Feds’ impending Bay du Nord decision one to watch

OTTAWA—Bay du Nord? If you don’t know what Bay du Nord is now, you will almost certainly know by next week when the federal government is supposed to give this offshore oil project a thumbs up or a thumbs down. Rejection or approval will come with a lot of noise. It will be the first major decision on a future resource development project since the new federal emissions plan was announced, and since the Trudeau government said Canada needs to up oil-and-natural gas production to help lessen Europe’s resource dependency on Russia. Some quick background on the proposed project, which has already gone through extensive environmental review and previous government-approval delays. According to the Government of Newfoundland and Labrador’s information sheet on Bay du Nord, it's the first remote, deep-water project in the province’s offshore. It is 500 kilometres from shore and 1,200 metres deep. It has reserves of nearly 300-million barrels. It could hit production within five years. The project is being championed by Norwegian oil giant Equinor. The project is supported by the six Liberal and one Conservative Members of Parliament from Newfoundland and Labrador. The provincial government and its official opposition support it. The Newfoundland and Labrador NDP do not, as with a number of environmental groups. Public support appears to be strong for it, though there is no fresh data to provide a more precise metric. It is suggested that the project, if fully maximized, would create 22.3 million person hours or 11,000 person years of in-province employment for Newfoundlanders and Labradorians over the life of the project, and bring an estimated $3.5-billion in revenues to the government. In February, Radio-Canada reported there was tension and disunity at the Trudeau cabinet table over whether to approve the project. Unnamed minsters in Quebec, Ontario, and British Columbia were reported to be against it, while key people like Deputy Prime Minister and Finance Minister Chrystia Freeland were said to be in favour. Many in Newfoundland and Labrador went apoplectic after this report, given Bay du Nord has emerged as the current symbol of whether the province will sink or swim. Days after the report, the federal government announced it was taking another 40 days to further review the project. That 40-day period is up on April 13. After the delay was announced, senior federal cabinet minister for N.L., Seamus O’Regan appealed for calm and asked that Environment Minister Steven Guilbeault be given some time to reflect. Unlike in previous eras, when Newfoundlanders and Labradorians would be encouraged to storm Ottawa or take down flags to make their point, the public has generally availed of O’Regan’s call—for now. A "no" will change that dynamic, and could have significant political consequences for the province’s Liberal MPs next election, thus why Conservative leadership candidates have been falling all over themselves saying that a “yes” to Bay du Nord is a must. Another political curve ball was thrown Bay du Nord’s way during the 40-day delay. The Liberal-NDP supply-and-confidence agreement was born. While that agreement was silent on offshore oil, it spoke loudly about ending federal investment in the fossil fuels industry. Bluntly, Newfoundland and Labrador wouldn't have the offshore industry it does without early federal cash injections and an ownership stake in Hibernia. Though NDP Leader Jagmeet Singh has roots on the Rock, the party hasn't championed the industry since Jack Harris was the MP for St. John’s East, N.L. So, as we are allegedly less than a week or so from knowing the future of Bay du Nord, current idle speculation suggests it is closer to being approved than rejected. And while Newfoundlanders and Labradorians may rejoice if the project gets a thumbs up, environmental activists and environmental-value voters will be gravely disappointed. How they might respond, and the potential for this to weaken Liberal electoral prospects elsewhere, will be something to watch. The Bay du Nord decision is a big one. Tim Powers is vice-chairman of Summa Strategies and managing director of Abacus Data. He is a former adviser to Conservative political leaders. The Hill Times