Four oil and gas companies could get exclusive lifetime exploration rights in N.W.T.

Four oil and gas companies are now poised to get the exclusive lifetime rights to explore a large swath of land nearly 4,000 square kilometres in the once-promising Canol shale south of Norman Wells.

Earlier this month, an expert panel tapped by the territory's oil and gas regulator, OROGO, confirmed that a well drilled and hydraulically fractured by ConocoPhillips in 2014 led to a "significant discovery" of hydrocarbons.

The decision paves the way for ConocoPhillips to acquire a significant discovery licence from Wally Schumann, the minister of Industry, Tourism and Investment. That kind of licence comes with no expiry date, meaning ConocoPhillips would have the exclusive rights to explore its parcel of land forever.

But, partly because shale oil deposits are known to extend over vast amounts of land, the expert panel decided that other companies with exploration licences covering parcels close to Conoco's Husky Energy, Shell and MGM Energy can now also immediatelyapply to Schumann for significant discovery licences.

A hasty decision?

Doug Matthews,an energy analyst and the former director of the N.W.T.'s oil and gas division, says the panel's all-in-one decision is hasty.

He says it putsthe fate of the Canol shale oil play in the hands of only a few companies at an early stage of the shale's development.

"A significant portion of the Central Mackenzie Valley is, for all intents and purposes, closed," says Matthews.

James Fulford, the executive director of the independent Office of the Regulator of Oil and Gas Operations (OROGO), says the expert panel calculated the size of the significant discovery area based on evidence provided by all the companies, including drilling results and seismic data.

ButMatthews says he's worried that once the companies acquire these exclusive licenses,the land will sit idle.

In March 2015, ConocoPhillips said it was not planning further work on its parcel for the foreseeable future.

• Despite discovery, ConocoPhillips not planning more exploration

"Although a significant discovery declaration and subsequent significant discovery licence is a positive indication for a play, it does not indicate commercial viability," said a spokesperson for ConocoPhillips at the time.