Canada based oil and gas company Husky Energy is reviewing its West White Rose field development in the Jeanne d’Arc basin offshore Newfoundland and Labrador due to the spread of COVID-19.
Husky announced the review, which follows the suspension of major construction activities in March due to the COVID-19 pandemic and the company’s capital re-prioritization following the global economic downturn.
“A full review of scope, schedule and cost of this project is critical, given the minimum one-year delay to first oil caused by COVID-19, and our priority of maintaining the strength of our balance sheet with ample liquidity,” said CEO Rob Peabody.
“Unfortunately, the delay caused by COVID-19 and continued market uncertainty leaves us no choice but to undertake a full review of the project and, by extension, our future operations in Atlantic Canada.”
With an expected peak capacity of 75,000 barrels of oil per day (approximately 52,500 bbls/day Husky working interest), West White Rose is designed to produce light crude oil at low incremental cost and with lower greenhouse gas emissions intensity than other North American crude oil projects.
Construction at Argentia and Marystown was halted in March 2020 and construction workers demobilized due to COVID-19.
The third quadrant of the concrete gravity structure (CGS) and two interior decks were completed, and the fourth and final CGS quadrant was completed in October.
The project is 60% complete, however, all major construction remains on hold while Husky determines a path forward, given a start-up delay of at least one year due to a tight offshore weather window.