Newfoundland and Labrador resource assessment shows significant oil and gas potential

ST. JOHN’S, NEWFOUNDLAND – Newfoundland and Labrador’s 2020 Independent Oil and Gas Resource Assessment results show 11.1 billion barrels of oil and 24.5 trillion cubic feet of natural gas potential offshore. The assessment findings were released today in partnership with the Government of Newfoundland and Labrador, Nalcor Energy-Oil and Gas and Beicip-Franlab in advance of the Call for Bids on November 4, 2020.  

“The magnitude of Newfoundland and Labrador’s resource potential continues to grow exponentially. In just 10 per cent of our offshore we now have a combined resource potential of 63.3 billion barrels of oil and 224.1 trillion cubic feet of gas,” said the Honourable Andrew Parsons, Minister of Industry, Energy and Technology. “In order to realize this significant resource potential and assist companies in achieving their exploration objectives, we have announced the establishment of a new offshore exploration initiative to incentivize near term drilling activity and enhance global competitiveness at this critical time.”

This year’s independent resource assessment is based on new data covering six parcels on offer within the Orphan Basin (parcels NL20-CFB01-06 to 11) in the area of the Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB) 2020 Eastern Newfoundland Call for Bids.

“For the first time in our offshore, 90 percent of the license round is covered with 3D seismic data and the remaining 10 percent is covered by 5x5 2D which has provided us with an enhanced  level of certainty in these  resource numbers,” said Jim Keating, Executive Vice President, Offshore Development. “The significant amount of data covering the area and the evolution of information gathering has presented greater imaging and a deeper understanding of the resource density, enabling us to identify over 40 prospects in an area.”

The resource assessment is based on multiple scenarios of geological models.  All scenarios were calibrated to well and seismic data Nalcor collected with partners TGS and PGS which has provided a robust range of outcomes. Detailed technical work defined the nature and extent of the findings and further details are contained in the assessment report.

“Beicip-Franlab has carried out detailed interpretations of past and new data, well and seismic, in the Orphan basin. The data integration allowed the use of leading edge modeling techniques to rigorously assess uncertainty and risk, through equiprobable resources scenarios. Preliminary exploration efforts had not identified accumulations but our new comprehensive analysis of the petroleum system confirms the existence of significant hydrocarbon potential in the area,” said Jean Burrus, CEO, Beicip-Franlab.

Newfoundland and Labrador’s offshore spans 1.8 million square kilometers with its oil reserves emerging as some of the most carbon-competitive in the world. The 2020 license round area is located approximately 250 kilometres north-northeast of St. John’s in water depths ranging from 270 to 3,100 metres. The call includes 17 parcels of land and a total of 4,170,509 hectares. Six of the parcels in the Orphan Basin area are newly posted acreage and are the focus of the 2020 Independent Resource Assessment covering 15,000 square kilometres.

This is the province’s fifth scheduled license round. Future license rounds scheduled through 2024 will follow the same process with detailed resource assessments being conducted and released prior to bid closing.