Province boosts marine base development project

Daniel MacEachern
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Half a million dollars added to Pennecon Energy expansion

A welder works on Pennecon Energy's new dock. The provincial government announced Thursday $500,000 in funding for the project, which is expected to be completed in October. Photo by Daniel MacEachern/The Telegram

Pennecon Energy's Marine Base in Bay Bulls received $500,000 Thursday from the provincial government.

Business Minister Derrick Dalley announced the funding, which will be used for a $2.1-million expansion project at the facility, which services the oil and gas sector. The funding comes two days after the federal government announced a $1-million loan for the project.

"It's a great boost to helping us get forward with future plans at the base," said Don Noseworthy, senior vice-president of Pennecon Energy "We're going to be able to expand the capacity probably 30 per cent beyond where we are today, and it really helps us with the flow of traffic and accommodating that work opportunity."

Dalley was similarly optimistic about the potential for increased business.

"With the opportunities on the horizon in Greenland, with exploration and drilling taking off in that region, as well as with the potential for Arctic development, we certainly see into the future that we're optimistic a lot of this business, particularly in the service and supply sector for the oil and gas industry, will come right here to the province. And Pennecon has a tremendous facility here. They put a lot of time and effort in here. They've got a great staff here, and they're certainly positioned to be able to take advantage of that work, so it's a great time to do this. With developments on the horizon, we certainly want to position the province to take advantage of it."

Construction of a third dock is already underway at the base, which is expected to be completed in October. The expansion is expected to create 15 new full-time jobs over the next three years and 23 permanent full-time jobs by 2015.

"Our workforce here varies. It's been anywhere from 30 to 100 depending on the work opportunities that we have at the pier at the time," said Noseworthy. "It depends on the trans-shipping of the product, and refitting of rig work, fabrication as well, so it's up and down."

Noseworthy said the third dock will help Pennecon handle increasing business from northern oil projects.

"It's the vision looking towards the future of other developments, such as Greenland, the Canadian Arctic, and things that we know of right now. We have some projects in hand, but the growth that we see that's possible, similar to what we saw in 2000 when we started the projects here, (we're) looking forward to the next 10 years and 20 years, to be able to handle that work," Noseworthy said.

The funds are coming from the government's Oil and Gas Manufacturing and Services Export Development Fund, designed to support new business opportunities for large export-based petroleum fabrication, manufacturing and service operations. Noseworthy was asked why Pennecon didn't fund the expansion itself instead of taking taxpayer money.

"Well, the opportunity is there to support local industries, ourselves and others, and that opportunity is something that we have been reviewing with the government and consultants helping us look at that," he said. "This site is sort of a multi-purpose site; it's there for other purposes as well. It seemed to fit well and it follows the intent of the provincial government, and we welcome it with open arms."

Dalley said there were several reasons to invest money from the fund.

"One is that the oil and gas industry is extremely important for the province. It's a growth sector, and as a government we certainly feel a responsibility to support that industry where we can," he said. "Secondly, Pennecon is a very well-established company in this province. They're a tremendous employer. They certainly add to the economy in a number of regions and particularly in this area as well. ... I think it's important as a government and a department that we recognize companies that are here for the long term, that have made significant investments, that have great contributions to the economy, that are great employers. As a government we want to support them where we can. And certainly thirdly, to be able to make an investment in the rural area of the province, in the Bay Bulls area. It gives us a great opportunity to support the people in this region as well."

Dalley also said the announcement has nothing to do with the upcoming provincial election in October.

"This is not about an election. We've been working on this project for some time. My staff at the Department of Business (has) several applications before us, coming at different times of the year. We do due diligence, a very thorough process as we work through these projects, and it just happens we're at a stage where we got our work completed, and now's a good time to get this out the door."

In response to a question about the increasing noise in a shipyard that goes with increased business, Noseworthy said Pennecon will continue to work closely with the community and meet with council and residents.

"We respect their desires, and I think we've co-habitated with the tour groups and the fish farms, so it seems to be working well," he said. "We take all those opportunities for improvement and work on them." Twitter: TelegramDaniel


Organizations: Pennecon Energy, Canadian Arctic, Oil and Gas Manufacturing and Services Export Development Fund Department of Business

Geographic location: Bay Bulls, Greenland, Arctic

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