The federal government may be doing what it can to discourage any further development of fossil fuel production but the marketplace seems to be on a completely different page.
The provincial government has just completed the third of six auctions for drilling rights. And it generated $16 million this time round. That brings the total for the midpoint of this fiscal year to more than $37 million.
That’s roughly double the $19 million the finance department expected when it tabled this year’s budget. And its considerably higher than last August’s sale where bids valued at $6 million were offered by industry players.
More than half of this year’s bid value was for properties in the southeast, notably around Estevan. The Kindersley region drew about one-third of the revenue for the province.
These numbers are an important bellwether offering some insight into the mood of the industry. Over the past few years, bidding activity was more subdued but now, even with flat or lower oil prices, the industry remains bullish and willing to make long-term investments in future production capacity.
