N.L. faces hard economic times during pandemic
The global COVID-19 pandemic is spelling trouble for Newfoundland and Labrador's oil and gas industry
ST. JOHN’S, N.L. – The global COVID-19 pandemic is spelling trouble for Newfoundland and Labrador’s oil and gas industry, adding to existing economic challenges in the cash-strapped province.
Premier Dwight Ball acknowledged on March 17 the province is experiencing “tough times,” referencing deferred investment on projects and historic lows in oil prices.
Earlier that day, Equinor and Husky Energy announced the decision to defer the Bay du Nord offshore development project due to falling oil prices and economic downturn as countries respond to the novel coronavirus.
The project in the Flemish Pass Basin, about 500 kilometres east of St. John’s, was announced in 2018 but not yet officially sanctioned. Equinor had set a target of 2020 to decide.
The Bay du Nord project was expected to deliver first oil by 2025. It was a key part of the province’s plan to rapidly increase offshore oil and gas development, including a goal to double production to more than 650,000 barrels a day by 2030.
Ball urged the federal government to take quick action on financial support for provinces on Wednesday but said Ottawa should not respond with a one-size-fits-all approach.
“My message to the federal government is, it’s urgent to get this money moving,” Ball said on March 17 in a prepared statement.