It has been proven time and time again that Newfoundland and Labrador’s (NL) offshore oil and gas industry has notoriously long development cycles. How can the industry compete on a global scale when the industry can’t keep pace with other leading offshore oil and gas jurisdictions?

One such example of the competition the industry is facing is Norway. With more than 80 operating fields, Norway has refined new systems and practices to speed up projects, without risking the safety of their workers or the environments they develop. Since 1960, Norway’s average development cycle, from discovery to first oil, is 13 years. How can Newfoundland and Labrador contend when it’s average development cycle is 24 years?

As global competition heats up, development cycles are becoming shorter all around the world. To keep up, the province must address the fact that its oil and gas industry is at risk of falling behind. If the province hopes to attract investors and grow, it must pick up the pace.

That is why CAPP is calling on all levels of government and regulators to work together to improve the efficiency and effectiveness of regulatory processes. The province must look for opportunities to make potential developments more economic and find ways to improve timelines. This issue must be addressed quickly, or the Newfoundland and Labrador oil and gas industry may be left behind in the global competition for investment.

“We need to really think differently. We need to be more competitive because the price of oil is lower and we have more competition in other, unconventional oil industries.”

Mike Ryan
Vice-President, ExxonMobil Canada

Hebron Development Cycle

A variety of factors can influence project timelines. Newfoundland and Labrador’s most recent project, Hebron, took over 30 years to go from discovery to first oil. In today’s world, a long development cycle is becoming less attractive to oil and gas companies because of the length of time it takes to get a return-on-investment and the risks involved.