“Our focus with offshore will definitely be on the workers,” O’Regan said.
“We want to make sure that, as best we can, we can make sure that workers are taken care of, and we make sure that the industry remains competitive in a world that changes very quickly. ”
At a rally last week hosted by Unifor and attended by hundreds of offshore workers, industry representatives and supporters, some workers spoke of the anxiety that pervades their lives amid the current layoffs and uncertainty about the future.
“We will be working with the province, industry and unions on this, but we will have more details on this to come,” said O’Regan.
O’Regan did not say whether any help would be offered to offshore oil companies or the industry in general, where several projects have been halted or delayed, including Husky Energy announcing on September 9 that it could not go from the front with its 2.1 billion dollars. Extension of West White Rose without government assistance.
Husky wanted a government investment in the project, such as when the federal government spent $ 431 million in the 1990s on a stake in the Hibernia project in exchange for future royalties.
Asked about helping the industry, in the same way now, O’Regan said, “In some ways the industry is still pretty strong. You know, Hibernia and Hebron are still going strong, but there’s no doubt a lot.
“It’s a mature industry. We are not where we were in 1993. ”
The contractor who runs the drilling operations on the Hibernia oil rig, Parker Drilling, said he began laying off workers in June, after the rig operator said he would suspend drilling for 18 months to save money.
Province to provide incentives
On Thursday morning, the provincial government announced some details of a new incentive program that it hopes will further encourage offshore exploration, which Premier Andrew Furey has called “creative thinking.”
As it stands, when companies apply to explore the province’s offshore areas, they are required to deposit a deposit of 25% of their total expected supply. If a company does not complete its drilling work within a specified period of time, it loses this deposit, which is then added to the general treasury of the province.
Instead of this money going into the provincial bank account, this incentive will keep it aside and return it to exploration companies through a rebate or some other mechanism to be determined.
The default rate on these deposits has historically been 37%, said Andrew Parsons, Minister of Industry, Energy and Technology.
But in the past, this extra money from year to year has caused budgetary headaches, as it depends entirely on the completion of the works of the companies, or not, he said, so it makes sense for everything. send to the same place to be reinvested in the sector.
“It’s not taxpayer funded. This is money that is actually invested by the industry, and it is absolutely impossible to budget for it, because it is difficult to know what that amount would be for a given year, ”he said.
The goal, according to the province, is to encourage more exploration, which creates jobs and investment and could lead to concrete projects.
Parsons said many details of the program have yet to be worked out, but with exploration bid filings due in November, the province wants to let companies know that there could be cash benefits for choosing Earth- Newfoundland and Labrador.
“Right now, exploration budgets around the world are very dramatically reduced, so we want to put that incentive in now as they enter the final stages of their planning,” he said.
The “Atlantic loop”
O’Regan’s comments come the day after the Speech from the Throne, which notably did not mention the oil sector but focused on green energy and launched the idea of the ‘Atlantic Loop’ – a new phrase described in one line as a project to use clean energy to wean the Maritimes off coal.
O’Regan said hydroelectric power will be linked to the Maritimes power grid, with transmission lines built from Quebec to head to New Brunswick and Nova Scotia.
O’Regan called it “a tremendous and huge opportunity for Newfoundland and Labrador”, especially for the electricity in Muskrat Falls, and said that overall it is helping to reduce greenhouse gas emissions. Greenhouse.
Amid clean energy projects and the need to meet Canada’s emissions targets set out in the Paris Agreement, O’Regan said there was still room for offshore oil.
“The point is, oil will be with us for a while,” O’Regan said.
“We want to make sure Newfoundland is well stocked and that we are able to sell the world a great product as we move to a low emissions economy. ”
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