Nova Scotia delays call for offshore oil and gas exploration bids

Business Minister Geoff MacLellan emphasized that the decision was only made in order to issue the call for bids at a more opportune time of year.

'The timing isn't necessarily great for industry,' says Business Minister Geoff MacLellan

An oil platform is shown in the North Sea off the Norwegian coast. Nova Scotia's business minister says the province is delaying this year's call for exploration bids because 'the timing isn't necessarily great for industry.' (European Pressphoto Agency)

The Nova Scotia government is delaying its call for offshore oil and gas exploration bids until later in 2018, Business Minister Geoff MacLellan said Wednesday.

"The timing isn't necessarily great for industry. To come out with this in the summer and conclude in early fall probably wouldn't be the most beneficial for the process of that call being answered by the private sector in oil and gas."

MacLellan emphasized that the decision was only made in order to issue the call for bids at a more opportune time of year.

"It is not going to be a long-term delay. It will take place, we are confident in that." 

Need to refine specifics of reserves

At the same time, he said, the province is adding $11.8 million to its Play Fairway Analysis program, which helps the private oil and gas sector define areas where reserves exist as well as the risk and ranking of exploration possibilities.

The funds go to "geoscience, using tools, using information, using technology to refine the specifics of some potential areas, so that the calls could ultimately be more successful," MacLellan said.

The Nova Scotia government is also in discussions with the Department of Fisheries and Oceans and Natural Resources Canada to analyze how the $1.5-billion national Oceans Protection Plan will affect the offshore energy sector.

"[There's] an ongoing discussion with the federal government around their oceans protections strategy, 10 per cent by 2020," the minister said.

He said concerns of the fishery have to be balanced with the oil and gas sector. "That's critical as well."

Getting it right

MacLellan downplayed the impact of the bid delay.

"Given the timelines and nature of these exploration processes with the development of any particular well, these things take a number of years," he said.

"They are a long-term gain and certainly a large investment. So we are certainly comfortable in our position."

With natural gas production in the Sable Offshore Energy Project winding down, there's not much activity in Nova Scotia's offshore oil and gas fields.

Currently, BP Canada is proposing a one-well exploration program. The well will be drilled approximately 330 kilometres off Halifax.

Statoil has acquired two licences, but hasn't made any applications yet for any geoscience programs or exploration. The first licence expires Jan. 14, 2022.

And Shell Canada capped its two exploratory wells in its Shelburne Basin Deepwater Exploration Project more than a year ago.