Multinational ExxonMobil is currently drilling in very deep waters off the coast of Newfoundland and Labrador and hopes to conduct others in the coming years in an effort to exploit an oil deposit that could contain more than 3 billion barrels.
The imposing ship Stena DrillMax has been drilling a first well for several weeks at a depth of nearly 3,000 m and more than 500 km east of the island of Newfoundland. This area, called the “Orphan Basin”, is located north of the maritime region where Equinor wants to develop its Bay du Nord project, Canada’s first deepwater oil development project.
The “Persephone” well, which is part of a project developed on an exploration permit held by ExxonMobil and Qatar Energy, could also be more promising than the 1 billion barrel deposit discovered by Equinor and whose exploitation has already been approved by the Trudeau government.
According to information released by the specialist publication Upstreamthe potential of the new deepwater exploration area would be around 3 billion barrels. If this oil were eventually burned during its use, it could generate greenhouse gas emissions exceeding 1 billion tons, based on the calculation methods of the United States Environmental Protection Agency.
Drilling and seismic surveys
In a short written response to questions from the DutyExxonMobil did not want to comment on the figures on the oil potential of the seabed of the area, delimited by a permit granted in January 2023. “We are currently progressing in our project [de forage]”Once it is completed, we will have more information to share about the Persephone project,” it was simply stated.
According to ExxonMobil’s project description filed with the Impact Assessment Agency of Canada (IAAC), the fossil fuel multinational is planning a drilling program that is to continue until 2034. It mentions five exploratory drillings, as well as seismic surveys and “production tests.” Planned investments, under the terms of the call for tenders for the exploratory permit, reach $180 million.
Biologist Sylvain Archambault, of the Société pour la nature et les parcs SNAP Québec, emphasizes that the potential remains hypothetical as long as the companies involved have not delineated a possible deposit. He also emphasizes that the project is out of the ordinary in the case of marine environments in eastern Canada, since the oil exploitation platforms are located in areas where the depth reaches an average of 90 to 120 meters.
More oil
The drilling of the Persephone well “is not subject to the Impact Assessment Act,” specifies the AEIC. It therefore did not have to pass the test of an environmental review including an impact study, since it is located in an area of 735,000 km2 where this procedure was abolished in 2020, to be replaced by a regulatory process. The Trudeau government had then argued that the fossil fuel industry is “an important part of our future based on clean growth” and that Ottawa must ensure its “competitiveness” on a global scale.
This vast area, which overlaps the very important commercial fishing sector of the Grand Banks of Newfoundland, has many major ecological zones and is home to several threatened species, including endangered marine mammals.
Newfoundland and Labrador is banking heavily on the development of new offshore oil projects in the coming years. Premier Andrew Fury said last June that fossil fuel production would continue “for decades” in the province, due to global demand. Today, demand exceeds 100 million barrels per day and is expected to continue in the coming years, according to the International Energy Agency.
However, several scientists, as well as the Secretary-General of the United Nations, António Guterres, are calling for an exit from fossil fuels in order to limit global warming to a sustainable threshold. The International Energy Agency, for its part, believes that the approval of new oil and natural gas production projects no longer has a place in the context of the energy transition.
Newfoundland and Labrador and the federal government, however, are looking to develop new projects off Canada’s coast. Last spring, the Canada-Newfoundland and Labrador Offshore Petroleum Board auctioned more than 100,000 km2 oil exploration permits. Many of these encroach on eastern Canada’s largest “marine refuge,” established to protect marine biodiversity.