Archive for the ‘Canada’ Category

An international regulatory colleague brought this puzzling RigZone article to my attention. Quotes:

“From one perspective, one can look at the overall absence of risk – from this perspective, we can easily say that either the United Kingdom’s North Sea or Canada’s Nova Scotian continental shelf is the safest region for offshore oil and gas operations right now,” Robak told Rigzone.

“Canada’s offshore industry accounts for approximately one million barrels per day, and its geographic location along the Nova Scotian continental shelf has been a benefit in that there is little to no risk to its continued operation on a day-to-day basis,” Robak said.


Scotian shelf

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41 years ago today, 84 men lost their lives on the Ocean Ranger. BOE’s 40th anniversary posts can be viewed here and here. The excellent 40th anniversary tribute video is embedded below. Remember these heroes.

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Newfoundlander Howard Pike’s excellent tribute to my former colleague Charles Smith can be viewed from minutes 26 to 36 of this video.

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The offshore world lost an important figure over the weekend with the passing of John Gregory Fitzgerald. As Chairman and CEO of the Canada Newfoundland Offshore Petroleum Board in the late 1990’s, John presided over the first production from the massive Hibernia field. He also approved the pioneering Terra Nova project, the first FPSO development in a harsh, iceberg laden environment.

John worked closely with his international counterparts and hosted an important offshore safety meeting in St. John’s in 1996. It was an honor to be associated with such an outstanding individual and dedicated safety leader.

RIP John, your contributions will not be forgotten.

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… especially those in Newfoundland where the only offshore oil and gas operations in the N. American Atlantic are being conducted.

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Home overlooking Iceberg Alley near Ferryland, Newfoundland (from Earthly Mission)

Far offshore from Ferryland (see map below), oil and gas operations are conducted in what are arguably the world’s most challenging conditions. The Grand Banks has been called the “North Sea plus icebergs,” and that may be an understatement.

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Newfoundland is only 30 to 90 minutes ahead of the other Atlantic provinces and states, but the offshore energy gap is much greater. Newfoundland continues to be the only Atlantic producer, and the future is looking brighter with another positive step by industry and the provincial government.

Calgary, Alberta (May 31, 2022) – Cenovus Energy Inc. and its partners have agreed to restart the West White Rose Project offshore Newfoundland and Labrador. First oil from the platform is anticipated in the first half of 2026, with peak production anticipated to reach approximately 80,000 barrels per day (bbls/d), 45,000 bbls/d net to Cenovus, by year-end 2029.

Construction includes the completion of the concrete gravity structure and topsides, which will serve as the drilling platform for the project. Once installed, the platform will be tied into existing infrastructure.

West White Rose Extension Project

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This graphic uses 2021 EIA data to compare the volumes of crude oil and petroleum products imported by the US from other countries.

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Wall Street Journal: U.S. Wants More Oil From Canada but Not a New Pipeline to Bring It


This WSJ report, if accurate, reflects the mindset that you can increase oil production on demand when absolutely necessary, and avoid committing to longer term oil and gas supplies. The goal of such thinking is to address supply crises without alienating the uncompromising climate ultras. You suspend lease sales, deny new pipelines, and demonize oil and gas and the people who produce it. When supplies tighten and prices spike, you tap the strategic reserve, appeal to OPEC, talk to Venezuela and Iran, and ask Canada to ship more oil in rail cars or trucks (but no new pipelines please!). .

Below is a pie chart constructed using data from a 2018 DOT report to Congress. For logistical and economic reasons, pipelines are overwhelmingly the crude oil transport method of choice. Rail cars and trucks are called on where there are no pipeline options.

data from 2018 DOT report

Looking at the systems, one would assume that pipelines have safety and environmental advantages. Loading and unloading hundreds of tanks would seem to be inviting spills, although most would presumably be small. The DOT data bear this out. On a volume transported basis, spill incidents occurred nearly 15 times more frequently for rail cars and trucks than they did for pipelines.

For pipeline(s), an incident occurred approximately once every 720 million gallons of crude oil shipped. For rail, an incident occurred approximately once every 50 million gallons of crude oil shipped. For truck(s), an incident occurred approximately once every 55 million gallons of crude oil shipped.

Looking at the percentage spilled, pipelines also had a significant (7.6 times) advantage over rail, but only a slight advantage over trucks.

Volume of Crude Oil Shipped and Spilled by Pipeline, Rail, and Truck, 2007-2016

volume shipped (k gal)1,298,630,088
volume spilled (k gal)13,161
% spilled0.0010%
volume shipped (k gal)23,052,960
volume spilled (k gal)1,751
% spilled0.0076%
volume shipped (k gal)47,894,868
volume spilled (k gal)521
% spilled0.0011%

Because fatalities or hospitalizations were extremely rare, DOT chose not to normalize those data. There were a total of 3 fatalities associated with both pipeline and truck shipments. While no fatalities were associated with rail shipments, DOT noted that 47 deaths resulted from a crude oil derailment in Lac Megantic, Quebec in 2013. BOE further reminds readers that this train was transporting Bakken crude from North Dakota to a refinery in St. John, New Brunswick.

The bottom line is that you have to plan ahead to satisfy future supply needs. This is particularly true for the offshore sector where the lead times are longer, but the production volumes relative to the number of wells and facilities are higher (a good thing). The need for oil and gas is not going away, nor are threats to energy security. There are plenty of people in the U.S. Department of the Interior who understand this. Empower them to safely expedite leasing, exploration, and development!

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Bay du Nord FPSO planned for 500 km offshore St. John’s in 1200 m water depth

Federal Environment Minister Steven Guilbeault formally approved the Bay du Nord offshore oil megaproject Wednesday, making a decision that will infuriate environmentalists but boost the Newfoundland and Labrador economy.

CBC News

Previous post on this project.

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