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ExxonMobil Keeps Leadership Position in Offshore N.L. Industry

offshore oil and gas project

According to the results of the last license bids, ExxonMobil, one of the world’s biggest oil companies, still dominates the offshore industry in Newfoundland and Labrador.

QPI Energy Canada, a subsidiary of Qatar Energy, and ExxonMobil have agreed to invest $181.6 million over the next six years to explore a parcel in the Orphan Basin that has a prospect called Heart’s Content.

The Orphan Basin is an underwater frontier region well outside Canada’s 200-nautical-mile exclusive economic zone.

“This new opportunity builds on our 25 years of success as lead owner of Hibernia and more recently as operator of the Hebron project,” said ExxonMobil spokesperson Margot Bruce-O’Connell. “We look forward to exploring this new area with our co-venturer, Qatar Energy.”

Based on the results from the government-funded seismic exploration, Heart’s Content is one of the best offshore prospects. According to Jim Keating, CEO of the Oil and Gas Corporation of Newfoundland and Labrador (OilCo), It could potentially help with the start of natural gas industry in the region.

“In that licence we have a real classic structure, one of the top 10 that we have. It is a multibillion-barrel potential. And also in that area we have the potential for natural gas development as well,” stated Keating.

The Canada-Newfoundland and Labrador Offshore Petroleum Board released the results of the most recent bid round on Wednesday.

Five bids worth $238 million were collected on a record 38 parcels on offer. Three of the bids were submitted by partners Equinor and BP Canada, and they are located in close proximity to the huge Bay du Nord discoveries in the Flemish Pass.

As the main operator for Bay du Nord, Equinor has stated that a final sanction on the project might happen within the next two years and that the first oil could be produced by the end of this decade.

“They reached out and grabbed three licences that surround their production area, which is great strategic thinking,” Keating said. “They’re going to be there for many decades.”

Additionally, BP Canada has obtained full ownership of a single licence located in the Orphan Basin. This licence is next to a parcel on which the company intends to carry out exploration activities in the upcoming year.

“That’s great because that’s going to be a licence area that will figure prominently once they drill an exploration well next summer in their prospect called Ephesus,” added Keating.

Energy Minister Andrews Parsons praised it as a positive sign for an industry that has seen significant volatility in recent years and is under intense pressure as the world moves away from fossil fuels to reduce carbon emissions.

“Seeing players like ExxonMobil, who have been the backbone here, continuing to think there is a future here, I thought overall … I was impressed and I was quite happy,” he added.

Original source material for this article taken from here

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Written by Olivia Woods

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