A second province reopens the door to offshore oil and gas

After a period of dormancy in oil and gas activity off the coast of Nova Scotia, a company has been given the first approval needed to explore for fossil fuels off the province’s coast.

On Wednesday, the Canada-Nova Scotia Offshore Petroleum Board (C-NSOPB), which regulates oil and gas activity, announced the results of its call for bids. One company, Inceptio Limited, put forward $1.5 million and won a bid to explore a parcel of water on the Scotian Shelf approximately 119,803 hectares in size, an area which could fit on the Halifax Peninsula about 63 times. The area neighbours Sable Island, which is 290 kilometres southeast of Halifax.

There are currently no active exploration licences in the province or active projects, confirmed C-NSOPB, which noted this proposed project must still move through another application before drilling wells or doing seismic testing. The province had five offshore fields, which operated from 1999 to 2018 and produced 2.1 trillion cubic feet of natural gas during that time.

In a written statement, the board noted the project will still need to go through an environmental assessment. A press release said if approvals are given, the board will give the exploration licence to Inceptio Limited in January.

Environmental groups say the province has a chance to ditch the industry for good and focus on offshore renewables instead, and are calling for all levels of government to reject any oil and gas exploration or expansion.

The groups, which include the Council of Canadians and Sierra Club Canada, celebrated in 2022 when they noted, “BP and Equinor abandoned the last remaining oil leases offshore Nova Scotia.” Currently, the only project in Nova Scotia waters — the Sable Offshore Energy Project — is being decommissioned and is in the monitoring phase.

In a written statement to Canada’s National Observer, Inceptio Limited’s president James Edens said while renewables do need to be expanded, that doesn’t mean they can’t exist in tandem with new oil and gas.

“... We believe synergies exist for organizations to work together in the energy space, to meet energy demands of today and tomorrow, while reducing our carbon intensity,” said Edens, who noted the area the company plans to explore “uniquely offers a known discovery of gas and also a number of undrilled prospects.”

Continuing to allow offshore oil exploration and extraction goes against mounting evidence that the world needs to slow down fossil fuel production and halt new project approvals to have a chance of staying within 1.5 C of global warming, said Gretchen Fitzgerald, national programs director of the Sierra Club Canada Foundation. In September, the International Energy Agency (IEA) reaffirmed there isn’t room for new oil and gas projects in a climate-safe future, and that a ramp-up of clean energy is needed to replace carbon-emitting energy sources.

Instead of restarting offshore oil and gas, Fitzgerald says the board should focus on offshore wind, as recommended by the IEA. Last year, the board announced it is undergoing a name change to become the Canada-Nova Scotia Offshore Energy Board. Announced by the federal and provincial governments, the bodies said the move will “facilitate the transition to a clean economy and create sustainable jobs” and shift away from its previous mandate of “enabling safe and responsible development of Canada-Nova Scotia’s offshore petroleum resources.”

However, there is precedent for offshore development backed by the federal government right next door. In 2022, over $238 million worth of exploration licences were awarded in Newfoundland by the provincial-federal regulator. Also in 2022, Environment and Climate Change Minister Steven Guilbeault approved Bay du Nord, stating it was environmentally sound. He determined the project, about 500 kilometres east of St. John’s in Newfoundland, “is not likely to cause significant adverse environmental effects.”

Edens said “developments at Bay du Nord have not influenced” Inceptio Limited in its exploration plans.

The call for bids received just two responses for eight available parcels, which shows the lack of interest in Nova Scotia’s offshore, said Fitzgerald. The board said a bid was put forward for another parcel, but that the company didn’t meet their requirements.

The Sierra Club is part of the Offshore Alliance, which is a collection of over 20 groups calling for a moratorium on offshore oil and gas development.

“Going through this call for bids process and expending government funds and resources to encourage and evaluate new oil and gas exploration in a time when more and more people need community support to afford the basics of life and to keep their communities safe from climate damage is both reprehensible and dangerous,” added Angela Giles, Atlantic regional organizer with the Council of Canadians, which is also part of the alliance.

“It's time for all levels of government to address the crises with clear and decisive action.”