Newfoundland welcomes new field

The Newfoundland offshore has received a regulatory green light for another step-out field in its Hibernia oil project.

The Canada-Newfoundland and Labrador Offshore Petroleum Board approved development of the Hibernia AA field which holds an estimated 48 million barrels.

The plan involves the drilling of four new wells at a total cost of C$196 million, with oil expected to start flowing sometime next year.

Production from one block is expected to average 11,000 barrels per day and rise to 25,000 bpd when a second block is introduced. The production life is targeted at 2024.

Hibernia Management and Development Co. said there is an upside case pointing to as much as 70 million barrels in the field, which is consistent with previous low-ball Hibernia estimates.

Owners of the AA field are ExxonMobil Canada 33.13 percent, Chevron Canada 27.9 percent, Suncor Energy 20 percent, Canada Hibernia Holding (owned by the Canadian government) 8.5 percent, Murphy Oil 6.5 percent and Statoil Hydro Canada 5 percent.

—Gary Park