Rezori: Why is Nalcor not on speaking terms with this company?

While Nalcor Energy is pushing full steam ahead with seismic work off Labrador, a dispute with an Alberta company is lurking in the background, writes Azzo Rezori.
Paul Einarsson, seen in a frame from a video posted to YouTube, is critical of what he calls 'seismic pirates.' (CBC)

Just over a week ago, Nalcor, the provincial government's energy corporation, announced it has signed a deal with Electromagnetic Services ASA of Norway to carry out more seismic exploration offshore.

It's part of the government's strategy to make as much information public as possible on the geology of the ocean floor — the theory being that if the results look promising, more oil exploration companies will come here, try their luck and spend their money, and in doing so keep the offshore boom going.

There was a time when Nalcor might have considered doing business with Geophysical Service Incorporated (GSI), a company from Alberta which conducted the original seismic surveys that led to such offshore gas and oil discoveries as Sable Island and Hibernia on the East Coast and Amauligak in the Beaufort Sea.

But regular business between the provincial government and GSI is no longer possible. They're not even on speaking terms except through lawyers.

The government isn't going out of its way to talk about it; GSI, on the other hand, is.

'Fight for survival'

It's all over the company's official website with headlines such as "the GSI fight" and "GSI faced to fight for its survival." There are several videos explaining the situation, with company chair Paul Einarsson saying at the end of one of them, "I want to teach those guys a lesson that they can't do this in Canada."

With "these guys" he means, among others, the Government of Newfoundland and Labrador and the Canada-Newfoundland and Labrador Offshore Petroleum Board. With "this" he means theft and piracy of intellectual property.

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As Einarsson  explains, in places like Alberta and Saskatchewan you can get a permit to do seismic exploration without having to reveal any of the results to the licencing agencies.

People who want to get their hands on the results go to you and pay for them, which is how you recover your costs (seismic exploration isn't cheap) and make money.

The rule is different in Atlantic Canada. Here, you have to agree to share your results as a condition of getting the exploration permit in the first place. For 10 years you, the owner, keep the exclusive right to licence the results to others; after that, they become public information, like books in a library.

All three governments involved — Canada, Nova Scotia, and Newfoundland and Labrador — maintain that requesting the data, holding them for 10 years, and then making them public is for the greater good.

Einarsson asks, what about GSI's good? 

'Seismic pirates'

He's launched about three dozen lawsuits against the governments and a number of companies alleging that some of his company's seismic data have been released improperly, and that some of those have been pirated by third parties. In a video, he takes aim at what he calls "seismic pirates."

He's also challenged the right of the governments to release the data in the first place. "Is it really for the greater good to take from small Canadian data owners and give millions of dollars of data to very wealthy, mostly foreign oil companies for free?" he asks.

So far the legal battle has not been going GSI's way. A justice of the Supreme Court of Nova Scotia recently ruled that according to the mandate they have set for their offshore policies, the governments do have the authority to demand, store, and release privately collected seismic data.

Einarsson argues it all amounts to expropriation of intellectual property, and he vows to continue the fight. He says he hates what he got himself into, but there's no turning back.

It's already too late to save the company. GSI used to operate two seismic ships and had around 250 employees spread over offices worldwide. Only the head office in Calgary remains, with a staff small enough to count on two hands. 

No more collection of new data

With the company's data gone public, there's no more revenue. Without revenue. there's no money to collect new data. All Einarsson has left to fight for is the principle of ownership of intellectual property he says has been trampled in the rush for offshore fortunes.

In the meantime the bus rolls on.

Nalcor continues to pour millions into the collection of new and more up-to-date seismic data with other partners. Recent results hold out prospects of huge oil and gas reserves all along the Labrador Shelf and into the deeper waters of the Flemish Pass. The money that interested companies have to fork out to get their hands on this information now goes to Nalcor and its partners. If the companies want to have a look at the older information technically still owned by GSI, they can have it for nothing with a simple few clicks of a mouse.

That leaves GSI in the dust as just another casualty of the oil boom, at least in the eyes of those who are still on the bus. Einarsson, for his part, sees his company as a victim of government policy subverted by greed.

The tone of his video rants runs the gamut from reason, to outrage, to missionary zeal that borders on melodrama.

"I am from Alberta and proud of it," he states. "I will seek justice from those who have lost their way and seek to take Canada in the wrong direction."

About the Author

Azzo Rezori


Azzo Rezori has been working with CBC News in Newfoundland and Labrador since 1987, and reports regularly for Here & Now and other broadcasts.