PanCanadian Offers High Bid on Coal Gas

PETROLEUM DIRECTORATE--PanCanadian Offers High Bid on Coal Gas Exploration

The Nova Scotia government has signed an agreement with PanCanadian Petroleum Limited for exploration of coal gas deposits in the Stellarton area. The company was the highest bidder on the property.

PanCanadian made a commitment to spend as much as $3.95 million to explore in the area. The exact expenditure depends upon the number of wells drilled and detailed drilling plans adopted.

"PanCanadian has clearly demonstrated their confidence in the future of our offshore, and it is encouraging to see them expand their attention to our onshore," said Gordon Balser, Minister responsible for the Petroleum Directorate.

The exploration plans include an area near the former Westray Mine site, but an exclusion zone ensures that no activity takes place at the mine site itself, where 26 miners lost their lives eight years ago.

Representatives of the families of the former Westray miners have been kept informed about the process and plans to date. Officials with the Petroleum Directorate and PanCanadian have arranged to meet with family representatives early in the new year to discuss plans for the area.

If the preliminary exploration work is successful and commercial production begins, the methane gas could be available for local needs as well as large industrial users in Nova Scotia. As coal gas is largely made up of methane, it can also be mixed with other methane energy sources such as natural gas.