Pipeline Magazine


Husky Oil to proceed with West White Rose project off Newfoundland

ST. JOHN’S, N.L. – The Newfoundland and Labrador government was exultant Monday as Husky Energy announced it will finally proceed with the multimillion-dollar West White Rose project, with first oil five years away.

The company said it will use a fixed wellhead platform tied to the SeaRose floating production, storage and offloading vessel, known as an FPSO. First oil is expected in 2022 and could reach a gross peak production rate of approximately 75,000 barrels per day by 2025.

“Moving forward with this project is a significant milestone for Husky, while creating jobs, royalties and other benefits for Newfoundland and Labrador,” CEO Rob Peabody said in a statement.

“This project is of a scale approaching the original White Rose development and is able to use the existing SeaRose FPSO to process and export production.”

Premier Dwight Ball said construction will start in Argentia, N.L., this year. It will employ about 700 people at peak, he said. Accommodation design and other components will add to that total.

Direct benefits will include more than $3 billion in royalties, equity and taxes.

It’s much-needed economic good news in a province that has reeled since the collapse of oil prices starting in 2014 hammered its finances.

There is much more oil to tap, Ball said: “Our future is bright.”

Natural Resources Minister Siobhan Coady said the commitment showed the industry has confidence in Newfoundland’s offshore potential and workforce.

“We are very excited,” she told a joint news conference with Husky Energy in St. John’s. “This commitment is a vote of confidence in the province’s knowledge, skill and expertise.”

“There is no doubt that today is a great day for our province and a milestone for our oil and gas industry.”

Malcolm Maclean, senior vice-president of the Atlantic region for Husky Energy, said the venture is going ahead at a time when few developments of its size are proceeding. He said it was a difficult decision in 2014 to delay the expansion.

It is going ahead now in part because initial estimates of 230 million barrels of recoverable oil have almost doubled, he told reporters. He said new discoveries are still being assessed.

The company said incremental operating costs are expected to be less than $3 per barrel over the first 10 years with the tie-back to the SeaRose operation.

It says the net project will cost $2.2 billion to first oil and is expected to create about 250 permanent platform jobs once operational.

The company also announced a new oil discovery at the Northwest White Rose, showing a light oil column of more than 100 metres.

Discovered in 1984, the main White Rose field is located about 350 kilometres east of St. John’s. Commercial oil production from the White Rose field began in November 2005.

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