NL’s Controversial Bay Du Nord Project

bay du nord illustration fpso
bay du nord illustration fpso
Advertisement

Job creation, environmental impacts, and student response.

The Federal Government of Canada approved the controversial offshore oil project on April 6th – Equinor’s Bay Du Nord project.

This occurred after Federal environment minister Steven Guilbeault approved it after reviewing the project’s impact assessment and determining that it would not cause significant environmental effects.

However, many activists still argue against this decision highlighting the recent IPCC Assessment Report that emphasizes the following regarding climate change:

  • The world is facing unavoidable climate hazards over the next two decades, with global warming of 1.5 degrees Celsius – significantly increasing the risk to society.
  • Urgent action is required to deal with the increasing risks, including increased heatwaves, droughts, floods and mass mortalities of animal and plant species.
  • The window for action against climate change is narrowing.
  • Greenhouse gas emissions need to decline rapidly to achieve climate-resilient development prospects.

IPCC asserts that we have options in all sectors, including energy, to halve emissions by 2030. Still, it will require major transitions in the energy sector, including “substantial reduction in fossil fuel use, widespread electrification, improved energy efficiency and use of alternative fuels.” Furthermore, limiting warming to 1.5 degrees Celsius will require greenhouse gas emissions to peak before 2025 at the LATEST, emphasizing the urgency to reduce fossil fuel usage immediately.

Advertisement

The project remains controversial because it is supposed to begin pumping oil as early as 2028, three years after the IPCC recommends greenhouse emissions should peak.

In an interview with Michael Connors, Federal Minister of Labour, Seamus O’Regan argued that the Bay Du Nord project is essential for the government’s emission reduction plan.

He highlighted that Bay Du Nord is a “lower-emitting source of oil” that will generate thousands of jobs and revenue and keep energy affordable.

This was in response to environmentalists who highlighted the significance of downstream emissions. These emissions are emitted after the oil leaves the company’s control.

Minister O’Regan stated that we could not take an “obstructionist” approach to reduce emissions but rather must be practical. Furthermore, he emphasizes that energy must be affordable, making large energy projects necessary. Equnior is committed to reaching net zero.

In an interview with The Current, scholar and author Angela Carter emphasized that we are in an urgent situation. 

The government wants to add more oil, which is not part of a green transition because it will lead us in the opposite direction. She highlighted that “we have heard this before, that jobs are promised but never become a reality.”

She also stresses that oil was supposed to bring us property in its origins. Instead, it has generated very precarious employment and few jobs, as the oil sector jobs only represent 1.4% of total employment.

Furthermore, tradespeople want a just transition and an end to the empty promises and precarity of oil. Finally, the notion that Bay Du Nord offers “responsible low carbon oil” is false because even if it is lower-emitting, it will still generate emissions that there is no room for, given the state of the changing climate.

Responses from Engineering Students

Engineering and the petroleum sector are a significant part of Memorial University.

Memorial has recently placed 51 out of 100 in the QS World University Ranking in 2022 for Engineering and Technology: petroleum engineering and tied for third place in Canada.

The Bay Du Nord project is significant to Memorial University. It could provide several job opportunities to Memorial University students. However, the environmental impacts are well-known amongst MUN students. This is evident with the number of Climate strikes that have taken place on campus with Fridays For Future, NL: where students and activists demanded divestment from carbon and a transition to sustainability.

Climate strike
(Photo from VOCM https://vocm.com/2019/09/24/mun-throws-support-behind-global-climate-strike-as-world-watches-un-emergency-summit/0)

I interviewed three engineering students at Memorial University to find out how engineering students are responding to the approval of the Bay Du Nord project.

Note: The respondents will remain anonymous to avoid retaliation from the Engineering faculty.

Abby: What do you know about the Bay Du Nord offshore oil project?

Respondent 1: I have a pretty good understanding of the Bay du Nord project. I have gotten exposure to that industry during my work terms and from family members in the industry. The Bay du Nord project will be a new floating, production, storage and offloading (FPSO) facility offshore Newfoundland that will be connected to groups of wells (called drill centres) using subsea umbilicals. Similar projects exist offshore already with the SeaRose and Terra Nova FPSOs. However, Bay du Nord provides a unique challenge as it will be a deepwater project, with water depths of over 1km below the waves. 

Respondent 2: I learned about this project from my class group chat when we were talking about work terms and how they will soon be hiring in the future. This prompted me to look it up on the internet and learn about this offshore project located 500 km from our island; that’s so close!

Respondent 3: I’ve done a fair bit of research on this project. I know it’s an upcoming, recently federally approved offshore oil project that plans to extract up to one billion barrels of crude oil from the seabed about 500km northeast of St. John’s. It was recently approved by the Federal Environment Minister but has been met with backlash and controversy as scientists, environmentalists, and Indigenous activists alike have concerns about the potential environmental impacts of this project.

Abby: Do you support the project, or do you think the government should reconsider? Why?

Respondent 1: I have thought very long and hard about this question. I do support this project; however, I believe that Newfoundlanders and Labradorians need to look at it with a more balanced approach. In my opinion, the Bay du Nord project is a huge grey area. One cannot ignore the financial implications of rejecting it, nor can one ignore the environmental impact that it will cause. I support this project on several different grounds:

1. we have a good pool of resources already in existence in the province. There is excellent technical knowledge present in Newfoundland from our 20+ years of experience with the offshore – building another project is an easy lay-up in terms of risk to the public. It’s highly unlikely that Bay du Nord will lead to a financial catastrophe as Muskrat Falls did. 

2. this province does not (yet) have a viable substitution industry to replace the offshore industry. Changing the basis of a provincial economy is a very big ship to turn. I feel we have made immense progress in growing other industries to diversify (see the tech, mining, and tourism industries). However, they are not quite where they need to be for a Bay du Nord rejection to make sense. I don’t see a need for us to cut off our noses to spite our face by rejecting billions of dollars of potential revenues. We can balance the environmental risk through the strict regulatory oversight that the C-NLOEB provides.

Respondent 2: I am neutral on this. Personally, I did not support the oil and gas industry here. However, my view has changed over time as the energy sector is still expanding. The projects are very interesting to work on, especially. Knowing the economy of NL, which gets a big boost from the oil, I don’t see the government not being fully in support of this decision to reconsider. However, proper regulations and imposing fines for exceeding a certain amount of emissions would be favourable. That would be one way I can support this project. I think Newfoundland needs to be less dependency on the oil sector in the future, as this sector is volatile. I lost a co-op to an oil company in 2020, when the pandemic hit, as the oil demand decreased drastically. We need more alternative local projects, which can possibly direct the dependency away from big oil projects.

Respondent 3: I am completely opposed to this project. The government should absolutely reconsider for a multitude of reasons, including environmental preservation, impact on Indigenous communities, and our province’s economic stability as oil & gas become less and less feasible as a means of creating energy. It frustrates me, especially because Indigenous groups and leaders have spoken out against this project and the federal and provincial governments despite presenting as committed to reconciliation.

Abby: Do you think the project will generate jobs for Memorial students? How?

Respondent 1: Historically, the offshore oil and gas industry has been a large employer of students in this province – I myself am on a work term with one of the offshore operators now. This is good – oil and gas work terms can provide multi-disciplinary exposure to all different types of engineering. I feel that Bay du Nord will provide us engineering students with good hands-on engineering experience. However, I’m wary of students doing ALL of their work terms in industry-specific roles. In my role in my work term, I am in a project management division, learning skills that can be applied to any industry. However, a student that does a work term in drilling operations may not be able to transfer those skills when the oil industry tapers off.

Respondent 2: Absolutely. Oil companies hire a lot of students because the work we as students contribute is so valuable to companies. Students will get hired on each team because a project like this will have many teams come together and work to execute.

Respondent 3: I think this project will generate jobs for engineering students, as we know that engineers are needed in oil & gas operations – many of the work terms available to us are oil and gas-based or related to the industry in some way. However, as the Environment Minister himself has stated, the project won’t start producing oil until 2028, long after any current Memorial engineering student is on track to graduate. While there may be jobs for engineers on work term placements, I worry about the long-term feasibility of this project as more and more industries move away from oil & gas as an energy source.

Abby: Do you think the project will boost the economy and benefit memorial students? How?

Respondent 1: The economic benefits of this project are numerous. I think it will be a well-needed boost to the provincial treasury and people’s pockets. A population that can sustain itself through good-paying jobs is more confident. I think this province needs a confidence boost more than anything. More money in the economy doesn’t just benefit engineering students or business students. It means that people will have more spending money to go buy things they like, like a night out for dinner, or maybe some artwork, or a show, or saving up for a home – money talks!

Respondent 2: From my experience, it will definitely boost the co-op scene at Memorial, as companies hire business and engineering students (both of which have a co-op program at MUN). I think there need to be more jobs here in NL to help younger people stay. I personally moved out of the province for my last few work terms, and if I continued working there, I would have to leave NL permanently, a place which I call home.

Respondent 3: The project may indeed boost the economy in the short term, but what seems to be the biggest economic concern is that oil & gas is a clearly dying industry, and while it will technically be needed in the coming decades as we de-transition from fossil fuels, it is worrisome that the provincial government is seemingly not prioritizing growing industries, such as renewable energy and tech, in order to attempt to reap more immediate benefits in natural resource extraction. If we don’t invest in growing industries, we will be left behind economically by the rest of the world.

Abby: Climate activists and environmentalists disagree with the project because of increasing Green House Gas emissions and climate change? What do you think about this?

Respondent 1: The environmental impacts of this project cannot and should not be ignored. There is a tendency amongst politicians and industry pundits to tout that it’s “low carbon oil.” This is only true in what’s known as the upstream (i.e. how the oil is extracted and shipped for export). Emissions are the same due to Downstream, or what happens to the oil when it reaches the market. Gasoline refined from NL oil will produce the same carbon dioxide as gasoline refined from dirtier Saudi or Albertan oil. It’s not an acceptable cop-out, and we have to be honest with ourselves and admit that this project will, without a doubt, contribute to rising greenhouse gas emissions globally. However, considering all factors, it’s a risk and a consequence I believe we must accept – our oil can be used to displace oil from Russia, Saudi Arabia, and even American or Albertan oil. So long as these other places increase and continue to produce, I see no reason for us to back out now. We can simply lead the way and show them how a just transition can be done. A just transition does not mean shutting down Bay du Nord and other projects in the next 5 years. I note a concerning trend in those vehemently opposed to Bay du Nord – they have no skin in the game. They themselves will not be impacted by this decision either way. I’d urge everyone to *really* have a long think about this – to me, it’s about balancing economic consequences with environmental, and at this stage in the game, I believe we must focus on economics. 

Respondent 2: And I totally understand their viewpoint. This project would mean that natural resources will get used up and emit greenhouse gases as a result. The oil and gas sector is the largest source of greenhouse gas emissions in Canada, bordering about 30% of total emissions (a very big number!). I think they are right, as it contributes massively to climate change! Without alternative industries creating jobs/projects in Newfoundland, it will be very hard to keep younger people in the province.

Respondent 3: It makes sense that climate activists and environmentalists disagree with this project because it has been poorly planned out, according to scientists. Scientists have expressed concern that oil & gas lobbyists have been interfering with scientific advice and practices to get the project approved and refusing to address genuine scientific concerns about environmental impact. Indigenous groups have expressed concern that they were not consulted early enough in the review process. I worry that by making reckless decisions for short-term gain, the government is making it more and more likely that our province will have to deal with greater economic difficulties in the coming decades. This project is clearly a dangerous one for the government to have approved. I urge them to reconsider it for the well-being of students and all young people in Newfoundland & Labrador.

Student response to the project is mixed, as the jobs and revenue that could be generated by the project are largely needed right now. However, students understand the devastating environmental consequences and the downward trend of the oil and gas industry. Students want the government to re-think these concerns, as students are focused on their career and their futures.

Recently, the provincial government has removed its moratorium on onshore wind energy production that has been in place since 2007. Several companies in the province have shown interest in developing wind farms, increasing interest in clean energy projects. Renewable energy projects could be considered an alternative route for job creation in the province, as research in the US indicates that non-fossil fuel technologies create more jobs than coal or natural gas. The wind industry generates jobs in many skilled and professional sectors, including engineers.

Therefore, the government must consider research on the environmental impacts of continued fossil fuel extraction and the economic benefits of clean energy projects. And the government must consider the interests of Memorial students who wish to have long-lasting careers in the province and have a clean environment for generations to come.

Advertisement
Abby Cole
Abby Cole is a 4th year Political Science student at Memorial University. Abby is interested in global politics and social issues, and is aspiring to be a journalist after her studies. She also is the host of the radio show "The Indie Hour" on 93.5 CHMR-FM, MUN's campus radio station.