Oil still king in N.L.
Little talk of climate change as government promotes drilling
The Government of Newfoundland and Labrador is not shying away from promoting oil drilling for revenue, regardless of any related concerns around carbon emissions.
For years, money has been transferred to Crown corporation Nalcor Energy to assist with oil project equity stakes and to pay for data collection and, as of Thursday, detailed modelling to produce targeted resource estimates.
Assessments are to be produced ahead of exploration licence sales, to encourage bidding, year after year.
“And that will go on forever and ever and ever, until we have the 1.5 million square kilometres done of the offshore,” said Nalcor Energy president and CEO Ed Martin.
“As we all know, (oil) drives our economy here in Newfoundland and Labrador. It creates business opportunities. It creates the requirement for supply chain. It creates jobs for Newfoundlanders and Labradorians,” said Premier Paul Davis, having just trumpeted the first of the planned science-based estimates.
It suggests roughly 12 billion barrels of oil in place, within an area covering less than two per cent of the province’s total offshore area.
In December 2014, a round of licensing by the Canada-Newfoundland and Labrador Offshore Petroleum Board brought in $596.7 million in total spending commitments, including the largest single bid in the history of the land tenure system.
The bid was by a partnership led by ExxonMobil Canada, including Suncor Energy and ConocoPhillips Canada. It committed spending of $559 million for exploration of an area of the Flemish Pass Basin.
Yet more recently, UN climate chief Christiana Figueres wrote to the world’s largest oil companies about “an orderly transition to low carbon forms of energy.”
A suggestion to keep identified fossil fuel resources in the ground has also gained traction along the way, promoted by authors such as George Monbiot, Bill McKibben and Linda McQuaig.
The latter, a journalist and NDP candidate for Toronto Centre, took some heat earlier this month after a taping of CBC’s “Power and Politics,” where she suggested some identified oilsands resources in Alberta might have to be kept from production.
Newfoundland and Labrador’s premier was not just rolling out a welcome mat to oil companies, but revealing information specifically purchased to incentivize spending here.
Alberta’s NDP premier has reportedly declared there is no long-term future in fossil fuels.
“So we can choose,” Davis said, when asked about the “keep it in the ground” arguments.
“We can decide we’re not going to be part of that (business). We leave the oil in the ground and walk away from it, or we capitalize (on demands) that exist globally. But at the same time, don’t forget, we’re using our oil revenues to transform our economy from a nonrenewable economy base through oil and gas to a renewable resource. And that’s the new (hydroelectric) development we’re doing through Muskrat Falls and through Churchill Falls and Churchill River development.”
He said his government’s con- versations with other Canadian premiers and New England governors have often covered a desire for transition to renewable energy sources, to bring all jurisdictions off heavy-emitting coal and oil resources.
The $7.65-billion Muskrat Falls hydro project will result in a shutdown of this province’s oilburning power plant at Holyrood, while allowing for export.
There has also been talk of an even larger, more expensive development at Gull Island, also on the Churchill River.
“But in the meantime, there’s a big demand for oil. We have the oil. Newfoundlanders and Labradorians benefit from that. Our economy benefits from that. We can choose to be in it or not be in it. We’re choosing to be in it,” he said.