Latest news with #ToreLøseth
CBC
4 days ago
- Business
- CBC
Bay du Nord FPSO contract will be awarded in months but future undecided, says Equinor
While the future of the stalled Bay du Nord project has yet to be decided, an Equinor Canada representative says there are positive signs for the project's future, including a major contract that the oil giant will award in the next few months. The project's hiatus was announced in May 2023 and at the time, the company blamed "challenging market conditions" that forced project costs skyward. "We are now pretty much ready to select a tier-one FPSO contractor," Equinor Canada's country manager Tore Løseth told reporters on Thursday. Løseth, who was attending the final day of Energy N.L.'s annual conference in downtown St. John's, also reiterated previously announced plans for a phased approach, first launching production in the two most promising fields: Bay du Nord and Cambriol. "We have now a path forward that we think can work. We really hope so. We're not there yet," he said. Equinor says it will make a financial investment decision by 2027 and if it moves forward, first oil would come in 2031. Even without the decision, Løseth says issuing contracts for work is necessary in Bay du Nord's case. "Since this is a complicated project to get across, we need all the good ideas we can have and we need all the experts on board. So this project, we are getting the contractors on board a little bit earlier than we usually do." Løseth says his team has done a lot of work to change the project and it's now stronger, but prices have continued to climb in the last two years. That means additional work with contractors. "I cannot promise you today, but I really hope that we can make it a sanctionable project," said Løseth. 'We'll be shattered' Rob Strong, the founder of Rob Strong and Associates, says much is riding on the project for the province more broadly, adding companies will be "devastated" if it doesn't go ahead. "I think we'll be shattered, basically. We need another project. Yes there's lots of activity and lots of employment and ongoing steady, stable operations for Hibernia, Hebron, Terra Nova and White Rose," he said. "But many companies here in Newfoundland are gearing up for the actual fabrication and the subsea installations." Strong is optimistic the project will ultimately be approved, though he says the company has a tight deadline if it wants to get first oil by 2031. "It's a very tight timeline for three years to finally commit for construction and get [the FPSO] constructed," said Strong. Premier John Hogan, speaking to conference attendees before Løseth's update on Equinor, had a positive outlook on the project's future. "At the first ministers' meeting this week in Saskatchewan I was proud to explain to my fellow premiers and the prime minister the real, substantial, nation-building opportunity we hold here in Bay du Nord," said Hogan. When speaking with reporters, Prime Minister Mark Carney included Bay du Nord on a list of potential projects that could be fast-tracked under a new approval process because of their nation-building importance. Løseth says he appreciates Carney mentioning the Bay du Nord project, but added it wasn't for Løseth to decide if it should be considered a "nation-building project." "We are just focused on delivering Bay du Nord," he said.
CBC
02-05-2025
- Business
- CBC
Equinor sets 2031 as new target for first oil at Bay du Nord
Oil production at Bay du Nord is now slated to begin in 2031, with the director of the stalled offshore project saying he's "cautiously optimistic" it will go ahead. That's about three years later than previous estimates, made before Bay du Nord was put on hold nearly two years ago. Bay du Nord — which would be Canada's first deep-water oil project — was paused by Norwegian energy giant Equinor in May 2023, sending shockwaves through the Newfoundland and Labrador oil industry amid an energy conference in St. John's happening at the same time. The company blamed "challenging market conditions" that forced project costs skyward. "It's a difficult project because it's 500 kilometres offshore, it's 1,000 metres of water depth. Icebergs and so on. So it is a costly endeavour. There is no infrastructure out there," Tore Løseth, Equinor's manager for Canada, said on Tuesday. Løseth said despite nearly two years of efforts to "reshape the project," he's still unsure whether Bay du Nord will become a reality. "We don't have a project yet. We're not certain we can make it work," he said. The company has been reviewing its project design since that hiatus. The plan initially aimed to extract crude oil from five oil fields in the Flemish Pass, an area 500 kilometres east of St. John's that represents a new frontier for Newfoundland and Labrador's oil industry. Thousands of jobs have been promised, as well as billions of dollars in royalties for the heavily indebted provincial government. Equinor is now aiming for a phased approach, first launching production in the two most promising fields: Bay du Nord and Cambriol. "We have a great project team that has done a lot of work to improve the project. And so now the project looks different because we've improved it," Løseth said. The production, storage, and offloading vessel that Equinor intends to build will also be manufactured by a third-party contractor. It will therefore be built faster and cost less, Løseth said, without specifying where construction will take place. A decision to move forward to the project's next phase, leading to further engineering and planning work, is expected by the end of the year. A final investment decision is expected in 2027. "When you make a huge investment decision like that, there's a lot of risks. One of the risks, and one of the things we are focusing on, is what oil price level do we need in the future actually to have a profitable project, to make money," said Løseth. He said the project remains an important one for Equinor and his confidence in the project can vary on any given day. "You have seen all the work that we have put in. We have not given up," he said. "But at the same time it needs to be an investment proposition that makes sense. So we see a good future. If we can make it work, like I said, there's a longevity to the Bay du Nord project and the Flemish Pass Basin."
