Nova Scotia companies vying for contracts as Sable gas field nears end of life
Halifax – The delicate task of dismantling the Sable Offshore Energy Project is set to begin next year, and local suppliers are lining up for a piece of the lucrative work.
More than 100 companies attended a suppliers forum in a downtown Halifax ballroom Wednesday to learn about the retirement of the natural gas field off the coast of Nova Scotia, which started producing in late 1999 and would pay nearly $2 billion in royalties to the province.
Decommissioning manager Friedrich Krispin told the business crowd it’s essential for the offshore facility to “finish strong.”
“Our activities have been conducted in what is deemed to be an environmentally responsible manner,” he said. “We will leave behind a strong record … but this is only the case if we finish strong.”
The Sable project, a consortium of five companies majority-owned by ExxonMobil Canada, is made up of seven offshore platforms, 22 wells and 340 kilometres of subsea pipeline.
Krispin said the pipelines will be flushed to remove hydrocarbons, filled with water and capped.
He said leaving the pipeline on the ocean floor is “current industry practice.”
“This method has demonstrated it will cause less environmental damage and disruption to established sea life,” Krispin said. “However, there might be cases where portions of these pipelines could present a hazard and will have to be either mitigated or removed.”
Mark Butler, policy director of the Halifax-based Ecology Action Centre, said oil and gas giants should clean up after themselves.
“It’s the basic principle that if you’re going to extract oil and gas, you need to … leave it as pristine as possible,” he said.
Michel Samson, Nova Scotia’s energy minister, referred questions about the shut down and cleanup to the Canada-Nova Scotia Offshore Petroleum Board, saying it was up to the independent regulator to decide what to do about the pipelines.
Board spokeswoman Stacy O’Rourke said leaving the pipeline in place was approved before the project started.
The Sable facility includes five natural gas fields spread over 200 square kilometres in the North Atlantic Ocean near Sable Island, which is now a national park reserve. The small, crescent-shaped island about 300 kilometres southeast of Halifax is known for its rugged landscape and pony-sized wild horses.
Four companies have already been awarded major contracts for the decommissioning work: Halliburton Group Canada, Noble Drilling Services, ABM Offshore and Heerema Marine Contractors.
In matchmaking sessions held by the Maritimes Energy Association behind closed doors, companies had 10-minute, one-on-one meetings with the major contractors.
Calls for bids on a wide range of work are expected in the coming months.
Work to shut down the facility is slated to start early next year and run for two years before all 22 wells are plugged and abandoned.
Energy Department spokeswoman Barbara MacLean said the companies that own the project will pay the decommissioning costs.
“These costs are factored into the calculation of how much royalties these companies owe the province,” she said in an email. “Decommissioning costs are confidential, and not something we are able to share.”