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Offshore Oil and Gas Development: the Hibernia Project,
Grand Banks, Newfoundland and Labrador

The Hibernia offshore oilfield was discovered in 1979. It is located about 300 km east southeast of St. John’s, in 80 metres of water on the Grand Banks.

While government and communities generally saw the discovery of commercial volumes of oil as promising, there was also concern and apprehension about a wide range of social and economic issues, including the possible impacts on population change, crime, inflation, traditional industries, and the local culture and way of life.

The operator, Mobil Oil Canada, initiated a multi-year program of biophysical and socioeconomic studies (Table 1, Table 2) and community information and consultation. The various studies and surveys provided information that was used in the project Environmental Impact Statement (EIS). The EIS described predicted socioeconomic and environmental effects, positive and negative, resulting from project construction and operation. It was subject to in-depth public and technical scrutiny under the guidance of an appointed federal/provincial public review panel in 1985. The project was officially approved to proceed by regulators in 1986.

The federal/provincial regulatory agency, the Canada-Newfoundland Offshore Petroleum Board, issued Development Application Guidelines in 1988. These have guided the assessment of all subsequent oil projects and are still in effect. They reflect community concerns about Hibernia and the approach adopted in addressing them. The operator has stated:

“The environmental and socioeconomic assessment and planning process has (now) become the benchmark and standard for industrial development in the Canadian frontier.” (Tsui, et al, 1998)”

While regulatory approval was given in 1986, financial and technical uncertainties delayed project sanction and commencement until 1990. During this time, communication and consultation continued between the operator and two groups - the communities close to the green-field offshore production platform construction site, and the fishing industry.

Some of the communities’ concerns, and the associated analysis and predictions in the EIS, review panel recommendations and C-NOPB development approval conditions, were concerned with the prospective benefits, such as local employment and business opportunities. Others addressed such topics as potential in-migration, increased crime, and the demands on local social services and infrastructure.

The operator, government and communities put in place special mechanisms and initiatives to address these issues during preparations for, and over the six year life of, the platform construction project.

While there was a sense even in the early days that “fish and oil can work side by side,” the fishing industry nonetheless expressed serious concern about disruption to fishing activity on the Grand Banks from oilfield related vessel traffic and sea floor debris. In the more confined fishing grounds of the platform construction area, where traditional small-boat inshore fisheries took place, there was even greater concern about possible loss of access to fishing grounds, interference and damage to gear.

A construction site Project Fisheries Agreement was negotiated that guaranteed no loss of fishing income and provided operational practices for both construction and fishing crews to enhance safety. Inshore fishers also participated in a construction site environmental effects monitoring program.

The Hibernia platform was completed in mid-1997 and began producing crude oil late the same year.

Several assessments of the socioeconomic effects predictions in the EIS have been made. An environmental effects monitoring program, designed with input from regulators and the interested public, continues offshore near the Hibernia platform and a petroleum industry/fishing industry liaison group has been established.

It has been stated that the Hibernia project’s environmental and socioeconomic assessment and planning process is the benchmark - was it and/or is it also integrated management?

Case study author(s)

Leslie Grattan and Mark Shrimpton.