Ottawa rules out extensions for oil firms

ARCTIC DRILLING

“Our understanding is they’ll have consultations and conversations with industry, in particular the licence holders, with respect to extensions,” said Paul Barnes, Atlantic Canada and Arctic manager for the Canadian Association of Petroleum Producers, the top industry lobby group. “We’re kind of anxious to have further discussions.”

Indigenous Affairs Minister Carolyn Bennett, who oversees Arctic oil regulation, has declined interview requests since the announcement. Bennett’s spokeswoman, Sabrina Williams, referred questions about extensions to the department.

When asked, the department didn’t directly address its online statement that extensions won’t be granted — saying companies are free to keep asking for them. “Should stakeholders raise licence extension issues during the consultations, the Government of Canada will take their feedback into account to inform next steps,” spokesman Shawn Jackson said.

There is no current offshore A Greenpeace campaigner says developing Arctic oil is at odds with Canada’s emissions reduction pledges. oil production or drilling in Canada’s Arctic, though exploration there dates back to incentives brought in by former prime minister Pierre Trudeau. Five companies hold exploration licences expiring between 2019 and 2023, all in the section of the Beaufort Sea that lies along the shores of the Yukon and Northwest Territories.

The Canadian leaseholders are BP; Imperial Oil Resources Ventures Limited, controlled by Exxon; ConocoPhillips Co.; Chevron Canada Ltd.; and Franklin Petroleum Canada Ltd. Two other exploration licences issued in the 1980s to Talisman Energy Inc., acquired by Repsol SA in 2015, and BP have no expiry dates. Trudeau’s government has said those companies are eligible to upgrade their licences in the event of a discovery, but initially referred to consultations when pressed on whether extensions will be allowed. Trudeau has pledged to review the moratorium in five years.

Of the outstanding exploration licences, Imperial’s were acquired at the highest cost — $1.8 billion in work bid commitments. Imperial said last month it had sought extensions for exploration licences “to ensure future oil and gas activities are conducted in an appropriately paced, safe and environmentally responsible manner.”

Alex Speers-Roesch, a Greenpeace campaigner, said developing Arctic oil is at odds with Canada’s emissions reduction pledges. “The government should ... pause all Arctic oil and gas projects until they have rigorous tests in place that assess whether these projects make sense in the lowcarbon world Canada championed in the Paris climate agreement.”