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    Questerre Pushes Back Against Quebec Frack Ban


Proposed ban overshadowed a strong second quarter.

by: Dale Lunan

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Questerre Pushes Back Against Quebec Frack Ban

Questerre Energy said August 10 the Quebec government’s surprise ban on fracking announced in early June overshadowed what was an otherwise strong second quarter for the company.

The ban, announced in the midst of a provincial election campaign, could impact Questerre’s efforts to develop its extensive Utica shale gas assets in Quebec’s St. Lawrence Lowlands, which cover some 753,000 net acres and hold a contingent shale gas resource estimated at some 5.8 trillion ft3.

The fracking ban, CEO Michael Binnion said, “blindsided us”, coming as it did just hours before the company’s annual general meeting in Calgary. But Questerre is aggressively fighting the proposed regulations, Binnion said.

“We recently filed a brief with the government strongly objecting to this decision,” he said. “Specifically, we have made the case that the proposed regulations are neither well drafted nor legally within the power of the government.” 

Questerre hopes to hold “meaningful consultations” with the Quebec government before the regulations are finalised, Binnion said.

“We suspect this announcement was made solely for the upcoming election because it directly conflicts with the extensive environmental studies on hydraulic fracturing conducted during the Strategic Environmental Assessment, the letter and intent of the hydrocarbon legislation enacted in December 2016 and the government’s own published guidelines on social acceptability,” he said. “Most importantly, it runs contrary to the recent polling data [showing] 60% of Quebecers support local natural gas development.”

Second quarter results, meanwhile, show net income of C$572,000 (US$436,000) against a loss of C$3.62mn (US$2.76mn) in 2Q 2017, largely reflecting increased production and improved economics from Questerres liquids-rich Kakwa gas assets in Alberta’s Deep Basin. Natural gas production averaged 4.06mn ft3/day in 2Q 2018, up from 2.77mn ft3/day in the comparable period last year, while oil and gas liquids production nearly tripled to 1,340 b/d from 576 b/d.