IN THE NEWS / Regulator Imposes Cap On Hibernia Production Cut 30%
Until Gas Burning Stops
Wednesday, December 23, 1998
Bloomberg News
The Hibernia oil project off the Newfoundland coast has been ordered by its regulator to cut production 30 per cent until it stops burning off surplus natural gas.
Starting next month, production from the Hibernia field 320 kilometres southwest of St. John's will be limited to 68,000 barrels of oil a day from the current 97,000.
The Canada-Newfoundland Offshore Petroleum Board is concerned about emissions from the burning gas. It said the limit will stay in place until the Hibernia group can show it can inject all of the gas that's produced with the oil back into the oil reservoir.
Hibernia is drilling a second well for that purpose and expects to finish it by the middle of next month. Production is still scheduled to peak at 135,000 barrels a day by the end of March, and the project is on target to produce its goal of 50 million barrels of oil in 1999, spokesman Brian Crawley said. "This is a short-term situation for us," he said. "When the second gas injector comes on stream we'll gradually increase production back up to where it is now."
Hibernia's largest shareholder is Fairfax, Va.-based Mobil Corp., the second-biggest U.S. oil company, with a 33.1-per-cent stake.
San Francisco-based Chevron Corp., the fourth-largest U.S. oil company, owns 26.9 per cent of the project. Other partners are Petro-Canada of Calgary, with 20 per cent; the Canadian government with 8.5 per cent; Murphy Oil Corp. of El Dorado, Ark., with 6.5 per cent; and Norway's Norsk Hydro ASA, with 5 per cent.
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