Equinor, BHP Secure Blocks off Eastern Canada

BHP and Equinor secured exploration blocks of the eastern Canadian province of Newfoundland and Labrador in a bid offering Wednesday that drew record high net bidding over C$1.3 billion.

BHP will operate two exploration parcels in the offshore Orphan Basin, NL18-CFB01-08 and NL18-CFB01-12, totaling 543,378 hectares. BHP's successful $621 million bid for NL18-CFB01-08 is a record, according to the Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB).

“This frontier opportunity has large oil resource potential which we identified through our Global Petroleum Endowment Study in 2016 and is in a low risk country, with competitive fiscal terms,” Steve Pastor, BHP President Operations Petroleum. “This opportunity delivers on our exploration focus in conventional petroleum and will leverage our global deep-water development and operational expertise.”

BHP said its aggregate bid amount covers the drilling and seismic work over a six-year term. The company’s minimum commitment under the licence agreements is for US$157 million. It added its initial planned capital expenditure on the exploration work programs for blocks 8 and 12 is US$140 million up to FY2021.

Equinor will operate two exploration parcels, NL18-CFB01-14 (Equinor Canada 70 percent, Husky Energy 30 percent) and NL18-CFB01-15 (Equinor Canada 60 percent, Suncor Energy 40 percent), totaling 412,644 hectares, and will participate in the Suncor Energy-operated parcel NL18-CFB02-01, totaling 142,448 hectares, (Suncor Energy 40 percent, Equinor Canada 30 percent, Husky Energy 30 percent).

“We are pleased to have secured significant acreage and new exploration opportunities offshore Canada. The successful bids aligns with Equinor’s strategy of developing our position in prolific basins,” said Tim Dodson, Equinor’s executive vice president for exploration.

“These exploration investments provide Equinor an important opportunity to advance our position in a region where we have a well-established exploration portfolio while we continue to evaluate and mature our existing exploration assets in the Flemish Pass Basin.”

Call for Bids NL18-CFB01 (Exploration Licences, Eastern Newfoundland Region) offered 16 parcels totaling 3,941,046 hectares.

Call for Bids NL18-CFB02 (Exploration Licence, Jeanne d’Arc Region) offered one parcel totaling 142,448 hectares.

The C-NLOPB said no bids were received for Call for Bids NL18-CFB03 (Production Licence, Jeanne d’Arc Region).

(Image: C-NLOPB)