Nfld. & Labrador

Oil company getting out of fracking ... for now

Black Spruce Exploration, an oil and gas company with a presence on the west coast of Newfoundland, says it will finalize its exploration plans this fall.
Proposals to use hydraulic fracturing near Gros Morne National Park drew international concern from environmentalists and conservationists. (CBC)

An oil and gas company with a presence on the west coast of Newfoundland says it will finalize its exploration plans this fall.

But David Murray, president and CEO of Black Spruce Exploration, said those plans will not include hydraulic fracturing, which is the controversial process of pumping fluid into a well to create enough pressure to crack, or fracture, the rock layer.

He said the company hopes fracking will one day be an option, but for now, it will focus on more traditional — and approved — methods of extracting hydrocarbons from the earth.

He hopes the company can begin executing its plans in onshore and offshore areas of the west coast next spring.

“Hopefully, hydraulic fracturing legislation will eventually become part of the opportunity,” he told CBC News.

“But for the foreseeable future, we want to get on with opportunities in a number of other areas."

Going separate ways

The provincial government instituted a moratorium on the use of fracking in onshore operations in November 2013.

The decision was celebrated by those opposed to the practice, who say it is a threat to the environment.

Black Spruce, in partnership with Shoal Point Energy, had been interested in using fracking.

But earlier this week, it was announced the companies were going their separate ways, and a so-called “farm-out” agreement had been terminated.

Murray said officials at Shoal Point Energy intend to become more engaged in the “public discourse” relating to the use of fracking, while Black Spruce will take a different approach.

“We thought this will allow them to pursue a course they wanted to pursue and allow us to focus on conventional reserves in the way we wanted to as well,” he explained.

Black Spruce has exploration licences in three onshore and offshore areas on the west coast, covering an area of some two millions acres, and plans to “pursue all three of those at the same time,” said Murray.

Eventually I hope that … people will have a chance to examine it and be more comfortable with it, but for the near-term it’s not a part of our strategy.- David Murray

He said the company immediately switched its focus to more traditional exploration methods after the fracking moratorium was announced.

When asked if the company can achieve success without fracking, he said “absolutely” and “there’s no need to use fracturing.”

But he reasserted his long-held position that fracking is safe.

He once said a tanker truck full of gasoline hurtling down the highway is a bigger environmental threat than hydraulic fracturing done correctly.

“People who work in the industry know it’s a commonly used pursuit to recover hydrocarbons,” he said.

Murray said 85 per cent of wells drilled each year - roughly 50,000 - in North America, including locations such as Alberta and Saskatchewan, use hydraulic fracking.

“Eventually I hope that … people will have a chance to examine it and be more comfortable with it, but for the near-term it’s not a part of our strategy.”

In early August, facing public and political pressure, the provincial government announced it would commission an independent external review of fracking.

The Department of Natural Resources previously completed an internal review, which has not yet been made available to the public.


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