SWN Resources suspends drilling program in New Brunswick: “[T]he commitment to a moratorium has forced us to suspend our drilling plans and rededicate resources to projects in other jurisdictions”

N.B. government considering SWN application for 6-year licence renewal by Laura Brown, March 10, 2015, Global News

New Brunswick Energy Minister Donald Arseneault says he’s not worried that SWN Resources is halting operations in the province. … Arseneault told Global News Tuesday the energy company has applied for a six-year renewal on their exploration licences.

But because SWN has a licence and not a lease, it is only eligible for extensions of one year at a time. However, the government, through cabinet, could grant a longer extension.

When asked if he was worried about what would happen if the province did not renew the company’s licence, Arseneault said he has been looking at all scenarios. “Under the leadership of Premier Gallant, we’ve made the economy our number one priority but we’re also not putting all our eggs in one basket,” he said.

But Jake Stewart, the energy critic for the Opposition, said the province should be worried if they don’t renew the licence. “I think the government will be sued. I think part of what the Minister is doing is he’s going to try and avoid lawsuits. That’s my guess,” he said.

Arseneault reiterated that even if he does extend SWN’s licence, it doesn’t mean the moratorium will be lifted any time soon.

The debate dominated question period Tuesday. Opposition leader Bruce Fitch asked Premier Brian Gallant how much the province is losing by allowing SWN’s business to go elsewhere. Gallant fired back, asking Fitch if he would allow fracking wastewater to be dumped in his riding.

The province is working on an independent group who’ll decide if or when the province has met the five conditions to lift the moratorium.

Arseneault said that group should be announced by the end of March. [Emphasis added]

SWN suspends drilling program in N.B., applies for long-term license by Laura-Brown, March 9, 2015, Global News

SWN Resources has suspended drilling plans scheduled to begin this spring in New Brunswick. In a letter obtained by Global News, SWN’s Executive Vice President of Corporate Development, Jeff Sherrick, said the company has a desire to continue their work and investment in the province, but cannot continue that investment because of a moratorium on hydraulic fracturing. … “[T]he commitment to a moratorium has forced us to suspend our drilling plans and rededicate resources to projects in other jurisdictions,” the letter read. “This is not to say that we do not want to invest in New Brunswick, but we need to be able to assess the long-term effects of the moratorium, once implemented and if lifted.”

The letter [below] was written Dec. 16, two days before Premier Brian Gallant introduced the bill to impose the moratorium. At that time, Gallant said they can continue with exploration — which could include seismic work or wells being drilled, but the wells cannot be fracked. “The understanding that I have is that if there is a moratorium on hydraulic fracturing even some of the operations that you would do in the exploration phase, you may not undertake them because of the cost without ensuring that you would be able to hydraulically frack when the time would come,” Gallant said.

The Dept. of Energy and Mines received four Environment Impact Assessment (EIA) applications from SWN to drill four exploratory wells, two near Rexton and two near Chipman. The EIAs were approved, but the department had not yet issued the licenses. Sherrick also acknowledged the company’s application for a long-term extension of their Licenses to Search. The Dept. of Energy and Mines confirmed they are reviewing SWN’s application to extend its exploration license. SWN has 32 licenses to search in the province, scheduled to expire March 16. They won the bid to explore on March 17, 2010. As a part of that winning bid, the company committed to spending $47 million on exploration projects.

As of November, SWN had completed about two-thirds of their planned exploration work commitment.

SWN Resources Letter – written Dec. 16, two days before Premier Brian Gallant introduced the bill to impose the moratorium:

N.B. Tories say drilling suspension is proof fracking moratorium not working by Kevin Bissett, The Canadian Press, March 10, 2015, The Globe and Mail
A decision by SWN Resources to suspend drilling plans is proof the New Brunswick government is pushing away jobs and investment with its moratorium on shale gas fracking, the Opposition said Tuesday. The Progressive Conservatives distributed to reporters a letter the energy company sent to the provincial government saying it is putting some of its plans on hold. “I want to reiterate our desire to continue work on our exploration program in New Brunswick, but the commitment to a moratorium has forced us to suspend our drilling plans and rededicate resources to projects in other jurisdictions,” wrote Jeff Sherrick, executive vice-president of corporate development for SWN Resources Canada.

“Not knowing if or when the moratorium will be lifted makes it difficult for us to dedicate money to a project that may or may not go ahead in a given year.”

The Tories say they acquired the letter dated Dec. 16, 2014, through a right-to-information request. Energy critic Jake Stewart says he wants the Liberal government to withdraw legislation that would implement the moratorium because it is turning away jobs and potentially millions of dollars in investment.
“They should never have promised that in the first place,” he said. “They played with the future and it’s not right.”

Opposition Leader Bruce Fitch repeatedly asked Premier Brian Gallant in the legislature how many jobs and how much investment may have been lost, but Gallant did not provide any figures in response.

The government’s legislation would require five conditions be met before the moratorium would be lifted. They include a process to consult First Nations, a plan to mitigate the impact on public infrastructure and address waste water disposal and credible information about the effects fracking has on health, water and the environment. Gallant said those conditions are needed to protect the environment and ensure consultation.

SWN Resources did not return a request for comment and no one from the government would take questions about the moratorium from reporters following question period. [Emphasis added]


This entry was posted in Global Frac News. Bookmark the permalink.