Newfoundland Future Outlooks From Ed Martin – President and CEO of Nalcor Energy

During the NOIA conference in St. John’s, Newfoundland, this summer the range of speakers and talent was exemplary. NOIA was successful in delivering talks from people who pioneered the oil and gas industry and presented their views with enthusiasm for the future of Newfoundland and Labrador – speakers such as the grandfather of the oil and gas industry, Former Lieutenant Governor of Newfoundland and Labrador, The Hounrable John Crosbie, President of ExxonMobil Canada, Andrew Barry and many other industry professionals.

Nalcor Energy is the provincial energy company formed to serve the people of the province by executing on successful plan to develop our energy resources. Nalcor’s oil and gas division holds and manages both onshore and offshore oil and gas interests in Newfoundland and Labrador and works to maximize the benefits of the province’s petroleum reserves and also deliver sustainable energy to it’s people. What follows is a snapshot of some of the messages given by President and CEO Ed Martin, of Nalcor Energy at the NOIA June conference. Ed Martin’s quotes below pertain to the future outlook of the oil and gas industry for the province – good news ahead!

Newfoundland and Labrador is poised for greatness. We have what the world needs. In Newfoundland we have massive oil, gas, hydro, and wind resources. Today, we have tremendous hydro, wind and oil resources—energy resources to generate royalties for our provincial government, to create great jobs for our people, and to supply large resource projects in Labrador with an affordable, reliable supply of long-term power, and to export to energy hungry neighbouring jurisdictions. We are well positioned.

Using conservative assumptions for the amount of exploration wells that will be coming, per year, my prediction is that we will clearly exceed the production levels of the North Sea and we will exceed the amount of time we are in production compared to the North Sea.

Think 30-35 years from now – we are well poised, we are well positioned and we are in tremendously exciting times. There’s no question we can be one of the richest jurisdictions in the world within 30 years from now. Courageous decisions and key investments continue to be required for the true impact to be realized. Investments have to be well planned and well executed and we have to make them now.

Nalcor’s vision is to build a strong economic future for successive generations of Newfoundlanders and Labradorians. This was born out of the mandate we were given nine years ago. I felt then, that to achieve our goal, to generate enough wealth from the crown holding company, to deliver ongoing prosperity for future generations, the organization’s own people had to embrace it and become a part of who we are. To deliver on that we have to do one thing—we do what we say we are going to do. And collectively, we knew we had to begin with the end in mind.

We are located next to the largest market in the world for electricity and oil and gas, plus we have access to Brent oil pricing as our oil is transported by water to worldwide markets—it’s great to be an island.

Geographically, we are two and a half times the size of the North Sea and almost two times the size of the Gulf of Mexico, but we have seen just a fraction of the exploration activity that these other areas have seen. Yet when we do drill, the amount of oil we do find per well, rivals that of the UK Sector and the North Sea.

At Nalcor, we are asking you to think long-term because success in the big-project world is measured over decades. Statoil wasn’t built in a day. The Norwegian State Oil Company was formed in 1972 to take a stake in offshore oil and gas production in the Norwegian sector of the North Sea.

Today, 42 years later, Statoil employs 23,000 people worldwide and holds oil and gas assets in exploration basins around the globe, including the Newfoundland and Labrador offshore sector.

Most importantly, Statoil is the major contributor to Norway’s Oil Fund. The fund, an Alberta Heritage fund on steroids, is now one of the world’s largest investments pools, valued at more than $900 billion Canadian. Norway is now one of the wealthiest countries in the world, with a persons gross income at $62,594 per capita.

Can Newfoundland and Labrador match that success? Yes it can. All indications are that we have a comparable, possibly larger resource potential for offshore oil and gas. In addition, we are 500,000 people and only one-tenth of Norway’s population.