Old wells see new life, and big profits
NATHAN VANDERKLIPPE
CALGARY— Globe and Mail Update
Published
Last updated
Rising oil prices have fuelled a rebirth of Canada’s junior oil(CL-FT89.331.541.75%)and gas (NG-FT4.540.132.83%)companies, which are once again snapping up new land and exploring new frontiers as a remarkable comeback takes hold.
After years of watching their ranks shrivel amid an economic recession and oil and gas fields that were nearly spent, the junior sector is remaking itself as it taps back into reservoirs it once thought dry.
Companies are taking the success of a core group of new plays and spreading it across western Canada and beyond, betting that technological advances will unlock the great bodies of crude that remain in dozens of old plays, some of which have seen less than 10 per cent of their oil recovered.
Canada’s juniors remain heavily dependent on natural gas, a fact that has muted the impact of new oil plays for some. But for others with exposure to oil, the new prospects are so bright that, little more than a year after tight credit choked off much of the sector’s lifeblood, money is again pouring in.
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