Nfld. & Labrador

Oil play in the making? Sale of survey data another indication of Flemish Pass potential

In another sign of the growing interest in deepwater exploration in offshore Newfoundland, a Norwegian company reported this week that a "major oil player" is spending millions to acquire important 3D electromagnetic data for the Flemish Pass Basin.

EMGS says 'major international oil player' has purchased data from its offshore Newfoundland library

This map details the ongoing 3D electromagnetic data collection program being carried out by a company called EMGS in the Flemish Pass Basin. (EMGS website)

In another sign of the growing interest in deepwater exploration in offshore Newfoundland, a Norwegian survey company reported this week that a "major oil player" is spending millions to acquire some of its 3D electromagnetic data for the Flemish Pass Basin.

Electromagnetic Geoservices ASA, also known as EMGS, carried out what's known as a controlled source electromagnetic program in the Flemish Pass in 2014, in the now familiar areas known as Bay du Nord, Harpoon and Mizzen.

In simple terms, this data, in conjunction with seismic data, is used to indicate the presence and quantity of hydrocarbons such as oil, and the data is often used by companies to explore leads, rank prospects and drill better wells.

Earlier this week, EMGS announced it had entered into a US $3.9-million data licensing agreement for its Flemish Pass Basin library with an undisclosed oil company.

But CBC News has confirmed that Statoil is the company that acquired the data.

"Licencing existing data from multi-client providers is part of our ongoing evaluation of offshore Newfoundland and is standard business practice for exploration," a Statoil spokesperson wrote in a statement.

Statoil is leading the charge of a handful of well-known oil players to develop a producing field in the Flemish Pass, and just wrapped up one of the most comprehensive drilling and appraisal programs in Newfoundland's offshore since the 1970s, using the semi-submersible West Hercules.

Statoil is expected to release more information on its drilling program early this summer, but sources are already saying the company will be back "within one to two years for further drilling with a much larger scope of work."

Officials with Statoil have not confirmed this.

A breakthrough for EMGS

The survey data is being made available to Statoil this month, and "represents a breakthrough for the application of our technology in this region," EMGS CEO Christiaan Vermeijden said in a May 24 news release.

Vermeijden said the offshore basins of Newfoundland are largely under-explored and the use of 3D electromagnetic data will "aid companies in developing a better understanding of the basin's complex geological structures and its hydrocarbon potential."

Frontier basins such as the Flemish Pass and Orphan are being touted as the next major play for Newfoundland's offshore sector, but observers acknowledge it won't happen anytime soon.

"I believe there will be in 10 to 15 years' time," one industry insider stated when asked when a producing oil field might be operational in the Flemish Pass, located some 500 kilometres northeast of St. John's.

The West Hercules semi-submersible drill rig is shown here partially obscured in fog and rain just off Bay Bulls on Thursday afternoon. (Eddy Kennedy/CBC)

Late last year, the provincial government raved about a seismic study of 11 parcels of land up for bids in the Flemish Pass that show the potential for up to 12 billions barrels of oil.

Then premier Paul Davis described the potential as "enormous" and said the results show that Newfoundland and Labrador is on its way to becoming a global energy giant.

About the Author

Terry Roberts is a journalist with CBC's bureau in St. John's.