Premier Welcomes Record Exploration Call
Premier Russell MacLellan says a call for more exploration licences shows the growing strength of the provincial energy sector.
"Companies have been approaching the Canada-Nova Scotia Board telling them they want to be part of the most exciting energy play in Canada today," the premier said. "Now they have their chance to explore, discover and develop the energy potential of our coast."
The Offshore Board has issued a call for 20 exploration licences covering approximately 2.2 million hectares of offshore Nova Scotia. It is the largest exploration call in the history of the Nova Scotia offshore.
Bidding on each parcel will be based on how much money companies propose to spend on exploration during the first five years of the nine year license. The minimum acceptable bid for each land parcel is $1 million. The call will remain open until Apr. 29, 1999.
To protect the environment, the board will not permit drilling on Sable Island or within one nautical mile of the island. "Sable Island represents part of our natural and historical legacy that we must preserve," said the premier, who is also Minister responsible for the Nova Scotia Petroleum Directorate.
The increase in interest in the offshore is partly attributable to the establishment of generic royalty rules to cover all new offshore activities. The royalty regime, introduced by the premier in August, permits companies to understand their financial obligations to the province before they begin drilling.
This call for bids is the latest in a series of significant offshore related developments during 1998. The year began with the establishment of an enhanced royalty regime to cover the Sable Offshore Energy Project. The signing of a Memorandum of Understanding with petroleum and pipeline companies opened the way for lower transmission tolls for Nova Scotians.
In November, the premier released plans to offer natural gas access to all 18 counties of the province within seven years. The first natural gas from the Sable field comes ashore in November 1999. Approximately 2,000 people are currently working on the Sable Offshore Energy Project in Nova Scotia.