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Yvonne Jones, Opposition Natural Resources Critic and MHA for the District of Cartwright-L=Anse au Clair, is concerned that the premier=s confrontational approach in dealing with the offshore oil and gas industry is negatively impacting exploration investment for future growth. Jones referenced the poor level of interest expressed in this year=s Call for Bids.

Since this government came to power, interest in offshore exploration has continuously declined. In 2003, bids totaled over $672 million; in 2004, bids dropped to $71 million; in 2005, they dropped to $39 million; in 2006, they dropped to $32 million. This year, industry has not expressed any interest in bidding land parcels in the highly prospective Jeanne D=Arc or Orphan Basins, the area where Hibernia, Terra Nova and White Rose are located.

AExploration is key to making new finds and growing our oil and gas industry,@ said Ms. Jones. AThis year=s lack of interest certainly casts a larger shadow over the future growth of this sector. There has not been a new discovery made in our offshore in over 20 years, and with this government=s confrontational approach, I fear another discovery will not be made anytime soon. I question what impact the decision to shelve Hebron/Ben Nevis may have had on the oil industry=s decision not to invest in Newfoundland and Labrador this year?

AIn addition, industry is still waiting for this government=s much promised energy plan and natural gas royalty regime and are unwilling to invest until these details are released. Government is sitting on these documents for political considerations so they can make this part of their election platform. As a result, government has basically sacrificed a full year of investment to satisfy their own political agenda.

AI am also very concerned with the departure of the drill rig Erik Roude, and the imminent departure of the drill rig Henry Goodrich. Both rigs are leaving for other parts of the world because of declining exploration work in this province. I questioned the Minister of Natural Resources as to the impact this will have on employment levels and service and supply contracts for our province, however, the minister was unwilling to acknowledge this important issue.@

Jones also noted that from a Labrador perspective, people are uncertain as to what this year=s Call for Bids means for them. AOffshore Labrador is primarily composed of natural gas deposits, and of the five land parcels being auctioned off this year, four are located offshore Labrador. Unfortunately, nobody in Labrador knows when the natural gas royalty regime will be released publicly to determine what benefits will accrue to the people of Labrador. This issue needs to be addressed immediately and the people of Labrador must have input into any final benefits structure.

AI am very concerned with the lack of momentum currently taking place in our offshore oil and gas sector. Government is certainly reaping the benefits from Liberal projects such as Hibernia, Terra Nova and White Rose and have a record surplus budget this year. However, unless new discoveries are made and developed, this level of spending will not be maintained. Without increased investment in our offshore, the future of this very important sector of our economy is certainly questionable.@