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April 22, 1997
(Mines and Energy)


The following statement was issued today by Premier Brian Tobin. It was also read in the House of Assembly:

Mr. Speaker, I am pleased that Mobil Oil Canada, Chevron Canada Resources, Petro-Canada and Norsk Hydro Canada Oil and Gas have announced their plans to drill a delineation well in the Hebron area of the Grand Banks, three kilometres northeast of the Hebron I-13 discovery well.

With this announcement today, there will be two wells drilled and a seismic survey completed on the Grand Banks in 1997.

Mr. Speaker, this is tangible and concrete evidence of increased confidence in the oil and gas sector in the province. The announcement today of this new Hebron well further supports our belief that there are more oil and gas resources to be discovered on the Grand Banks. Companies are once again enthusiastic about our offshore petroleum resource potential and are taking steps to discover more oil and gas.

This is the first time in over five years that oil companies will drill exploratory wells on the Grand Banks. We are seeing a renewed interest in the Grand Banks, because of the development of Hibernia and Terra Nova oil fields - and because of our Offshore Generic Royalty Regime last June. The Regime which has been well received by the oil industry provides certainty for companies interested in further exploration.

Mr. Speaker, I am also pleased with the other Grand Banks exploration plans which have been previously announced by Amoco, Husky and Petro-Canada.

These include Amoco Canada's intention in May 1997, to drill the West Bonne Bay prospect, approximately 15 kilometres northeast of the Terra Nova field, using the semisubmersible Bill Shoemaker drilling unit. This well will be drilled on the acreage on which Amoco bid $90.3 million for in 1995.

The Bill Shoemaker unit will also be used to drill the new Hebron well. The well will be spudded sometime in September, and Petro-Canada will operate the well on behalf of all participants.

As well Mr. Speaker, Husky Oil - acting on behalf of a ten-company partnership that includes Husky, Petro-Canada, Chevron, Gulf, Murphy, Mobil, Talisman, Parex, Norsk-Hydro and Mosbacher - selected PGS Exploration, a subsidiary of Petroleum Geo-Services ASA, to conduct a major 3D marine seismic survey on the Grand Banks, commencing in May 1997. This program will cover an area of approximately 1100 square kilometres and is the largest seismic survey of its kind, ever conducted offshore Canada.

In addition, Petro-Canada recently stated they have future plans to drill the Riverhead prospect, one of the larger undrilled prospects located on the Grand Banks. Petro-Canada and its partners Mobil and Chevron successfully bid $64.9 million in work expenditures in the Canada-Newfoundland Offshore Petroleum Board's 1996 Call for Bids to secure the Exploration Licence which contains the prospect.

Present estimates set discovered recoverable resources in the Jeanne d'Arc Basin at approximately 1.6 billion barrels of oil and four trillion cubic feet of natural gas. It is also estimated that another five billion barrels of oil resources are yet to be discovered.

Mr. Speaker, I am delighted to see the activity being generated in the exploration sector. In the oil and gas business, successful exploration, and development programs based on sound economics, are a requirement before employment and revenues can be generated through production.

1997 04 22 2:30 p.m.

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