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Exxon rules the roost: Taking over offshore Hebron project
Whether Newfoundland Premier Danny Williams likes it or not, ExxonMobil — the company that once sent him into a raging fury over the breakdown of negotiations on fiscal terms for the offshore Hebron project — has taken an even tighter grip on his province’s petroleum riches.
It will soon take over the operator’s role at Hebron from Chevron Canada Resources, extending its lead position in the Hibernia field.
Although no date has been set for the handover, a Chevron spokesman said in a statement it will be “in as timely a manner as possible,” indicating it will occur in weeks rather than months.
Synergies with Hibernia He said that because ExxonMobil runs the show at Hibernia “there are synergies that can be captured by having it also operate Hebron.”
“All partners have been notified and are in agreement that this needs to happen as expeditiously as possible.”
ExxonMobil already has the largest stake in Hebron at 36.04 percent, with Chevron at 26.63 percent, Petro-Canada 22.73 percent and StatoilHydro at 9.7 percent. The Newfoundland government will take a 4.9 percent interest under its newly negotiated agreement.
Hebron, discovered in 1981, has up to 700 million barrels of recoverable crude and could, based on industry estimates, cost about C$7 billion to develop and bring on stream in 2016-2018 at 150,000 barrels per day, although the Williams government puts the estimate in the range of C$4 billion-C$6 billion. ExxonMobil is not ready to provide an updated estimate.
—Gary Park
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