Premier Kathy Dunderdale
NOIA Conference 2013 Keynote Opening
Tuesday, June 18, 2013
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Government Investment in Nalcor Oil and Gas
and early this morning, I am delighted to kick off the 2013 conference of
experiencing a great momentum right now in
is a time of tremendous excitement, growth and transition in
Just five months ago, on the 4th of January, we welcomed the announcement by ExxonMobil that they have sanctioned the development of the Hebron Project.
months later (on March 11), I attended the cutting of the first steel for
months after that (on May 14), at the Cow Head fabrication facility in
Marystown, it was the cutting of the first steel for the
Then, just weeks ago (on June 5), the Canada-Newfoundland and Labrador Offshore Petroleum Board announced approval of the development plan amendment for the South White Rose Extension tie-back project.
White Rose project is an example of how growth is occurring in our offshore.
White Rose produced first oil in 2005. Its satellite field, North Amethyst –
indeed, the very first satellite field development in the Canadian offshore
– pumped first oil in 2010. Three years later, we have the green light for
the White Rose Extension tie-back project – a clear sign that
Husky and its partners are also evaluating options for further development in the West White Rose.
are exciting times in our industry; indeed in
Have no doubt: our direct investments as a province in the growth of our oil and gas industry are proving to be, not just sound choices, but truly inspired choices.
Is it any wonder people are excited about new growth in this industry!
was at the Offshore Technology Conference in
Opportunities abound. Projects are moving full-steam ahead. Skilled workers are knuckling down. Thanks to our ground-breaking agreements on gender equity, more of those workers than ever before are women. New graduates are gaining the qualifications and certifications they need to join the labour pool and meet the rising demand. The dividends from our investments are returning. Communities are thriving. All of us are benefiting.
Let no one be misguided into thinking the momentum we are experiencing in our oil and gas industry was inevitable or easy to achieve.
You know the difference.
You know that every achievement we celebrate today was hard-fought and is a testament to the power of confidence, courage and commitment.
This room and this industry are full of people who are not afraid of a challenge but prepared to do whatever is required to get from point A to point B. The contributions of those gathered in this room today and companies throughout our industry are immense. You have a drive, a determination and an innovative spirit that is not only admired, but shared and celebrated by your government. I am excited to continue to work together with you to continue to advance our industry. The time has never been better to fortify our partnership and move forward together.
Globally, engineering and production companies have a finite pool of
investment dollars. To lure those exploration dollars to
We do need to be mindful, however, that not just here, but everywhere, the search for new discoveries is a risky undertaking.
We can minimize risks by maximizing certainty.
But just how do we do this?
The leading petroleum jurisdictions in the world are minimizing risks by maximizing knowledge. They ensure they have the best available information at their fingertips before making any decisions.
For governments, publicly traded companies and smart investors, good information is the foundation for sound decision-making – in the oil and gas industry, just as in other industries. Intelligence makes all the difference in the world.
You can never eliminate risks, but you can rein in the variables by doing your homework.
That powerful insight is leading us to change our approach.
needed to demonstrate that
And, we needed to give companies an adequate window of opportunity to get in on the action.
Let me deal first with the need to identify the most-promising plays.
This is crucial. The prospectivity of a region is central to its ability to attract investment in its offshore.
Prospectivity is assessed through a rigorous scientific process based on
high-quality, globally-competitive datasets.
world’s leader in promoting prospectivity –
the last couple of years, we as a government have been applying
government since 2010 has funded $30 million towards Nalcor Energy’s
geoscience programs to gather more seismic data. We invested over half of
that funding in a three-year 2D seismic program that extended from the
Labrador Sea in the north to the
investment has leveraged nearly $65 million in investment from leading
global seismic companies TGS and PGS for exploration in
only is this acquisition of 2D seismic data the largest program by area in
the history of
By the end of 2013, Nalcor will have access to 50,000 line-kilometres of data, spanning an area larger than the U.S. Gulf of Mexico.
Approximately 70 per cent of the area covered by these surveys had no previous seismic data. The new data are revealing structures never before seen.
With the data in hand, we have been determining “in house” where the potential likely resides.
investment is the most strategic we have ever made in our oil industry. It
changes fundamentally the way we sell ourselves to explorers and serves as a
catalyst in identifying the next big finds that can propel our industry
beyond the limits of current projects.
already seeing early results from our exploration strategy. Earlier this
year, Nalcor announced the discovery of three new large basins in offshore
marking a new era in the oil and gas industry in this province - we are
proactive rather than responsive. We are securing new investments for the
because of these strategic decisions, Nalcor is projected to be fully
self-sufficient in oil and gas investments as early as 2015. That’s two
2. SCHEDULING LICENCE ROUNDS
Getting the seismic data to prospective exploration companies is just half the challenge. The other challenge is finding a fair and competitive way to handle the licensing of parcels to them.
That challenge is compounded when the process is nomination-driven. When new companies have as little as seven months to decide, not only if they should enter a region, but what their bids should be, they feel like they are doing business blindfolded and under the gun.
It is crucial to provide ample time for companies to access and assess the data, make plans for exploration, and then submit competitive bids according to those plans.
By revising the way we schedule licence rounds, we can widen the window, promote exploration and ultimately spur drilling of the new wells we definitely need.
is precisely what we are doing. With knowledge of our
Nurturing a predictable and structured market for our prospective offshore
lands will benefit all participants – governments, oil companies, seismic
companies, regulators and ultimately the people of
Because of our timely investment and strategic work to move towards
scheduled licensing rounds in our offshore, exploration drilling off
These are exciting times!
We are confident that we have the resource potential for significant expansion beyond the life of our existing projects.
seek new fields, we are also continuing to seek new players, testing new
ways to attract more participants to our offshore.
But we are not going to stop there. This is just the start.
We are not just being proactive and driving opportunities here at home either. We are leaders on the national and international stage as well.
with the premiers of
province is directly involved in shaping the course of these discussions,
and I as Premier will ensure the strategy we design will enable our province
to reach its fullest potential as an energy leader in
afternoon, I will lead a delegation representing our province to
These are companies with capital to invest and a very real interest in exploring and bringing new finds to market.
very excited about bringing them this news and inviting them to join us in
expanding this province’s offshore oil industry
We have an amazing story to tell.
How far we have come! Where once we were the laggard of Confederation, we are now a leader.
development is transforming
Thanks to the approach we have taken and the decisions we have made, we are on the right track, sharing enormous benefits and on our way to even more.
When the course we chart is sound, all of us can be winners.
Thanks to careful strategic planning, our “new energy” economy is surging forward, stride after stride, taking us to milestones that few imagined we would ever reach.
Future generations will look back and see this era in our history for what it truly is – pivotal – and they will appreciate our commitment to making the best decisions in our long-term best interests.
The morning is still young. The sun is still
low in the sky and rising.
Let us get out there and make the most of every opportunity.
Let’s hit the ground running and not look back!Thank you.