Newfoundland oil battle worth $100M
Jul 13, 2012 / 9:26 am
Premier Kathy Dunderdale and oil giant ExxonMobil are still at odds after meeting today to discuss construction of a $100-million piece of the Hebron project off Newfoundland.
As part of a benefits agreement, Dunderdale says she wants all three major components of the platform built in the province.
The premier says the province can handle the work, but ExxonMobil says its studies show building the third module in Newfoundland would delay first oil expected in 2017.
Dunderdale says the province is now studying a report from the company before the two sides meet again later this summer in an effort to avoid arbitration in the ongoing dispute.
That dispute resolution process could slap the development partners, led by ExxonMobil, with fines in the tens of millions of dollars.
The Hebron oilfield 350 kilometres east of St. John's is estimated to hold up to 700 million barrels of oil.
Development partners include Chevron Canada, Suncor Energy (TSX:SU), Statoil Canada and provincial Crown corporation Nalcor Energy. Newfoundland and Labrador has a 4.9 per cent equity stake in the project.
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