Natural Resources
February 2, 2007

Hibernia South Decision Should Not Delay Approvals

The Provincial Government sees no reason for the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB) to suggest approvals may be delayed over the province�s rejection of the development plan for Hibernia South.

"We disagreed with the approach of the board in the case of Hibernia South, but that does not mean the board can�t proceed with other assessments and decisions," said the Honourable Kathy Dunderdale, Minister of Natural Resources. "The board can still impose conditions as a tool in approving fundamental decisions."

In a letter posted publicly on its Web site Thursday, the board defends its Decision Report on Hibernia South in light of the province�s rejection of the application. The letter also states that, "as a general rule, delaying production erodes value, whereas accelerating production enhances value."

"This government will not make decisions based on short-term gains," the minister said. "We agreed with the board that information was lacking. We differed as to the approach for getting that information and at what stage approval should be given. We will not rubber stamp decisions of the board. We are not willing to give approval until we have all the information necessary to make a decision that is in the best interests of the people of the province, which is within our legislative authority to do so."

In the past, fundamental approvals have been given with conditions attached and this is a useful mechanism when used appropriately. In the case of Hibernia South, however, the province feels the outstanding information being sought by the conditions was too significant to be covered in that way and therefore rejected the application.

The minister said a critique by the board of the province�s decision is highly unusual and outside the board�s role as regulator.

"For the board to question our need to be provided with more information on which to base our decision on the development of a resource that belongs to the people is quite frankly inappropriate," the minister said. "The board is subject to the review of the federal and provincial ministers. The ministers are not subject to review of the board."

The minister has met with representatives of Hibernia Management Development Company (HMDC) and they have indicated they are prepared to provide the province with the information it has requested to make a well-informed decision on a new application.

The minister�s written response to the board can be found at � www.gov.nl.ca/releases/2007/nr/0202letter.pdf

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Media contact:
Tracy Barron
Director of Communications
Department of Natural Resources
709-729-5282, 690-1703
tracybarron@gov.nl.ca

2007 02 02                                             4:25 p.m.
 


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