The search for oil has been forefront in the minds of explorers in Atlantic Canada for almost 200 years. The first oil seep was seen at Parsons Pond in 1812 on Newfoundland’s West Coast. Onshore drilling began in Atlantic Canada in 1867 and the first offshore wells were drilled in the 1940s. The first offshore project in Atlantic Canada was Cohasset Panuke, discovered in 1973 off Nova Scotia. It produced oil from 1992 – 1997.
By the end of 2017, East Coast Canada will have five producing oil & gas projects. Information about these is contained in the Offshore Projects section of this website.
Exploration of our offshore continues to be a priority for Newfoundland and Labrador and, despite current low oil prices, activity remains strong. Since the Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB) instituted its scheduled land tenure system in 2013 and Nalcor Energy began strategic offshore data acquisition/analysis and the commissioning of independent offshore assessments, the province’s offshore prospectivity and global competitiveness has increased.
In October 2015, prior to the close of the 2015 offshore land sale, Nalcor Energy released the results of an independent resource assessment of the licensing area which revealed “in place” potential of 12 billion barrels of oil and 113 trillion cubic feet of gas. This area, which covers only 1.6 per cent of the province’s offshore basins, received $1.2 billion in work commitments and brought three new players into the local industry. This was the highest value the province had ever received in an offshore sale.
In January 2016, the C-NLOPB issued seven exploration licences for the parcels of offshore land sold in the 2015 land sale.
Similarly, in 2016, the results of an independent resource assessment of the area offered for sale that year – which covered approximately two per cent of the province’s offshore area – showed 25.5 billion barrels of oil and 20.6 trillion cubic feet of gas potential. As well, a new lower tertiary play trend was identified. Over $750 million in work commitments was received for eight land parcels and three new players entered the local industry. This value was especially significant given that global land sales were very disappointing in 2016.
In early 2017, the C-NLOPB issued eight exploration licences for the land purchased in the 2016 land sale.
In total, seven new exploration and production (E&P) companies have entered the Newfoundland and Labrador oil & gas industry since the release of the 2015 offshore resource assessment. Oil & gas assessments will continue to be carried out in advance of future licensing rounds.
For further information about East Coast Canada offshore activity anticipated in 2017, read “2017: The Look Ahead” on page 6 of our first quarter issue of Noia News online.