CNOOC awards contract to Stena for exploration work in Flemish Pass
An oil and gas company is preparing to resume offshore exploration activity in Newfoundland and Labrador next spring.
China National Offshore Oil Corp. (CNOOC) Petroleum North America ULC recently awarded a contract to Stena Drilling to use its mobile offshore drilling unit Stena Forth. According to a post to Stena Drilling's Facebook page earlier this week, the 90-day campaign will start in the Flemish Pass Basin at some point between April and June of 2021.
Located approximately 400 kilometres east of St. John's, the Flemish Pass Basin is an area where CNOOC had planned to start exploration drilling earlier this year, having obtained approval on its Environmental Exploration Application last December. It has two exploration licences for the region. But according to CNOOC's website, plans to drill an exploration well in the second quarter of 2020 were put on hold due to the COVID-19 pandemic.
The global pandemic and a volatile market for oil and gas products has cost the sector dearly, resulting in mass layoffs at multiple companies with operations in Newfoundland and Labrador. Husky Energy is currently reviewing its West White Rose project.
Last month, the federal government announced a $320 million fund to support workers in Newfoundland and Labrador's offshore sector. A task force was subsequently established to explore how to allocate those funds.
Shortly before the federal government's announcement, the province launched a new initiative to help encourage oil companies to drill more wells by allowing forfeited security deposits on successful exploration bids to be reinvested into offshore exploration projects. In the past, those deposits were forfeited outright if the company failed to meet its work commitment.