The Canadian Association of Petroleum Producers (CAPP) has released its Newfoundland and Labrador Energy Platform, highlighting the critical role of the offshore oil and natural gas industry in the province’s economic recovery.
The document summarizes key regulatory and policy issues needed to enable offshore industry sustainability and growth, and is presented for the consideration of all registered parties and candidates in the provincial election on February 13, 2021.
Capitalizing on the opportunity to support economic recovery through industry growth requires competitive policies and regulations to ensure Newfoundland and Labrador can compete with other offshore investment opportunities. It will also require any future provincial government to advocate for and demonstrate their support of safe, environmentally responsible offshore oil and natural gas development in Newfoundland and Labrador.
“Addressing the challenges outlined in CAPP’s Energy Platform will help to encourage exploration activity and improve the province’s ability to compete for international investment dollars,” says Paul Barnes, director, Atlantic Canada and Arctic, CAPP. “A collaborative approach is so necessary at this time to show full industry and government support for responsible offshore development.”
Canada’s offshore industry has faced significant headwinds since the oil price crash and COVID downturn of 2020. A number of projects have been deferred and delayed, resulting in lost jobs and opportunities. Even before the recent downturn, the industry faced challenges arising from inefficiencies in the regulatory framework, resulting in especially long timelines for project approvals.
However, the relatively underexplored region has great resource potential with significant resources waiting to be unlocked.
The offshore provides the province an opportunity to supply responsibly produced oil and natural gas resources to world markets, while advancing lower-carbon energy production and clean technology. Realizing this opportunity requires multi-stakeholder collaboration to overcome current challenges and regain industry momentum.
Several offshore producing jurisdictions throughout the world have revised their fiscal and regulatory regimes to increase their competitiveness. Addressing key challenges, such as lengthy timelines from exploration to production and high costs, while continuing to prioritize environmental protection and health and safety, will help improve the province’s ability to compete for investment without compromising performance.
Specifically, action must be taken by the future provincial government in three key areas:
- Addressing short-term challenges to support industry sustainability.
- Implementing competitive fiscal and economic policies to encourage development and attract additional investment.
- Improving timelines and achieving efficiency and consistency in regulatory processes.
Barnes adds, “Regaining momentum in the offshore industry is critical to the economic well-being of Newfoundland and Labrador. Attracting investment will create employment, along with opportunity for local businesses and continued revenues for the provincial government – all of which support a strong economic recovery.”
The platform document is meant to inform all Newfoundlanders and Labradorians of the concerns and vision of the oil and natural gas business in a manner that is non-partisan and is not advertising. The business of energy is the business of every government of Newfoundland and Labrador regardless of its political persuasion. CAPP does not support or oppose any particular registered party or candidate.