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April 2004

Vol. 9, No. 15 Week of April 11, 2004

Marine parks touted for British Columbia offshore

Environment minister working on plan covering 6.8 million acres; three other protected areas under consideration; could scuttle exploration hopes

Gary Park

Petroleum News Calgary Correspondent

Dreams of turning the British Columbia offshore into an oil and natural gas producing region could be in danger of getting snuffed out.

The Canadian government is reportedly on the verge of turning four large areas of the Queen Charlotte basin — by far the richest of British Columbia’s petroleum basins — into marine parks.

Federal Environment Minister David Anderson, who also represents a British Columbia constituency in Parliament, said he hopes to present a plan to the cabinet by this fall to create a marine wildlife area covering 6.8 million acres from the northern tip of Vancouver Island to the Queen Charlotte Islands.

The government is reported to be examining the possibility of establishing three other protected areas, stretching northward from Vancouver Island over several hundred miles along the coastline.

Plan would sharply reduce offshore available for exploration

Patrick O’Rourke, assistant deputy minister for the British Columbia Energy and Mines Ministry, said that if the federal government goes ahead with the plans, the amount of offshore available for exploration would be sharply reduced.

He told a conference in Vancouver that the proposal “adds to the challenges” faced by the provincial government, which has targeted a commercial industry by 2010.

Andy Burton, a Conservative Member of Parliament for northern British Columbia, said the talk of marine parks is “very frustrating” and could be a “back-door maneuver to block off any offshore oil and gas activity.”

Under the federal Wildlife Act, Anderson could create a park without any support from the affected communities, although Tomas Tomascik, a senior advisor with Parks Canada, told the Vancouver conference he did not think that would happen.

Anderson is an avowed opponent of opening up the offshore to oil and gas drilling, having taken a role in developing the moratorium in 1972.

Federal panel reviewing ban on exploration

Currently, a federal panel is reviewing that ban on exploration of a region Natural Resources Canada has estimated holds 43.4 trillion cubic feet of gas and 9.8 billion barrels of oil, of which the Queen Charlotte basin is estimated to contain 25.9 tcf of gas and all of the oil.

The panel started public hearings April 5 and will visit 11 locations by May 15 before reporting to Natural Resources Minister John Efford this summer.

Officials expect a decision some time in 2005 on the moratorium.

Meanwhile, the U.S. government through the U.S. National Science Foundation is contributing C$3 million along with a research vessel to conduct a seismic study off the Queen Charlotte coast.

The study is scheduled for late 2005, regardless of whether or not the ban is lifted, said O’Rourke.

He told the Financial Post that the province thinks the seismic needs to be done because previous data was based on old and flawed techniques and is not affected by the moratorium.

Federal studies in the 1990s suggest the offshore has far more oil and gas than previously thought.

But a mountain of problems must be resolved before any of the leaseholders — notably Shell Canada, Chevron Canada Resources and Petro-Canada — are interested in developing exploration plans.

A regulatory regime, including how royalties will be shared by the B.C. and Canadian governments; aboriginal land claims; seabed ownership; and environmental issues are all on the agenda, prompting most experts to forecast that, if commercial discoveries are made, production is at least 10 to 12 years away.






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