In a slow start to 2024, Canadian licensing declined for the second consecutive month. Between January 13 and February 12, 633 licences were obtained. This represents a 4.5% decline compared to the previous month, which saw companies obtain 663 new licences. This past month’s licences were spread across 88 unique licensees, representing an average of 7.2 licences per licensee. Overall, licensing activity for the month was dominated once again by producers operating in the Montney, particularly in BC where new licence volumes were high for a number of major producers. With that said, a somewhat unexpected jump in Duvernay licensing is what really caught our eye this month. Using data from BOE Intel and Petro Ninja, we’ve identified a number of trends across the various producers and producing formations.
Licensees
- CNRL was the busiest licensee this month, with 52 licences obtained. As observed in prior months, the company appears to be prioritizing its thermal/heavy oil and oil sands assets. Of the company’s 52 licences, 11 targeted the Sparky, 8 targeted the Clearwater, 7 targeted the Waseca and 2 targeted the McMurray.
- Petronas was the second most active licensee, with the bulk of its activity centered at the Town field along with 2 licences located at W Gundy. The company’s licences in these areas are tucked in between existing developments, indicating continued and expanded exploitation of assets that are already producing. We can’t help but notice that Petronas’ Canadian production continues to creep up; the company accounted for gross licensed production of just under 150,000 BOE/d in December 2023 compared to around 126,000 BOE/d in December 2022.
- Tamarack Valley obtained 25 licences this past month, with a majority at Marten Hills. Interestingly enough, however, the company also obtained a Charlie Lake licence at Valhalla and 3 Clearwater licences at Perryvale. The Perryvale licences, in particular, caught our attention as they are in close proximity to the company’s 04-24 fan well, which Tamarack highlights in its corporate presentation (access the presentation here). The company has been experimenting with this new well design in its South Clearwater area, which the company specified would be the site of 15 net wells in 2024.
- Teine Energy obtained a combined 28 licences across its asset groups, but devoted particular attention to its Duvernay assets at Carrot Creek (6 licences). Known for being the largest private Viking producer with Chauvin medium oil assets and Bakken production as well, we may be seeing a progression of the company’s activity in the Duvernay. On the company’s website, Teine says it sees “the potential for a multi-generational commitment” to the Duvernay as it now “controls over 300,000 acres within the light oil formation of the Duvernay.” These 6 Duvernay licences dramatically expand on only 9 Duvernay licences previously issued to Teine over the last 3 years.
Licensees | Licence Count |
Canadian Natural Resources Limited | 52 |
Petronas Energy Canada Ltd. | 38 |
Ovintiv Canada Ulc | 31 |
Strathcona Resources Ltd. | 29 |
Ipc Canada Ltd. | 28 |
Teine Energy Ltd. | 28 |
Whitecap Resources Inc. | 27 |
Arc Resources Ltd. | 27 |
Tamarack Valley Energy Ltd. | 25 |
Tourmaline Oil Corp. | 24 |
Others | 324 |
Total | 633 |
Producing Formations
- The Montney, as has been the case in most months this past year, was the formation that saw the most licensing activity this month with 158 unique licences obtained. Top Montney licensees include Petronas (38 licences), Ovintiv (30 licences), ARC Resources (27 licences) and Tourmaline (16 licences). Roughly two-thirds of the licences were in BC, the largest proportion we’ve observed in months for this play.
- The Lower Grand Rapids producing formation was targeted with a surprising 27 licences, the most of any month since we began preparing monthly licensing reviews last year. All 27 of these licences were obtained by IPC Canada in township 076-18W4. These wells are situated in close proximity to a number of the company’s existing licences targeting the Clearwater. The area appears to be relatively undeveloped, and it will be interesting to see how IPC proceeds through the year.
- The Duvernay saw its most activity in months, with this period’s 40 licences eclipsing totals from our three most recent licence activity reviews (accessible here, here and here). Licensing volumes were spread evenly across a solid number of producers including Teine Energy (6 licences), Whitecap Resources (5 licences), Crescent Point (3 licences) and Paramount Resources (2 licences) among others. We highlighted Teine’s activity earlier in the article, but also wanted to make a special mention of Athabasca Oil’s 2 Duvernay licences on account of its announced Duvernay Energy Corporation joint venture with Cenovus.
Producing Formation | Licence Count |
Montney | 158 |
Clearwater | 57 |
Duvernay | 40 |
Viking | 38 |
Sparky | 33 |
Waseca | 31 |
Lower Grand Rapids | 27 |
Mcmurray | 24 |
Cardium | 23 |
Bakken | 20 |
Others | 182 |
Total | 633 |
To keep track of the latest licensing activity in the Canadian oil patch for yourself, check out BOE Intel.