Government Has Already Met With Suncor

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Monday, August 7, 2017

August 7, 2017


For Immediate Release


Government Has Already Met With Suncor Officials Who Want Terra Nova Field Royalties Cut




‎Keith Hutchings, Natural Resources Critic for the Official Opposition, said, "A recent report from Suncor states the Ball government has already met with registered lobbyists of Suncor Energy who are pushing to lower royalty payments to our province on an already developed and sanctioned oil field. The people of the province get to hear this first from one of the oil partners?"




"The company has told the press that they met in July with officials of the government, Nalcor Energy and the Offshore Petroleum Board," he said.




"They are talking in terms of extending the life of the Terra Nova project, but their message is clearly that they want a royalty regime that is more favourable to the company and that usually means less favourable to Newfoundlanders and Labradorians, whose oil resources they are extracting.”




"Fair royalty agreements negotiated and agreed upon at the start of a sanctioned project are to be ‎honoured throughout the project, extensions included. That's what an agreement means," he said. “You may remember the recent Hebron project when the Liberal Government ‎was asked if the royalty regime would be changed for the extension of this project and their response was that the royalty regime for the project was already set, so there would be no changes. Based on that assessment, why would we even consider reopening a regime under which Suncor wants to talk?”




"The Ball government has opened the door to lobbyists reaping benefits from their inaction and their lack of clear direction to the oil companies. They have failed for two years to announce a new generic royalty regime – a regime that our administration had already developed and announced prior to the 2015 election, but the Liberals never adopted. The Minister of Natural Resources even stated in the House of Assembly that it would be announced by March 31, 2017. The Liberals said they would move swiftly to enforce the royalty regime to bring certainty to the industry. Instead, by doing nothing, they have sent a clear message to the industry that they are open to bargaining, a message not in best interest of our people. The oil companies no doubt sense that weakness and uncertainty, and are now trying to out-maneuvre the government to garner a greater share of our resource wealth at public expense," he said.




‎"The Ball Liberals were out-maneuvred on the Hebron project, and allowed Husky to not honour a prior commitment of well over $100 million to building gates for the dock in Argentia that would have allowed generations of work for further projects, rig maintenance and other work to support our skilled workforce; but the Ball Liberals just let it go. A hailed $60 million investment in innovation, on further review, gets to be clawed back for oil partners through inclusion in project capital costs, so the government negotiated a loan, not more benefits for Newfoundland and Labrador," he said.




"We announced an Energy Plan in 2007. We have no idea, as we have asked, if the current government is following this, if they have an update not shared with the province, or if their energy policy is being made up minute to minute. Without an energy plan, the Ball Liberals are running our oil sector the same ad-hoc way they're running our province: recklessly, ineffectively, with no plan. Not having a clear direction, a defined royalty regime or an updated energy plan, they are being taken advantage of‎, and that's costing our province revenue, jobs and other benefits that we are entitled to under the Atlantic Accord," he said.



"We need immediate comment from the Premier and the Minister of Natural Resources on this revelation related to Suncor; why we gave so much up on the Hebron project; where the new royalty regime is; and what energy policy they are following for the province. They need to have an updated read of the Atlantic Accord and its intent for our province and our people," he said.




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Media Contact: Heather MacLean, Director of Operations and Communications,


Office of the Official Opposition, (709) 729 6105,


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