The Quebec government and oil company Pétrolia Inc. have come to an agreement in principle over the cessation of all oil and gas exploration work on Anticosti Island. The agreement follows an order by Quebec Energy and Natural Resources Minister Pierre Arcand prohibiting oil and gas exploration and development on Anticosti Island and $41.4 million in compensation to three of five companies with exploration rights on the island.
Pétrolia is the fourth company to come to terms. It holds a 21.7%-interest in the Anticosti project, and has accepted $20.5 million in compensation in return for the cessation of all work, the end of the exploration program, the termination of the operator contract held by its subsidiary, Pétrolia Anticosti, and the preparation and execution of an approved well closure program.
The agreement in principle is still subject to the conclusion of a definitive agreement.
Settlement with Pétrolia leaves only one holdout, TransAmerican Energy Inc., which since 2010 has held a 100%-interest in a 7,916-hectare shale oil and gas prospect on the island. Discussions continue between that company and the Quebec government. According to its SEDAR filings, in the year ended April 30, 2016, TransAmerican Energy wrote down the value of property to one dollar.