Ontario Gas Play

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In December 2007 I put together a bidding group to bid on 21,000 acres of oil and gas leases located in southern Ontario, Canada.  The leases were only a few miles north of  Lake Erie.  The play was natural gas as Toronto was paying a premium for all the gas they could get to supply their needs.  There were only a few bidders that came to the auction.  The bidding process started off fairly with everyone throwing in a bid but as it moved up was narrowed down to only two bidders – my group and one other.  Our strategy was to counter quickly every time they increased their bid.  They were not as eager to increase their bid so as our aggressive bidding made them cautious.  We were the successful bidder to acquire the 21,000 acres of oil and gas leases.

It was a different area to work compared to what we were used to here in Texas.  Most all of the leases were 87.5% leases, basically the standard 1/8th lease to the mineral holders.  It is very hard in Texas to get an 87.5% lease.  Now it is very common to get 75% leases.

Having favorable lease terms coupled with Toronto paying a premium for the natural gas made it a very interesting project.  The area is covered with gas pipelines, making marking the gas fairly easy.

We started evaluating each of the leases and began identifying the best drill targets during the spring of 2008.  We began marketing the prospects and before we knew what was happening the whole world went upside down and energy prices collapsed.  We held on as long as we could hoping for the prices to recover and ended up letting the leases expire.

We are keeping an eye on this gas play as it is a very interesting low risk project well worth pursuing once gas prices improve.  Today’s natural gas prices are still soft trading at less than $3.00 per MCF.


ABOUT THE FOUNDER

Ivan Webb is known in the Petrol industry as a self-starting change initiator motivated by fresh ideas. His first oil deal dates back to the days of the LBJ Presidency; when Willie Mays and Hank Aaron were still active baseball players. Since then, Ivan Webb has lived through countless swings in the price of oil and gas as well as numerous advancements in oil extraction technology.

IN the past 10 years, he has helped drill 30 wells, including 7 of our own, which were producing on our own behalf.

From the 70’s to the 90’s, he was instrumental in leasing oil and gas concessions in Australia, Guyana and Turkey before narrowing his efforts into producing wells in the Central Texas region. One of areas of expertise has been in finding existing wells in that region. These are wells that may have shut down as they hit their production limit in years past but can be re-completed and reworked to a far greater capacity using the tools of today.

Ivan is currently managing Northern Minerals & Exploration LTD, a public company dedicated to growing investments in the Oil, Gals, Gold & Silver Industry as well as the Founder & President of Kathis Energy.

Ivan Webb