Drilling results disappoint Equinor, as Bay du Nord project awaits final sanction
Efforts by Equinor to discover more oil reserves in a bid to bolster the business case for the Bay du Nord project have come up short, the company has confirmed.
Equinor and its partner, BP Canada, drilled an exploration well on a prospect called Sitka, and an appraisal well on a previous discovery called Cambriol, in the Flemish Pass this summer and fall, and the effort was a bust.
A spokesperson for Equinor said operational challenges forced an early end to drilling operations last month on the Sitka prospect before it could reach the area thought to contain oil.
The company did not elaborate on what the operational challenges were.
The company said it will now "take time to assess the operational challenges experienced with the well and conclude on further operational plans for the prospect at a later date."
And earlier in the summer, an appraisal well on the Cambriol discovery failed to find any oil or gas, the company said.
Both wells were drilled by the semi-submersible rig West Hercules.
Cambriol was one of two oil discoveries made by Equinor in 2020. The other was on a site called Cappahayden.
Equinor was hoping to make additional discoveries during its 2022 campaign which could be tied back to the company's planned Bay du Nord FPSO, which is a floating production, storage and offloading vessel similar to platforms already used in the White Rose and Terra Nova oil fields.
CBC News asked Equinor whether the results of this year's drilling campaign will have a negative affect on the overall project, but did not receive a response.
In June, however, an executive with Equinor told delegates at an energy conference in St. John's that preparations for Bay du Nord were moving at "full speed."
Equinor Canada president Torstein Hole said at the time that Bay du Nord will cost $16 billion to develop, inject some $10 billion in royalty revenue into the provincial and federal government treasuries, and create 16,000 person-years of employment during the life of the field.
At peak, the field will produce up to 200,000 barrel of oil per day, he said.
The Bay du Nord project consists of a half-dozen oil discoveries in the Flemish Pass basin, some 500 kilometres northeast of St. John's. The first oil discovery there was made by Equinor in 2013, followed by additional discoveries in 2014, 2016 and 2020.
The federal government gave environmental approval for the massive Bay du Nord project seven months ago, and Equinor has said a final investment decision could be two years away, with first oil by the end of this decade.
The company has confirmed the presence of 500 million barrels of proven, recoverable oil, but industry insiders have suggested the true number is closer to one billion barrels.
