Category Archives: Energy

Suncor to abandon Terra Nova offshore oil field

Terra Nova FPSO offshore oil production platform and supply ships at well 350km south east of St John's. Photo by Greg Locke © 2009 Copyright.

Terra Nova FPSO offshore oil production platform and supply ships at well 350km south east of St John’s. Photo by Greg Locke © 2009 Copyright.

St. John’s, Newfoundland (May 27, 2021) – Calgary based Suncor Energy, lead operator of the Terra Nova offshore oil field on the Grand Banks of Newfoundland, says it will most likely be abandoning the oil field if it cannot come to an agreement with its seven partners.

Mark Little, the CEO of Suncor, told investors on Wednesday that the floating production platform will be decommissioned if an agreement is not found.

The Terra Nova FPSO was supposed to go to a dockyard in Spain last year when the COVID-19 struck. The ship is now tied up in Bull Arm, Newfoundland in need of a major overhaul that is estimated to cost $500 million.

It will represent the loss of approximately 850 direct jobs, thousand in the supply sector and royalty revenues to the provincial economy.

The project began in 2002 and was the second offshore oil field to go into production following the Hibernia project. This would represent a premature end to the field which is estimated to have 80 million barrels of recoverable oil remaining and 10 years more lifespan.

Suncor’s partners in the Terra Nova are ExxonMobil Canada Properties, Equinor Canada (formerly Statoil), Cenovus Energy subsidiary Husky Energy, Murphy Oil Company, Mosbacher Operating and Chevron Canada Resources.

Final decision is expected on June 15th.

Also posted in All, Business, Canadian Journalist, Current Affairs

Muskrat Falls hydroelectric – Who buried the risk assessment report?

Muskrat Falls, Labrador. Site of a proposed hydro electric project by the governments of Newfoundland and Quebec. This is downriver from the Churchill Falls Hydro project in Labrador. Photo by Greg Locke © 2017 DCS Files

Muskrat Falls on the Churchill River, Labrador in 2006 before construction of an ill-conceived hydro-electric project by the government of Newfoundland and Labrador.  Photo by Greg Locke ©2017

November 25, 2017

ST. JOHN’S, Newfoundland — The man in charge of finishing the Muskrat Falls hydroelectric project on the Churchill River in remote central Labrador calls the venture a “boondoggle”. The Newfoundland and Labrador government has established a commission of inquiry to determine why the project is wildly over budget and years behind schedule. A good place for the Commissioner, Judge Richard D. LeBlanc, to start is to find out who buried the warning that there was a “very high risk” of a multi-billion dollar cost overrun barely four months after the massive project was green-lighted in December, 2012.


The warning came in the form of a risk assessment undertaken by SNC-Lavalin, the engineering company retained by the Nalcor Energy, the provincial government agency managing the project. SNC-Lavalin officials, who were responsible for construction management and procurement on the project, conducted the risk assessment when initial prices for some major construction elements came in well above the original estimates in the $6.2 billion December, 2012 budget. The experts at SNC-Lavalin warned their Newfoundland client the project could go over-budget by an additional $2.4 billion. The warning was buried for four years.


Some critics of the Muskrat Falls project argue that warnings were ignored long before 2013but when the SNC-Lavalin risk assessment finally surfaced in June of this year it was too much to ignore and according to Newfoundland and Labrador’s premier Dwight Ball too late to put the brakes on the project


 According to Nalcor Energy’s CEO, Stan Marshall, the Province is now staring at a total cost of $12+ billion to bring the megaproject in two years behind schedule and the Province wants Judge LeBlanc to inquire into “any risk assessments, financial or otherwise” and whether “Nalcor took possession of the reports” and “made the government aware of the reports and assessments”


Judge LeBlanc will find that, yes, there was a risk assessment done by SNC-Lavalin in April, 2013 and maybe Nalcor Energy took possession of it or maybe not, and according to the provincial Minister of Natural Resources in April, 2013, no, the provincial government was not made aware of the SNC-Lavalin risk assessment.


Ed Martin, former president and CEO of Nalcor Energy. Photo by Greg Locke © 2017

Ed Martin, former president and CEO of Nalcor Energy. Photo by Greg Locke © 2017

What is a matter of public record is the following: Ed Martin, Nalcor Energy’s CEO, parted company with the provincial government in 2016. Whether he was dismissed or resigned is still a bit of a puzzle, but he was succeeded by Stan Marshall, a very successful executive with the private energy company, Fortis Inc. Stan Marshall says he heard about the 2013 SNC-Lavalin risk assessment from a former SNC-Lavalin engineer, but could not find a copy of it in Nalcor Energy’s files. Finally, Stan Marshall says he asked SNC-Lavalin for a copy of the risk assessment, received it, gave it to the provincial government, and it was released by the Premier and Minister of Natural Resources on June 23, 2017 (External Link to CBC story)


A spokesperson for SNC-Lavalin told The Telegram newspaper and that they “attempted” to hand over the risk assessment to Nalcor. Ed Martin, the former Nalcor CEO told the media the risk assessment was never “presented” to him. Premier Dwight Ball told the media that he had been advised that the risk assessment results were presented by SNC-Lavalin at a meeting attended by Nalcor officials including Ed Martin. Obviously, either Premier Dwight Ball has been poorly advised or Ed Martin is not telling the truth or the word “presented” has a very narrow and specific meaning in the world of engineers and consultants that outsiders fail to understand.


The expression “attempted to hand it over” makes one wonder if an official of SNC-Lavalin held the nine-page risk assessment document in their hand and reached out to give it to a Nalcor Energy official who refused to accept it. Or, maybe there was a meeting where the SNC-Lavalin, motivated by what is described in the risk assessment as a sense of “urgency” to convey their findings verbally briefed Nalcor Energy officials on the results of the risk assessment, but did not have the report in hand. When engineers are under oath and lawyers from Judge LeBlanc rather than journalists are asking questions about who told who what and who gave what to who then the people who will ultimately pay for the “boondoggle” will know who buried what.


What does not take any clarifying are the words of Tom Marshall, the provincial Minister of Natural Resources in 2013. When the SNC-Lavalin risk assessment surfaced in June, 2017. I asked Tom Marshall if he saw the risk assessment in 2013. He said, “I never saw that report.” Asked if he had been advised of the risk assessment findings Mr. Marshall said, “No.” Did he think Ed Martin, the Nalcor CEO who he met with regularly at the time, held back the risk assessment’s findings Mr. Marshall said, “That would be terrible. I can’t fathom if that is the case.” Would it have made a difference if he had known? “It would have rung all kinds of alarm bells”


Eleven months after the SNC-Lavalin risk assessment warning Tom Marshall’s successor as Minister of Natural Resources, Derrick Dalley addressed the House of Assembly to reassure members that the government’s oversight of the Muskrat Falls project was “robust.” Mr. Dalley said, “senior staff with the Department of Natural Resources and Finance have met regularly with Nalcor’s CEO and their staff. As well, the provincial cabinet has had regular meetings and ongoing reports from the CEO of Nalcor”


For those who gamble on political affairs the question Mr. Dalley’s assurances in 2014 raise is this; what are the odds that Judge LeBlanc will hear testimony from one single senior staff or cabinet member who met regularly with the CEO of Nalcor who will recall hearing the words, “SNC-Lavalin risk assessment” or “serious concerns” or “very high risk of cost overruns” in any of those meetings?


Two days later the Minister again sought to reassure the members of the House of Assembly that there was no very high risk of cost overruns, “Nobody is putting my signature on a paper that costs my children $6 billion and $7 billion into the future. I can tell you the work is done. The oversight is there” he said.


When the Muskrat Falls Inquiry releases its schedule of witnesses make a note of the date of Mr. Dalley’s appearance.


Copyright Roger Bill 2017


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Also posted in All, Canadian Journalist, Environment Tagged , , , , , , , |

Little Stephen in the Land of Oz

Published September 12, 2013

The Majuro Declaration. Ever heard of it? I thought not.

The two-page document was released Sept. 5 by a group of 15 small Pacific island nations, and two somewhat larger Pacific island nations — New Zealand and Australia. It was promptly hailed by the few climate cogniscenti who were aware of it as a breakthrough in candor, if nothing else, about the gravest crisis facing the world.

No, not Syria. The crisis that is on a trajectory to exterminating most of Earth’s life forms and sharply reduce humanity’s numbers. That crisis.

The crisis in our natural security is occurring in several theatres, but climate change is its central front. And the Majuro statement was one of the more straightforward dispatches from that front in some time.

It declared that present responses to climate change leave several Forum members facing, “catastrophic impacts on the security and livelihoods of our people.” Indeed, they face an existential peril far more profound than Syria’s. The place we call Syria will still be there when the present crisis is history. As things are going the low island territories will simply cease to exist, becoming nothing more than haunted hazards to navigation.

The only way — just perhaps, and with much luck — to preserve these nations, the statement declared, would be “the urgent reduction and phase-down of greenhouse gas pollution.”

As it happened, on the same day that the Pacific Island Forum released its declaration — with Australia adding its imprimatur — Australians themselves were heading to the polls. They delivered a solid Aussie thumping to the party that had agreed to the Majuro statement.

Voters replaced the Labour government of Prime Minister Kevin Rudd with the (not remotely) Liberal Party led by Tony Abbott. Five days later, Abbott repudiated not only the Majuro Declaration’s alarm, but most of the policy response Labour had set in place to contain climate change.

Just as he had promised during the campaign, Abbott scrapped Australia’s carbon tax and its program for emissions trading—the two public policies judged most effective at reducing carbon emissions at the lowest cost to society.

The Aussies have installed in Canberra a spiritual twin to the man who has led Canada, its elder Commonwealth sibling, for the last seven years: Stephen Harper, an anti-charismatic economist. Whether this turns out to be a good thing for Australia’s voters is for them to decide.

It’s almost certainly a very bad thing for the world.

Australia is the world’s largest exporter of coal—the only fossil fuel even dirtier than Canadian bitumen steam-cleaned from the tar sands. And Abbott is as starry-eyed a cheerleader for coal as Canadian Prime Minister Stephen Harper is for Alberta’s bitumen.

Stephen Harper voices a watery acknowledgement of the reality that human carbon releases are contributing to climate change and consequential changes for the worse in the weather. Aussie Abbott is more Crocodile Dundee on the subject: “The climate change argument is absolute crap.”

Abbott is Australia’s Harper in another revealing way (even beyond the fondness for Orwellian misdirection suggested by his party’s name.)

He is not fond of facts. As he was rubbishing Australia’s best chances to wind down its carbon releases painlessly, Abbott also eliminated its independent Climate Commission, a source of science-based information on the subject for Oz’s voters and legislators.

Canada, needless to say, doesn’t even have such an agency to be scrapped. (The United States, by comparison, does; America’s Department of Agriculture alone, aware of the vulnerability of food supply to climate, has three.

If Abbott is following Harper’s playbook, Australia’s scientists should be polishing their resumes, especially any in the biological and environmental sciences. Or anywhere, really, where they might trip over evidence that wild and human life may suffer a little as it adjusts to the wholesale realignment and amping up of the Earth’s weather systems.

Harper’s cabinet has closed one leading Canadian science platform after another—only pausing at the eleventh hour before delivering a coup de grace to the internationally renowned Experimental Lakes Area, a globally unique open-air ‘laboratory’ that allows scientists to examine entire watersheds, after its death sentence ignited a national hue and cry.

Abbott has warned that once “bureaucrats” in places like Australia’s Climate Commission are done away with, “I suspect we might find that the particular position you refer to goes with them.”

The ‘particular position’ Abbott was talking about was, in this case, the finding by Commission scientists that climate change is making Australia’s already extreme weather, worse.

(When the long-valued, independent and non-partisan National Round Table on the Environment and the Economy had the temerity to examine the merits of a carbon tax for Canada, the Harper government eliminated it, too.)

Three days before the election, the Australia Bureau of Meteorology reported that the country had just experienced its hottest 12 months on record. The September issue of the American Meteorological Society Bulletin concluded that climate change had contributed to the torrential rains that produced calamitous flooding in southeastern Oz early in 2012.

Even U.S. President George W. Bush, not normally known for his acuity, recognized in a State of the Union address that the world’s largest economy was “addicted” to fossil fuel. Now that our global addiction is showing unequivocal signs of leading us to a painful, early death, two of the world’s biggest stashes are in the hands of hard-core pushers deep in their personal denial.

Copyright © 2013 Chris Wood


References and further reading:
New Scientist report on Australian election
American Meteorological Society
U.S. 2007 State of the Union Address 
Majuro Declaration  (PDF)


Also posted in All, Environment Tagged |