Community Consultation - part 1 Folks, here's some interesting Q & A from some of the Husky presentations in April. I'm encouraged.
Question: How do you compare the Canol shale play to the Bakken play (in North Dakota)?
Response: The Canol is a very different shale; it is very thick. There is reason to believe that
the Canol shale is the best shale resource in the world.
Question: Why did you use oil first and now switching to a water frac?
Response: Using oil is not appropriate on a commercial scale. We are planning for small water
fracs on these two vertical wells. Oil gave us enough of a sample in our short winter timeframe
but going forward the most economical method is with water for the 2 vertical and horizontal
wells.
Question: Is there a lot of oil an gas reserves out there?
Response: Yes, we are encouraged. There is a lot of reserves out there – oil, gas, LNGs
(liquid natural gas).
Question: What did you mean when you mentioned in your presentation that an environmental
assessment (EA) could mean significant delays to your exploration?
Response: Everything presented in the timeline to get to production ten years from now means
that everything has to work perfectly. If this gets referred to an EA that could put a stop on our
exploration for 2-3 years while it is in the EA process. That means no work coming to the
communities and contractors. Meanwhile, our management could decide that it is not worth the
lost time and put their money elsewhere in a different exploration area. The other thing that
companies are limited by is the term of an exploration licence (EL). Our ELs (EL462 and
EL463) have a 5-year term where we are obligated to spend the dollar amount in our work
commitment without penalty. Husky has already drilled two wells which allows us to proceed to
Term 2 of the EL but throwing an EA into the mix, which could take 2-3 years, could also cause
Husky to incur a financial penalty.