* Minister study monitoring, capping technology
* Hopes gear can be used to address relief well rules
* BP has Beaufort Sea acreage with Exxon, Imperial
By Jeffrey Jones
CALGARY, Alberta, Dec 5 Canada's Northwest
Territories is studying oil well monitoring techology used by BP
Plc in the Gulf of Mexico following its 2010 oil spill
there in hopes that it can be applied to Arctic wells, the
Territories' industry minister said on Wednesday.
David Ramsay, minister of industry, tourism and investment
in the resource-rich and sparsely populated territory, said it
may be possible that such gear can be used to satisfy Canadian
regulators, who reviewed regulations for offshore oil and gas
operations in the Arctic following BP's Macondo disaster.
Ramsay toured BP monitoring facilities this week in Houston,
where he also spoke at an event hosted by the Canadian
The Northwest Territories is seeking investments in oil and
gas as a way to bring economic benefits to a region that suffers
from high unemployment. A long-sought pipeline to move gas from
the onshore Mackenzie Delta to southern markets is years behind
"They (BP) are going to be a player in the Beaufort, in the
Arctic, so it's important for us to meet with them to get an
understanding of how they are going to try to address the
same-season relief well requirements," he told Reuters in a
After its review, Canada's National Energy Board reaffirmed
a long-standing policy that requires drillers in the Far North
offshore to demonstrate that they can drill a relief well during
the same season of its initial well in case of a blowout.
The NEB said, however, that applicants wanting to depart
from the rule would have to show how they would meet or exceed
the policy's intended outcome, aimed at protecting the
environment in the fragile region from contamination.
Ramsay said it is important for the territorial government
to see what might be available as far as offering
"equivalencies" to same-season relief wells.
He was shown BP's monitoring stations and a capping stack, a
massive steel structure like the one the company used to finally
cap the blown-out Macondo well that spewed nearly 5 million
barrels of oil into the Gulf of Mexico for almost three months.
Last month BP agreed to pay $4.5 billion in penalties and
plead guilty to criminal misconduct over the disaster, which
caused the worst offshore oil spill in U.S. history.
As part of a deal announced in 2010, BP pooled its Canadian
Beaufort acreage with that held by Exxon Mobil Corp and
Imperial Oil Ltd. The aim was to avoid duplication of
equipment and personnel.
The partners are currently assessing options for exploring
and developing the acreage, but there are no current plans to
start drilling, Imperial spokesman Pius Rolheiser said.
"We hope to someday have activity back in the Canadian
Beaufort and be able to look at monitoring the in the Beaufort
in the Northwest Territories," Ramsay said.
Chevron Corp has been conducting seismic studies in
the region and expects to return in the summer of 2013, and a
small British company, Franklin Petroleum, is also devising a
seismic program for next season, he said.
In his speech on Wednesday, Ramsay said the Northwest
Territories has an estimated 81 trillion cubic feet of natural
gas and almost seven billion barrels of oil.
The trick has been developing the resources and getting them
to market. The Imperial-led Mackenzie Valley Pipeline is stalled
against a backdrop of weak natural gas prices and booming shale
gas supplies closer to market.
The government is optimistic, however, about the Conol shale
oil formation near Norman Wells in the central Mackenzie Valley,
where companies such as Husky Energy Inc, Royal Dutch
Shell Plc, ConocoPhillips and MGM Energy Corp
have launched exploration programs to tap an estimated
two billion to three billion barrels of crude.