Equinor postponing Bay du Nord oil project off Newfoundland for up to three years
![Eldar Saetre Eldar Saetre CEO of Equinor speaking as he gives the company quarterly capital market update in London, Thursday, Feb. 6, 2020. (AP Photo/Alastair Grant)](/content/dam/ctvnews/en/images/2023/5/31/eldar-saetre-1-6421170-1685549596700.jpg)
the premier of Newfoundland and Labrador played it cool Wednesday as Norwegian energy giant Equinor announced it was suspending plans to develop a $16-billion oil project in the province's offshore.
Andrew Furey said the news that Equinor would postpone the Bay du Nord project for up to three years came as a surprise. But he said he remains confident the oilfield would still be developed.
"Of course we're disappointed in the delay, but I would caution everybody that it's just that: it's a delay," he told reporters, adding that Equinor has not given any indication it was interested in walking away from the development.
"The resource is still there. It's not going anywhere," Furey said.
Bay du Nord comprises five different discovery areas off the province's east coast that are said to hold a total of 979 million barrels of recoverable oil, according to recent estimates from Newfoundland and Labrador's offshore oil regulator. The development would open the province's fifth offshore oilfield and be its first deepwater oil project.
Newfoundland and Labrador's latest budget factored in economic gains from the Bay du Nord project beginning in 2025.
Equinor announced its "strategic postponement" of the project in a news release Wednesday as the province's annual energy industry conference was taking place in downtown St. John's, N.L. It said Bay du Nord had seen significant cost increases in recent months, mostly due to volatile market conditions.
Though the company had not yet confirmed it would make the full investment necessary to carry the project through to completion, there was early-phase work underway, including concept studies and assessments, spokesperson Alex Collins said in an email. She said the company will use the delay to "optimize" the project and work toward a "successful development."
Equinor reported a net profit of $28.7 billion in 2022, up from $8.6 billion a year earlier.
The postponement is the second bout of bad news for Newfoundland and Labrador's offshore industry this year. The Terra Nova oilfield, which is majority owned by Suncor Energy, is also delayed. The field hasn't produced oil since 2019, and during the height of the COVID-19 pandemic it seemed Suncor and its partners would abandon it entirely.
The provincial government ultimately gave Suncor $205 million to guarantee the company would carry on with work to extend the life of the field by about 10 years. The province also made adjustments to its royalty scheme to give Terra Nova owners another $300 million over that decade.
Suncor had hoped the field would be back in operation at some point this summer, but it has since removed any production or income forecasts from the project from its financial outlooks for the year.
Furey said any worry now about the two oil projects is "nowhere near" the anxiety that gripped his government during the pandemic when it seemed that Suncor would walk away from Terra Nova. "That is not the environment we're in right now," he said.
The federal government gave Bay du Nord environmental approval last April, drawing sharp criticism from environmentalists. Equinor and the Newfoundland and Labrador government have said the project will produce far fewer greenhouse gas emissions during extraction than any other project in Canada. But environmentalists and climate scientists counter that the bulk of the greenhouse gas emissions from fossil fuels are produced when they are burned.
On Wednesday, Sierra Club Canada said the latest news shows Newfoundland and Labrador must wean itself off revenues from offshore oil. "We know that expanding oil and gas extraction ... is unacceptable and that climate change will only be worse in three years time," spokesperson Connor Curtis said in a news release.
This report from The Canadian Press was first published on May 31, 2023
CTVNews.ca Top Stories
![](https://www.ctvnews.ca/polopoly_fs/1.6974402.1721752977!/httpImage/image.jpg_gen/derivatives/landscape_800/image.jpg)
Laws that could get Canadians in trouble in Spain and other tourism hotspots
There are some laws in popular tourist destinations around the world that could land Canadian travellers in mild-to-serious trouble if they're not careful. Don't let these local laws land you in hot water during your next vacation abroad.
Edmonton gas station employee found guilty of terrorism charges in the U.K.
An Edmonton man has been convicted of multiple charges under the Terrorism Act in the United Kingdom.
BREAKING Polar bear at Calgary Zoo died by drowning following 'crushing' injury
The Wilder Institute/Calgary Zoo has revealed the cause of death for polar bear Baffin last week.
U.S. Secret Service director resigns after Trump assassination attempt
The director of the Secret Service resigned Tuesday in the aftermath of the assassination attempt against former U.S. President Donald Trump that unleashed an outcry about how the agency failed in its core mission to protect current and former presidents.
Quebec mom devastated after man who killed her daughter in hit-and-run gets out after 5 months
A Montreal-area mother is furious with Quebec's justice system because the man who killed her 25-year-old daughter in a 2022 hit-and-run was released from jail after only serving one-sixth of his sentence behind bars.
Waterloo, Ont. woman out thousands for car totalled by stolen hit-and-run driver
A woman in Waterloo, Ont. is out thousands of dollars for a car crash she wasn’t involved in.
DEVELOPING Jasper evacuees forced into B.C. to flee fires told to make U-turn to Alberta for aid
Thousands of wildfire evacuees forced from Jasper National Park into British Columbia along smoke-choked mountain roads Monday night were directed Tuesday to make a wide U-turn and head home if they needed a place to stay.
Keanu Reeves explains why he's always thinking about death
Keanu Reeves is aging like the rest of us. And for that reason, 'The Matrix' has shared, mortality has been on his mind.
Do you need a lawyer when making a will in Canada?
Many people believe that creating a will requires the services of a lawyer, but this isn't always the case. In his personal finance column for CTVNews.ca, Christopher Liew explains a lawyer's role when crafting your last will and testament.