Cenovus - Equinor Joint ventureFor those who might not be aware of this joint venture.
Thanks to Loonietunes for this post on the AAV bullboard.
After the dark days of 2020, the first week of 2021 brought a bit of sunlight for the struggling offshore Atlantic Canadian oil industry, whose principal regulator has reconfirmed a "significant discovery" in the Flemish basin. The Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB) has provided the first official resource estimate of the Harpoon discovery made by Norway's Equinor.
Harpoon is located on the Bay du Nord project, a 65-35 joint venture between Equinor and Husky Energy (now part of Cenovus Energy Inc. (CVE: $8.35)) about 500 kilometres off the coast of Newfoundand. Operator Equinor made the discovery through the Harpoon O-85 exploration well way back in 2013. It did not apply for a significant discovery licence until 2020, but kept busy in the meantime by making other discoveries in the basin and reaching a benefits agreement with the Newfoundland government over a potential commercial development. The C-NLOPB officially granted the significant discovery licence for Harpoon in October, 2020. Yet it did not release a resource estimate at the time, so the extent of the discovery was unknown. Now the regulator has pegged the recoverable oil volumes at 40 million barrels.
For context, the overall recoverable oil volumes at Bay du Nord were previously estimated at 407 million barrels. As noted above, Equinor has shown interest in developing the project, proposing a $5-billion development (U.S.) plan back in 2018. In March, 2020, however, the project was suspended because of COVID-19 and low oil prices. Even then, Equinor did not lose hope. In August, 2020, a voluminous environmental impact statement -- over 2,000 pages, plus an additional 1,100 pages of appendixes -- gave the 2018 plan some fleshing out, while suggesting that a final investment decision could arrive as early as 2021. This could allow for further drilling in 2022 and construction in 2023, with the "earliest possible date" for production being 2026, according to the tome. Equinor has not committed to any of these dates. At this point, the project remains speculative, but the resource update from Harpoon is encouraging.
https://stockhouse.com/companies/bullboard?symbol=t.aav&postid=32260950