Baidu Nord will produce more oil than expected: groups decry valuation

Stephen Bliss, The Canadian Press

MONTREAL – Environmental groups denounce the “absurdity” of the environmental assessment of the Baie du Nord project as the amount of oil that can be produced is adjusted upward by Norwegian oil giant Equinor.

The Federal Environmental Assessment of the Bay du Nord project was not carried out taking into account how much oil could be extracted from the Atlantic Ocean, which is further reason to demand its withdrawal, according to Greenpeace and the Sierra Club.

Ce n’est plus “environ 300 millions de barils de pétrole brut” que Bay du Nord pourrait produire, comme il est indiqué dans le résumé du projet présenté par l’entreprise Equinor en juin 2018 à l’Agence d’évaluation d’impact form Canada.

Three weeks after receiving Environmental Department approval for an offshore oil project in Newfoundland, Equinor spokeswoman Alex Collins told The Canadian Press Thursday that the company now believes it can extract “more than 500 million barrels” of crude.

This 67% increase in production estimated by the company was first reported by Radio Canada on Thursday.

Equinor has confirmed to The Canadian Press that its exploration work has not been completed. So it could revise its estimate up again, and much more if we believe a press release published by Energy NL, a consortium of companies in the energy sector, in November 2021.

Al Cook, one of the company’s executives, told investors at the time that “Bay du Nord has the potential to become larger than Bacalhau,” a Brazilian oil project with “a billion barrels” of reserves.

Evaluation does not take into account the quantity

Asked whether Canada’s license from the Department of Environment and Climate Change for the project supported unlimited oil production by Equinor, the ministry replied that the “Federal Environmental Assessment” of the Pays du Nord was based on “project location, number of years, components and activities” and not on “the amount of oil that The project was expected to produce it.”

The Ministry of Environment, in a statement sent to The Canadian Press, explained that the assessment also took into account “the possibility that Almoayyed will find other oil reserves” and that “the potential impacts of development extend beyond the boundaries of the central development zone.” It was also taken into account.

Greenpeace Canada calls the assessment ‘ridiculous’

“We have to stop this project, we have to have a real assessment that allows us to understand what the overall impact will be. Greenpeace Canada spokesperson Patrick Bonin said:

He considers it “problematic” that we do not know the estimate of the amount of greenhouse gases that the Baie de Nord will produce, in the context of “we do not know whether it is 300 million barrels, 500 million barrels, even a billion barrels” of oil that will be produced.

The same story is given by environmentalist Gretchen Fitzgerald of the Sierra Club, who argues that “inflated estimates of projected oil production in the Gulf of Nord are alarming for our climate and show the absurdity of the environmental assessment that was made for this project.”

According to Equinor, the project will emit 8kg of carbon dioxide for every barrel of oil extracted, and the environment ministry says this oil will be “ten times less polluting” than oil extracted from oil sands.

But Greenpeace deplores the government’s failure to explain that extracting this type of oil “accounts for about 10% of oil-related greenhouse gas emissions”, while 90% will occur when burning oil.

The Bay du Nord project, which is supposed to run for 30 years, is scheduled to start operation in 2028.

“On the other hand, Canada claims that it wants to achieve carbon neutrality by 2050, and there we have a company that keeps amplifying a project that was already completely unacceptable, and we already had 300 million reasons to reject it and there, it got to 500 million,” Patrick Boonen summed up.

The decision of the Ministry of Environment to allow this giant oil project is still criticized by environmental groups, especially since it happened last April, a few days after the group’s last report was published. The Intergovernmental Experts on Climate Change (IPCC) and the United Nations Secretary-General, António Guterres, described new investments in the fossil fuel sector as “moral and economic insanity”.

Bay du Nord will be Canada’s first deepwater project to produce oil, with wells about 1,200 meters deep, pumping hundreds of thousands of barrels of oil per day.

Led by oil giant Equinor, the project is expected to pump billions into the coffers of Newfoundland and Labrador.