Gulf gets access to 800,000 acres on the Fort Peck Indian Reservation

Dec 10, 1996 01:00 AM

Gulf Canada's expanding US land position grew significantly with the recent signing of an agreement with the Assiniboine and Sioux Tribes of Fort Peck, Montana. The mineral development agreement initially provides Gulf with access to approximately 800,000 acres of tribal and non-tribal land in the 2.1 mm acre Fort Peck Reservation on the western slope of the Williston Basin. The agreement also provides Gulf with an option to expand the program to cover the balance of the reservation. The tribes contribute 110,000 acres of tribal land; Gulf contributes approximately 60,000 acres it currently has leased and will provide the capital necessary to acquire additional non-tribal lands to bring the total area covered by the agreement to approximately 800,000 acres. Gulf will act as the exclusive contractor within the mineral development area, and also will put up all of the capital required for seismic, drilling and development, and any future production facilities that are required. The agreement, calls for a minimum of 80 square miles of 3D seismic and at least four exploratory wells to be drilled within five years. Gulf plans to begin a 60-square-mile seismic program in the first quarter of 1997 and to drill up to two wells before year-end 1997. The minimum initial investment is expected to be approximately $ 6.5 mm. The tribes will assist Gulf with exploration planning and implementation, and receive 20 per cent of net revenue (after operating expenses) from all of the production from all of the lands - both tribal and non-tribal. The agreement also provides for education and training for tribal members, local employment opportunities and increased tribal participation in the future if the tribes so choose.

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