Offshore Oil Rigs in Canada and Their Impact on the Environment

Offshore oil rigs in Canada are a cause of major debate when it comes to the environment and the economy. Both sides have valid arguments. On the positive side, offshore operators are developing resources safely and responsibly. They state that they are benefiting Atlantic Canadians and are not just about meeting the energy needs of the society. They generate employment, boost local businesses, drive crucial research, and develop and promote education and training. All this is done whilst ensuring they generate and maintain a sustainable infrastructure.

This industry has a major impact on Atlantic Canada's economy. Oil and natural gas companies in the region contribute significantly to the communities where they are active as well as royalties and taxes the industry pays to the government. The industry is committed to developing resources responsibly and doing everything it can to mitigate potential impacts on the environment. The industry is governed by strict regulations and all companies have to meet the environmental protection regulations whilst adhering to global best practices as well.

Canada's Offshore Oil Production

Canada is one of the world's largest producers of petroleum and the largest supplier of crude oil imports to the United States. Drilling in the Arctic is very expensive and very difficult. East coast reserves are almost 350 miles offshore and in very deep water. Drilling off the West Coast is prohibited because of the federal government's ban on oil and gas exploration off the coast of British Columbia after an oil spill near Santa Barbara, California in 1969.

A major concern surrounding Newfoundland and Labrador's offshore oil industry is the harmful effect it may have on the ocean environment. Most of the oil deposits are on the Grand Banks and scientists and environmental groups, as well as members of the public, are fearful that drilling, exploration, and shipping will interfere with the health of the marine ecosystem if the industry isn't properly regulated.

Oil production happens in three stages:

  • Exploration - seismic surveys are used to locate potential oil deposits. Underwater airguns are used which can cause damage to fish.
  • Production - Drilling through the seabed produces rock cutting that mix with the oil and drilling chemicals. Drill cuttings are dumped into the ocean. Oil and chemicals can smother and interfere with marine life.
  • Shipping - shuttle tankers ship the crude oil to land where it is then taken to be refined.

Each stage has potential risks to the environment but oil spills are a major environmental concern and can happen at any stage of the production and for any number of reasons including equipment failure, human error, tank ruptures, and tanker accidents.

Newfoundland and Labrador Oil Spills

Newfoundland and Labrador's offshore industry experienced its largest oil spill back in 2004 when mechanical failures caused 1,000 barrels of crude oil (165,000 litres) to flow into the ocean from Petro Canada's Terra Nova FPSO.

Similar spills have occurred at three of the province's active oilfields over the years. Husky Energy reported 30 barrels of crude oil spilt into the ocean from White Rose FPSO in 2008, and 300 litres of crude oil spilt from the Hibernia platform in 2006.

Oil spills can be very damaging to all wildlife including seabirds. Scientists estimate that on average 300,000 seabirds die every year from oil pollution off the coast of Newfoundland and Labrador.

Oil Platform Environmental Damage

Oil platforms also harm the environment. They can be home for a large number of birds and the world's largest colony of Leach's Storm Petrels breed on the northeast Avalon Peninsula near the Hibernia platform.

Oil platforms also emit greenhouse gases which contribute to global warming. Platforms also discharge human waste into the ocean. Newfoundland and Labrador's offshore oil developments contribute to the economy but they can also cause damage to the environment so it is important the that government and the industry officials do all they can to prevent this whilst sustaining the economy.

Active Projects on the East Coast Of Canada

There are a number of active oil projects off the coast of eastern Canada and these are listed below.

  • Newfoundland and Labrador: There are three oil projects offshore. These are Hibernia which is operated by Hibernia Management and Development Company Ltd, Terra Nova operated by Suncor Energy, and White Rose operated by Husky Energy.
  • Nova Scotia: There are two natural gas projects located offshore Nova Scotia. These are the Sable Offshore Energy Project operated by ExxonMobil and located on the Scotian Shelf about 200 kilometres off the coast, and Deep Panuke operated by Encana Corporation located about 250 kilometres southeast of Halifax on the Scotian shelf.

SeaRose FPSO Operation Suspended

The SeaRose FPSO is located off Newfoundland and Labrador. Operations and associated production facilities have been suspended after an incident on March 29, 2017. An iceberg entered the 0.25 nautical mile Ice Exclusion Area of the SeaRose FPSO which operates at the White Rose filed about 350 km east of St. John's. There was about 340,000 bbl of crude oil onboard. The iceberg did not make contact and there was no damage. Further investigations were carried out and it was found that there are serious issues respecting Husky's ice management, management systems, and organizational decision-making. The current production from the SeaRose FPSO is about 27,000 b/d of oil.