately $21 million on 28 parcels covering an area of about 878,800 hectares.

As before, the successful bids are in the form of work expenditure commitments whereby the companies undertake to spend the bid amount on exploration during the five year term of the exploration permit.

The successful bidders are:

• For Parcels #1 to 6, 12 to 13, 26 and 28 to 31, Sandhurst Roxana Exploration Ltd. with total bids of $3,773,000;
• For Parcels #7, 11 and 18, Vinland Petroleum Inc. with total bids of $828,000;
• For Parcels #8 and 27, London Resources Inc. with total bids of $590,200;
• For Parcel #9, Gentry Resources Ltd. with a bid of $12,500;
• For Parcels #16, 19 and 22, Mobil Oil Canada Properties with total bids of $4,684,250;
• For Parcel #17, Canadian Trans Ocean Petroleum Corp. with a bid of $511,111.77;
• For Parcels #20 and 23, Hunt Overseas Operating Company and PanCanadian Petroleum Limited with total bids of $10,350,000;
• For Parcel #21, 10486 Newfoundland Inc. with a bid of $52,500;
• For Parcel #24, Imperial Venture Corp. with a bid of $185,440; and
• For Parcel #25, Jay Construction Ltd. with a bid of $28,700.

Certain requirements must be met before I will be able to issue permits, pursuant to this Request for Bids. This includes the receipt of a security deposit for each permit in the amount of 20 per cent of the total bid amount.

Provided all requirements are met, the number of onshore exploration permits issued since the Newfoundland and Labrador Petroleum Regulations were promulgated in 1991 will total 37. Total work expenditure commitments amount to approximately $28.4 million.

I note that momentum is building offshore western Newfoundland as well. Currently there are three exploration licences in effect and the Canada-Newfoundland Offshore Petroleum Board has issued a Call for Bids on eight offshore parcels, four of which are located offshore western Newfoundland. This call closes September 30, 1996. In addition, Hunt Oil et al intends to start an offshore well, six kilometres SW of Cape St. George in May or June.

I am extremely gratified by the level of interest that the oil and gas industry has expressed in western Newfoundland. Government hopes that this will lead to further economic activity whereby the full petroleum potential of the area will be realized.

SUMMARY OF SUCCESSFUL BIDDERS
REQUEST FOR BIDS, 1995

     PARCEL NO.               COMPANY                         BID

        1           Sandhurst Roxana Exploration Ltd.       $262,000
        2           Sandhurst Roxana Exploration Ltd.       $262,000
        3           Sandhurst Roxana Exploration Ltd.       $262,000
        4           Sandhurst Roxana Exploration Ltd.       $262,000
        5           Sandhurst Roxana Exploration Ltd.       $262,000
        6           Sandhurst Roxana Exploration Ltd.       $262,000
        7           Vinland Petroleum Inc.                         $202,000
        8           London Resources Inc.                         $35,100
        9           Gentry Resources Ltd.                         $12,500
       10           No Bid Received
       11           Vinland Petroleum Inc.                         $601,000
       12           Sandhurst Roxana Exploration Ltd.       $321,000
       13           Sandhurst Roxana Exploration Ltd.       $252,000
       14           No Bid Received
       15           No Bid Received
       16           Mobil Oil Canada Properties                     $905,625
       17           Canadian Trans Ocean Petroleum Corp.    $511,111.77
       18           Vinland Petroleum Inc.                             $25,000
       19           Mobil Oil Canada Properties                     $3,312,875
       20           Hunt Overseas Operating Company 
                    and PanCanadian Petroleum Limited           $5,175,000
       21           10486 Newfoundland Inc.                       $52,500
       22           Mobil Oil Canada Properties                 $465,750
       23           Hunt Overseas Operating Company 
                    and PanCanadian Petroleum Limited       $5,175,000
       24           Imperial Venture Corp.                          $185,440
       25           Jay Construction Ltd.                           $28,700
       26           Sandhurst Roxana Exploration Ltd.       $212,000
       27           London Resources Inc.                         $555,100
       28           Sandhurst Roxana Exploration Ltd.       $531,000
       29           Sandhurst Roxana Exploration Ltd.       $212,000
       30           Sandhurst Roxana Exploration Ltd.       $212,000
       31           Sandhurst Roxana Exploration Ltd.       $461,000

Click here for an illustration for onshore Western Newfoundland showing parcels with successful bids