July-August Licence Activity Review – A busy summer in the Montney

The past month has seen an uptick in licensing activity across the Canadian oil patch. From July 13 to August 12, 536 licences were obtained. This represents a 22.1% increase over the previous month, which saw companies obtain 439 new licences. This past month’s licences were spread across 80 unique licensees, representing an average of 6.7 licences per licensee. Using data from BOE Intel and Petro Ninja, we’ve identified a number of trends across the various producers and producing formations.

Top Licensees

Among the top licensees, we identified the following trends:

• For the second month in a row, Cenovus obtained the most licences of any producer in Canada. 31 of its licences targeted the McMurray formation, compared to 18 McMurray licences last month. 3 of these McMurray licences are located in the company’s Sunrise oilsands asset, while the remainder appear to be located in the Foster Creek area. The remainder, apart from a single licence targeting the Spirit River in Wapiti, were located in Lloydminster where Cenovus has thermal oil assets and conventional heavy oil assets.
• Tourmaline obtained 38 licences this past month, with 32 targeting the Montney and 6 targeting the Spirit River. All 6 of the Spirit River licences were located in the company’s Alberta Deep Basin asset, while the Montney licences were split evenly across Tourmaline’s NEBC Montney Gas/Condensate play area.
• All 37 of ARC Resources’ licences this month targeted the Montney. The licences were concentrated across 4 clusters within the company’s Sunrise and Greater Dawson assets, both of which are among the company’s most productive areas.
• Teine obtained the fourth-most licences this month, with 26 targeting the Viking formation. 28 licences were located in the Kindersley area with the remainder located near Carrot Creek in the company’s Duvernay holding.

Licensees	Count
Cenovus Energy Inc.	58
Tourmaline Oil Corp.	38
Arc Resources Ltd.	37
Teine Energy Ltd.	30
Baytex Energy Ltd	26
K+S Potash Canada General Partnership	23
Nuvista Energy Ltd.	17
Petronas Energy Canada Ltd.	17
Spur Petroleum Ltd.	16
Whitecap Resources Inc.	13
Others	261
Total	536

Top Producing Formations

• The Montney was the clear favourite among producers once again in the July-August period, with this month’s top formation being targeted with more licences than the next 3 formations combined. The BC Montney plays were particularly busy, with 111 BC Montney licences being obtained compared to 34 in Alberta. Top licensees include ARC Resources (37 licences), Tourmaline (32 licences), Nuvista (17 licences) and Petronas (17 licences).
• Compared to last month, there were more than twice as many licences obtained in the Cardium between July 13 and August 12. These licences were split between 9 different producers with Bonterra (9 licences) and Petrus Resources (8 licences) standing out as the most active licensees. Peyto Exploration’s licences, all located in the company’s Deep Basin asset, stand out relative to the other Cardium licences last month; the company’s 5 licences are quite far west of any other Cardium licence obtained during the period.
• The Clearwater saw significantly less activity this month, although it remained in the top 5 most-targeted producing formations. As has consistently been the case as of late, Clearwater licensing activity was dominated by Spur Petroleum (16 licences), Headwater Exploration (8 licences) and Tamarack Valley (4 licences) with a single ConocoPhillips licence thrown in for good measure. Headwater, who have added 63 sections of Clearwater land so far this year, have licensed consistently in this play over the past few months and have allocated capital to an expanded 2023 drilling program. Also keep in mind that Baytex often licenses its Clearwater wells under the Spirit River producing formation, and there were 14 such licences this month.

Top Producing Formations	Count
Montney	145
Viking	60
Cardium	38
Mcmurray	32
Clearwater	29
Prairie Evaporite	23
Spirit River	22
Waseca	19
Sparky	15
Duvernay	11
Others	142
Total	536

This analysis was performed with BOE Intel. To find out more or to arrange a demo, contact us.