March 20, 1997
(Mines and Energy)

Budget reflects commitment to develop natural resources

Rex Gibbons, Minister of Mines and Energy says the departmental budget which is set for approximately $8 million reflects the government's commitment to develop natural resources and maximize benefits to the province.

"The mining, petroleum and energy industries are expected to contribute significantly to the provincial economy in the future,� says Gibbons. "The government is establishing sound priorities in this budget to reflect our long-term commitment to develop our natural resources and ensure the province and its people receive maximum social and economic benefits."

Budget highlights for the 1997/98 fiscal year include:

• - Prospectors Assistance Grant Program will remain at $76,000. The program, which has been in effect since 1988, provides residents of the province with grants to assist with exploration costs. The program's aim is to encourage the development of a strong independent prospecting sector.

  - The Geological Survey Division will participate in an increased field program with an emphasis on the Labrador portion of the province.

  - All regional Mines� offices will be maintained. This will include the offices in Wabush, Pasadena and Happy Valley-Goose Bay.

  - Restructuring in the Geological Survey Division will maximize the efficiency of the division's resources and retain its core programs, especially the geological mapping program in Labrador, mineral deposits assessments throughout the province, and in the provision of enhanced geoscientific data bases to the mineral exploration sector.

  - The Petroleum Projects Monitoring Division's budget will increase by 26 per cent from $400,000 in 1996/97 to $502,500 in 1997/98. With the province entering a new phase in the development of its oil and gas industry, there is an increased demand on the services of this division which is responsible for ensuring the province receives its rightful share of revenues from its resources. The additional revenues will pay for a full complement of auditors and research analysts for the division.

  - As a cost recovery initiative, industry is re-imbursing the province's share for the cost of the Terra Nova Public Review. This review is being implemented by the Canada-Newfoundland Offshore Petroleum Board (CNOPB), and the estimated cost of the review in the 1997/98 fiscal year ($300,000) is shared 50/50 by the provincial and federal governments. Industry will reimburse the province�s share of $150,000.

The restructuring being undertaken by the Department of Mines and Energy and government will make government more affordable, efficient and effective. All activities of the department and its mandate were reviewed. Decisions were made based on the need to maximize the use of our resources to help restore stability to the Department and in turn economic stability to the provincial economy.

Contact: Tara Laing, Assistant Director, Communications, (709) 729- 4890.