Statoil announces estimates for oil 500 km off N.L.

Ashley
Ashley Fitzpatrick
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About 500 kilometres northeast of St. John’s, in rock that starts about 1,100 metres below the surface of the Atlantic Ocean, there are hundreds of millions of barrels worth of light, sweet oil.

Geir Richardson is the vice-president of exploration for Statoil.
— Photo by Rhonda Hayward/The Telegram

Statoil announced in August a well drilled at the prospect area known as Bay du Nord, in the Flemish Pass Basin, struck oil. On Thursday, the company announced its first estimate of just how much.

The oil company says the find is between 300 million and 600 million barrels recoverable. Its drilling partner Husky Energy (with 35 per cent interest) pegged the number at 400 million in its own announcement.

The difference in the numbers was attributed by a representative for Husky to regulatory requirements in where the companies were reporting, rather than any difference of opinion. The numbers come after the completion of a sidetrack from the well, providing more information on the find.

Both companies have trumpeted the news, calling it a landmark for oil exploration offshore Newfoundland and Labrador.

“This is Statoil’s biggest oil discovery outside Norway ever,” said Geir Richardsen, vice-president of exploration for Statoil Canada, in an interview at the company’s offices in downtown St. John’s.

“I believe it’s very important for the province of Newfoundland and Labrador, but it’s also pretty important for us as a company. It is a milestone in our development as an international company,” he said. “Great news.”

Along with Bay du Nord, Statoil has a discovery at its Mizzen prospect, about 20 kilometres away and estimated at 100 million to 200 million barrels. The company has also discovered oil at Harpoon, about 10 kilometres from Bay du Nord. A first estimate on the Harpoon discovery has yet to be determined.

“Cumulatively, these three Flemish Pass discoveries to date are significant,” said Asim Ghosh, CEO of Husky Energy, who spoke with The Telegram from Calgary.

Ghosh said the finds are collectively proving a hypothesis held by staff with Statoil and Husky of a hydrocarbon system in the ground beneath the deep waters of the Flemish Pass.

The find does not mean an offshore oil development will happen tomorrow, or even in the next decade. Statoil has promised further exploration and delineation work at Bay du Nord and has stated a producing development in the Flemish Pass may come post-2020.

afitzpatrick@thetelegram.com

This is a corrected version

Organizations: Statoil, Husky Energy

Geographic location: Newfoundland and Labrador, Norway

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  • Michael
    September 27, 2013 - 11:37

    600 million barrels of oil at $100 a barrel equals 60 billion. Subtract 10 billion for development costs and there is 50 billion left. The Newfoundland government will get roughly 30% of that which equals out to 15 billion dollars. Why on earth do we have all these whiners, moaners and complainers crying about this great news? Besides the royalties, corporate taxes and equity payments, each development in our offshore will create about 1000 long term direct jobs, onshore and offshore. Between Hebron and this near future Bay du Nord development, we are talking about 2000 high paying steady jobs!! More indirect jobs will also be created. I always hear people complain that oil revenues are creating haves and have nots, but before the oil finds we also had haves and have nots in Newfoundland. Things haven't really changed at all! But oil money is helping Newfoundland keep taxes lower, university tuitions low, infrastructure from crumbling, giving discounts to seniors, and hopefully bringing our economy and technology up to first world standards. Where would we be without it? Would you want to have a 20 billion dollar debt? A HST of 15% or more! Or an electricity bill that you couldn't pay for! That is where we would be! Newfoundlanders are well known to be some of the friendliest and most optimistic people in Canada, so I think we should embrace this great news and look forward to the future.

    • Maria
      September 29, 2013 - 07:30

      For you to imply that poverty is a given here in Newfoundland is both callous and naive but then to go on and insinuate that we should embrace it because we are a nice people is nothing short of patronizing, senseless mockery. Shame on you sir. Shame on you.

  • Tim Jamison
    September 27, 2013 - 11:02

    More money, more people, more construction, higher average wage. Excellent news. Better economy, better lives for all of us. And the reason he said "light, sweet oil", Gerard, was to indicate the lack of H2S and the ideal viscosity of the oil, which will make it easier and cheaper to extract, resulting in more money for everyone

  • Gerard Neil
    September 27, 2013 - 09:18

    "there are hundreds of millions of barrels worth of light, sweet oil" SWEET oil?! holy crap are you ever sucked into the trap. this amount of oil will last the world about a week (at the 2011 rate of 88/day), but the "excitement" will keep our housing market from crashing like it ought to, and our prices will increase for food, rent, etc., even though nothing changes in terms of jobs. shame on us for our closed minded-ness, our narrow mindedness and our lack of vision. does anyone see that there are studies out today saying we are causing the climate change with our use of OIL?!?! SWEET? go drink a cup

    • Robert
      September 27, 2013 - 19:59

      The problem being that for the foreseeable future what is the alternative? In a few short weeks winter will most certainly show up as usual here on the Rock and you/we will turn on some form of heat and consume energy. It has always been that way!

    • Phil
      October 01, 2013 - 09:23

      That's the way it works. Each field all over the world contributes to the energy we all use and need including you!

  • Bob
    September 27, 2013 - 04:27

    "1,100 kilometres below the surface of the Atlantic Ocean" - someone needs an editor to catch that. change kilometres to metres and it'll be correct.