Although much smaller in scope than the giant oil and gas producer in Western Canada, oil production off the coast of Canada’s easternmost province of Newfoundland and Labrador already has decades of experience behind. With five offshore fields producing just under 230 Mb/d as of early 2023, the region’s slow decline is likely to continue unless additional development work is done on existing fields or new fields are discovered. Building on the province’s commitment to double production by the end of this decade, it has worked with several offshore operators to improve its royalty regime for two existing sites that will generate higher production in the coming years. Also, a major discovery has real potential to deliver on the promise of doubling production by the early 2030s. In today’s RBN blog we consider the history of the region’s offshore oil production and plans futures to increase production.
When we think of Canada’s oil and gas industry, what may usually come to mind are the vast reserves and production of the oil sands, the immense productivity of natural gas wells in the unconventional Montney formation, or perhaps, unfortunately, too many cases of congested crude. pipelines that result in deep discounts on the prices of its flagship heavy crude oil. While the first two are still true, the third example has become much less of a problem recent pipeline expansions from Alberta in the US Midwest. However, they are all related to oil and gas activity in the country’s western provinces of Alberta, British Columbia and Saskatchewan.
What might not immediately come to mind is that on the other side of Canada, off the coast of its easternmost province of Newfoundland and Labrador — also known as The Rock, hence the title of the blog’s song of today— there is another oil-producing region that has played an important role in the industry and energy economy of this province and the nation. Although oil was thought for most of the 20th century to be present in the oceanic depths of Newfoundland, it was only after many years of work and test drilling that Chevron Canada discovered commercial quantities of crude oil in 1979 in the Hibernia field (red diamond in Figure 1), 180 miles (180 miles). ~300 km) east of the provincial capital of St. John’s in the North Atlantic. First production from this field and the region began in November 1997.
