Evidence of meeting #83 for Natural Resources in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was projects.
A video is available from Parliament.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
In a case such as where the licences were cancelled off Sable Island in November after being awarded in October for exploration, what kind of message do you think that might send to those who want to invest in exploration in Canada's offshore?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
I'm going to assume that one was for me as well.
That one is outside my purview. That's in the remit of the Nova Scotia regulator, the province and the federal government.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
We'll get back to that one after, then.
You were the head of the board in 2013 and obviously in 2014, 2015 and 2016 as well. Back in around 2015 and 2016, what kind of money was invested in placing bonds on parcels that were offered up in Newfoundland and Labrador's offshore? What would be the typical number of parcels that would be offered up?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
I think members would be aware that there were some significant bids in the 2015-16 period, including, I believe, record bids in 2016. I stand to be corrected on that.
The investment in our licensing rounds varies. It ebbs and flows with global industry conditions, money available for exploration and the activities of local operators and potential new entrants. It can vary widely from year to year.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
In 2023, we had 37 parcels offered up. Would you consider that to be average or above average in terms of parcels offered up?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
There were 47 parcels on offer in 2023. There were zero bids received. That was the most we've offered in terms of acreage.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
It was the most offered and there were no bids. Is that correct?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
That is correct.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
How much would a typical exploration company spend on purchasing data and on their personnel and whatnot in the process of placing a bid?
Do you have a ballpark, a range, of what those exploration companies would invest under one of those scenarios?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
I don't know if I could give a typical number. It would be in the millions of dollars, but it would vary widely on the parcel offered, the experience of the company, whether or not they've worked here before and exactly what their program is for data acquisition. It could be a wide range.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
Would you say that stability of regulation would be a factor when a company is investing their personnel, their time, their energy and their precious resources? Do you think stability of regulations would be a factor for them in putting the time and energy into creating a bid?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
It would certainly be one of several factors, yes.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
Thank you.
Do you know how many companies purchased data to put in a bid in the first half, say, of 2023?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
I'm not sure I follow the question. There were no bids received, so I'm not sure what sort of data acquisition went down behind the scenes. We wouldn't necessarily be privy to that.
Conservative
Clifford Small Conservative Coast of Bays—Central—Notre Dame, NL
Could it be possible that no bids were made as a result of proposed section 56 in Bill C-49? It's referenced in item (g) in the bill summary. I'll read from the bill summary just to make it simple. It says, “provide that the Governor in Council may make regulations to prohibit the commencement or continuation of petroleum resource or renewable energy activities, or the issuance of interests, in respect of any portion of the offshore area that is located in an area that has been or may be identified as an area for environmental or wildlife conservation or protection”.
Liberal
The Chair Liberal George Chahal
Mr. Small, your time is up.
Mr. Tessier, could you provide a brief answer, please? If you need further clarification, it can be asked for at a later time.
Go ahead, Mr. Tessier.
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
The reasons why a company may or may not bid are as varied as the companies themselves. I can tell members that, in my discussions with operators in our offshore area, I have not heard Bill C-49 referenced as the reason why they did not bid.
Liberal
The Chair Liberal George Chahal
Thank you, Mr. Tessier.
We will now go to Ms. Jones from the Liberal Party of Canada for six minutes.
The floor is yours.
Liberal
Yvonne Jones Liberal Labrador, NL
Thank you very much.
I'd like to thank our witnesses who are here with us today and acknowledge the tremendous work they've done both in Nova Scotia and in Newfoundland and Labrador in building a very stable energy market for investors, creating jobs and strengthening the economy.
I'm very pleased to hear today as well that you're supporting Bill C-49 because, as a lead regulator in both of these provinces, it is so important to have an independent agency like yours looking objectively at this legislation to ensure it's strong and effective for the provinces it affects. We know how critical your role is in delivering offshore wind projects in Atlantic Canada.
I think my colleague opposite was trying to establish that, because of Bill C-49, there have been no bids in the offshore oil and gas. Well, I remember many years of parcels being called for bid in Labrador with no bidders. It happened long before this past year, and it happened for many different reasons, as we know. I'm glad you were able to clear that up.
My question today is really around the regulatory piece and the safety and protection of workers. Always in Newfoundland and Labrador, we have fearless employees and skilled workers who work in the offshore oil industry and the offshore fishing industry and have spent most of their lives on the ocean in one capacity or another.
My question is for both of you. When you look at what we're doing under Bill C-49 in offshore wind, are you comfortable that we can ensure the safety and protection of these workers in the offshore and that we're able to meet the future mandates that have been established for energy development under this act? I think those are very important questions as we move forward with the bill.
February 5th, 2024 / 4:20 p.m.
Chief Executive Officer, Canada-Nova Scotia Offshore Petroleum Board
Thank you for the question.
With respect to transitioning with an expanded mandate and still being the regulator for oil and gas as well as the regulator for the offshore renewable energy industry—primarily, right now, it's looking to be that the first type of offshore renewable energy will be offshore wind—the governments write the legislation and the regulatory regime, which we administer on their behalf.
When you look at occupational health and safety, which is very important, because an important part of our mandate is worker safety, in part III.1, the occupational health and safety requirements for any type of activity that occurs offshore will be the exact same requirements or almost identical requirements for offshore renewable energy. A primary and an important part of our mandate is the safety of offshore workers and operations and the protection of the environment. Those important parts of our mandate will remain when we are the regulator for the offshore renewable energy industry.
Liberal
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
I would add that, in our engagement with our counterparts from around the world, what we're seeing and hearing from them—and some of them are further ahead of us in terms of the expansion of their mandates—is that the skill set for the regulation of offshore safety is very transferable from the petroleum sector to offshore renewable energy.
We're in good standing in terms of our preparedness and readiness to take on the expanded mandate.
Liberal
Yvonne Jones Liberal Labrador, NL
My next question is around the consultation process that your boards would conduct.
You talked about consulting with fisheries and indigenous people in those areas and with other stakeholders as well. Obviously we know how critical it is that we have a strong, sustainable fishery in Atlantic Canada as well.
Can you walk us through what would be the involvement and the process of the C-NLOPB or the CNSOPB in sanctioning alternative energy programs for the offshore?
Chief Executive Officer, Canada-Newfoundland and Labrador Offshore Petroleum Board
I can begin.
With respect to Bill C-49, the consultation is being led by the Government of Canada and the two provincial governments. The regulators are not leading on those consultations.
We do have extensive experience in engagement with fishery stakeholders in the petroleum space, and we are aware that various interests in the fishery sector have concerns with respect to the expansion of activity in the ocean. We're very committed to working very closely with fishery stakeholders and indigenous groups to ensure there is effective communication, transparency and co-operation both in planning and on the water.
Liberal