Thursday, September 16, 2021
Published: Feb 2015
  • Newfoundland & Labrador

Exploring Vast Opportunities

With the Newfoundland and Labrador Oil and Gas Industries Association (Noia)

Newfoundland and Labrador’s first oil and gas  well was drilled in 1966 and within a decade  came a flurry of oil and gas exploration that  lasted into the mid-1980s. It was during this  period of high activity, in 1977, that the Newfoundland and Labrador Oil and Gas Industries Association  (Noia) was founded to connect local businesses with emerging opportunities in the industry. Today, Noia is the largest  offshore petroleum association in Canada – over 620 members  strong – with a mission to promote development of East Coast  Canada’s hydrocarbon resources and to facilitate its membership’s participation in global oil and gas industries. Members  include local companies, many companies from other parts of  Canada, and a signifi cant international membership, signifying the global scope of the province’s oil and gas industry.

Noia provides a range of invaluable services to its members,  from advocacy and industry promotion to business information and networking opportunities and events, such as its  widely-attended annual conference. Included in its valuable  services is the distribution of timely industry updates through  The Daily Barrel, an email bulletin issued directly to members  each day, detailing local, national and international industry  news, expressions of interest, and a host of other relevant information.

Noia also facilitates information sessions between oil and  gas operators and local suppliers and service providers, as  well as hosts its Play on the Edge conference every June in St.  John’s, Newfoundland and Labrador’s capital city. The event,  which has been running for over thirty years, is the premium  oil and gas conference in Canada and regularly attracts around  1,200 participants, including delegates from oil and gas jurisdictions all over the world.

“We look at topics related to harsh environments, we look at  broader social issues like social license, and we take a broad look at the industry from a geopolitical perspective,” says Bob  Cadigan, Noia’s President & CEO. “All the things you need to  know as a business leader in order to operate in what truly is  an international business.” Legislative issues have never been far from the conversation  and Noia has played a key role in lobbying Government for  change where it is deemed necessary. One such matter was  that of legislative impediments to oil and gas exploration in  Canadian waters. Due to legislation limiting access for seismic vessels, these waters were vastly underexplored, particularly off the shores of Newfoundland and Labrador.

Seismic data is critical for oil and gas companies interested in  looking at the potential of an area for development; however,  legislation meant that operators of these vessels were unable  to collect the data, which is captured and then made available  for sale to interested parties. This meant that in the critical period of the mid-1980s up until recent years, no multi-company  seismic data was collected in Canadian, and Newfoundland  and Labrador waters.

“This has really held back the Newfoundland and Labrador  offshore and the Canadian offshore industry in general for the  last fifteen to twenty years,” says Cadigan. “Noia, the Province and others have lobbied hard.” The hard work paid off as, in 2010, the Government of Canada made a change to allow seismic vessels practically unfettered access to Canadian waters, ushering in a period that is  seeing some very large seismic programs getting underway to  fi nally collect this much needed data.

One such initiative, started three years ago, is a joint venture  between Newfoundland and Labrador’s power company, Nalcor Energy; Petroleum Geo-Services (PGS), an operator of  seismic vessels; and TGS, a company that deals with the sale  of the data to interested oil and gas operators. This initiative  garnered international attention as the largest discovery of its kind in 2013 and has opened up a whole new area for further  exploration and development.

“We will have a library of data available that will run from  the northern tip of Labrador, right down to the Grand Banks  and across the boundary with Nova Scotia, the boundary with  Quebec and the Gulf of St. Lawrence,” says Cadigan. “So  we’ll have one of the largest, most modern pools of seismic  data available and that is a critical ingredient.” “We are now an area that international operators are looking  at investing in. They will invest and we will see a renaissance  of exploration in Newfoundland and Labrador.” In a recent land sale, include price one of the existing operators in the Newfoundland and Labrador offshore, ExxonMobil, bid on a parcel of exploration land in the Carson Basin, one of the previously unexplored areas that this new legislation has opened up. Noia sees this as a leading edge indicator  of the kind of global attention that is beginning to be seen in  the province.

Attention is also being cast even further north, to unexplored  and potentially lucrative regions in the Arctic, and Newfoundland and Labrador’s rich heritage of oil and gas experience in  harsh conditions positions the province as an ideal Path to the  ArcticTM. The province already has three major projects under its belt in the form of Hibernia (fi rst oil 1997), Terra Nova  (first oil 2002), and White Rose (fi rst oil 2005), with Hebron  (first oil planned for 2017) set to soon make it four. These  operations have helped to grow Newfoundland and Labrador’s  capabilities significantly over the past twenty-plus years, particularly as it relates to operating in cold, harsh and ice-prone  environments.

“When Hibernia was built, or when the project was envisaged, there were skeptics as to whether you could produce  oil in an environment that had seasonal sea ice, the fog, the  sea states,” says Cadigan. “We were a frontier, at the absolute  edge of what’s possible in terms of producing oil and gas in a  harsh environment.

“It has led to us being, really, thirty years ahead of the rest of  the world in terms of producing oil in a harsh environment that  has many similar conditions to those that exist in the Arctic.” The 2008 fi ndings of the United States Geological Survey  (USGS) greatly ramped up interest in the Arctic, identifying  1670 trillion cubic feet of natural gas, 44 billion barrels of  natural gas liquids and 90 billion barrels of oil yet to be discovered in Arctic waters.

“This is where about 25 per cent of the world’s remaining oil  and gas resources are located,” explains Cadigan. “So, I think  we were lucky in that with the discovery of Hibernia in 1979,  and fi rst oil in 1997, we were substantially earlier than rest of  world in terms of dealing with Arctic-like conditions. We have  a head start and that’s a positive thing.” The Hibernia platform was the fi rst of its kind, designed to  withstand the impact of a one million tonne iceberg and the  considerable forces of pack ice. Terra Nova brought about innovations such as a disconnectable turret that could be moved  out of the way of incoming sea ice, and subsea excavations  that protect subsea equipment from iceberg scour.  Meanwhile, the soon-to-be operational Hebron platform  will become one of the world’s biggest float-over operations.  These are all examples of innovations made directly because  of the Arctic-like conditions found in Newfoundland and Labrador’s offshore.

“We were the innovators, we have a lead in terms of the  thinking, we’ve done a lot of research, and we have a lot of  companies that have fi gured out how to deal with these issues,” says Cadigan. “They are world leading, world class,  and will be called upon for many of the challenges as oil and  gas companies start to move in.” Newfoundland and Labrador is the World’s Cold Ocean Laboratory TM . During the winter season (December to March),  winds can reach 90 to 100 knots offshore – hurricane force.  Sea ice, up to 100 centimetres thick, may reach the area from  February to April, two to three years out of every ten. Icebergs  pass through the area from March to July. Fog from April to  August can reduce visibility and impact crew changes by helicopter. Air temperatures can dip to minus-18.5°C.

Living and working for generations in these challenging  conditions has given rise to a great amount of expertise and  innovation. Newfoundland and Labrador is known worldwide  for its expertise in ice engineering, surveillance and management. Its capabilities have evolved to include remote logistics;  geotechnical, ocean and environmental engineering; marine  meteorological services; safety and training; and many more.

St. John’s is home to a cluster of private sector ocean technology companies, public institutions, and R&D infrastructure. Applied research and development in ocean mapping,  ocean observation systems, ocean instrumentation, and ocean  intervention is ongoing and the province’s Marine Institute is  home to the most comprehensive suite of marine simulation  capabilities in North America, and possibly the world.

2014 was a typically active year for Newfoundland and Labrador in the oil and gas sector. Nalcor began working with  Airbus Defence and Space to map oil slicks originating from  the seabed on the surface of the ocean using satellite imagery.

Nalcor also partnered with Ikon Science Canada to release a  comprehensive regional pore pressure study for offshore Newfoundland and Labrador to the global oil and gas industry. The  first large-scale study of its kind for offshore Newfoundland  and Labrador, it is a comprehensive evaluation of the subsurface pressure systems in the province’s eastern frontier slope  and deep-water basins.  The study region spans an offshore area from northern Labrador to the Flemish Pass in the south, including the newly  discovered Chidley, Henley and Holten basins in the Labrador  Sea.

Meanwhile, EMGS (Electromagnetic GeoServices) Canada  embarked upon a non-exclusive, four-year electromagnetic  data acquisition campaign covering a 41,000 sq. km area from  northeast Newfoundland to the Southern Grand Banks.

This activity is in addition to the continuous work being carried out on a daily basis in the province, which involves some  truly world-leading companies that are counted among Noia’s  membership.

Provincial Aerospace (PAL) is a world leader in maritime surveillance with over 165,000 hours of airborne operations, working on projects in thirty countries globally, specializing in ice management support, iceberg detection and  reconnaissance, environmental observation and reporting,  oceanographic measurements, and weather forecasting.

Virtual Marine Technologies (VMT) was incorporated  in 2004 and emerged from collaboration between the oil and  gas industry, Memorial University and the National Research  Council, in recognition of the importance of safety and survival training, and emergency preparedness to support the growth  of the oil and gas industry. VMT’s roots remain tied to the  Newfoundland and Labrador offshore, but it has broadened its  focus to apply its maritime simulation expertise to meet the  needs of a growing number of other global industries.

Rutter Inc. has evolved from being the world’s largest  supplier of voyage data recorders to now supplying fully integrated radar-based systems for oil and gas exploration and  production, as well as security and surveillance applications.

GRI Simulations was established in 1986 to provide  support for ROV (Remote Operated Vehicle) system development. Since 1997, the company has focused on supporting  subsea ROV operations by providing simulation technology  to enhance pilot training, mission planning, and rehearsal for  offshore oil construction and production operations.

Northern Radar, much like PAL, focuses on maritime  surveillance, including search and navigation equipment for  tracking ships, icebergs, sea ice and low-flying aircraft.

Oceans Limited was incorporated in 1981 to carry out  applied research in oceanography. The company has conducted a variety of research activities, including search and rescue  field trials, detection of objects at sea, oceanographic data collection, and analysis of waves, currents and ocean circulation.

This is just the tip of the iceberg in terms of the variety of  skills and knowledge that has both paved the way for, and  evolved thanks to, the great success of Newfoundland and  Labrador’s offshore petroleum industry, which is the largest  contributor to the provincial GDP, at around 33 per cent.

With oil production value of over $8 billion, the royalty revenues for 2012 alone amounted to $2 billion, and three new  basins were announced last year, covering an area the size of  the Gulf of Mexico, along with significant finds beyond the  northern tip of Greenland and in Statoil’s Bay du Nord prospect.

Nalcor continues to conduct seismic work in northern waters, with more than 50,000 line km completed since 2011,  and a 2014 extension to acquire an additional 30,000 line km  of data in the Labrador Sea, Northeast Newfoundland Shelf,  Flemish Pass and the southeast Grand Banks. Surveys could  continue until 2018.

Put simply, the province has had great success in operating  offshore in cold, harsh and ice-prone environments and is ideally equipped to assist in a new era of oil and gas exploration  and operations.

“The environment we have here has a lot of the same characteristics as the Arctic, and we’re a perfect incubator and proving ground for the technologies that will be necessary to move  oil and gas exploration and development into the Arctic,” says  Cadigan.

While exploration and development in the Arctic is not  something we are likely to see for some time, the signs are  that it is a case of not ‘if’, but ‘when’.

“I think we’re in a world where there are a number of pieces  that have to be sorted out before exploration and development  begin in the Arctic,” says Cadigan. “Social license, the people  adjacent to the resources, particularly indigenous peoples in  the north, particularly the Inuit, they need to decide when they  are ready to see exploration and activity in the lands they have  used for centuries, so certainly social license in as an issue  that needs to be addressed.

“We believe that, over time, the opportunities for well-paying jobs and opportunities for indigenous businesses will help  and we’ll see the social license evolve in the Arctic.” For all the challenges that come with exploration and development in the Arctic, Newfoundland and Labrador is poised  and ready to provide the solutions.

Its strong ocean technology cluster, composed of public  R&D facilities and private sector companies, is a natural evolution for a people that has traditionally derived its living from  the sea and possesses skill sets that transcend generations and  ocean sectors.  Add to this the province’s deep cultural connections with  Aboriginal peoples, its cold ocean and near-Arctic conditions,  and its strategic location along international shipping lanes  and northern sea routes, and you have the ideal cold ocean  laboratory and Path to the ArcticTM.

“We are uniquely positioned because we’re far enough south  and some of the conditions are sporadic, whereas in the Arctic  they are continuous, so it makes us an absolutely perfect proving ground,” says Cadigan.

“The other thing we see is the investment the oil companies  are making here to take advantage of the bright minds; the  core base of knowledge and the facilities we have.

“We have not only the heritage and a part in developing some  unique technology; we have the core knowledge, we have  continuous research, and we’ve demonstrated that we have  the entrepreneurs that are needed to take an idea that might  help to commercialization. We have enablers like the Atlantic  Canada Opportunities Agency (ACOA) and the Government  of Newfoundland and Labrador…We’ve got a lot of things  going for us.”

Back to Special Reports and Whitepapers Library
Marine Technology ENews subscription Marine Technology ENews is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week
Subscribe for MTR E-news
page 24

Shipboard ADCP Surveys

Mapping Subsurface Ocean Currents

page 30

Networked Systems

Enable Ocean Observation

page 36


Empowering the Seafloor

page 44

SubC Imaging

Vision Underwater

page 48

Provincial Aerospace

Eyes in the skies

page 50


Smart solutions for challenging environments