A Canadian indigenous group said Monday it rejected Obsidian Energy’s (NYSE:OBE) proposal to expand drilling operations on its traditional territory.
The formal notice that the Woodland Cree First Nation nixed Obsidian’s (OBE) drilling plans marks a further breakdown in relations, after the group initially raised concerns in February about a series of earthquakes in their territory in northern Alberta in late 2022 and early 2023.
Obsidian (OBE) produces ~6.5K boe/day, or 20% of its total production, from assets in the Peace River region, some of which are within Woodland Cree territory.
Stifel analysts say that while the rejection would have little impact on Obsidian’s (OBE) short-term outlook, since the company already has well licenses in hand, it is not ideal for longer-term plans in the region.