Hibernia maintenance will pay off over time: premier

A month-long shutdown of the Hibernia offshore oilfield will lighten Newfoundland and Labrador's treasury by at least $15 million, but Premier Danny Williams is nonetheless welcoming the decision.

Hibernia announced this week it is moving up a scheduled maintenance program to February to dovetail with fixing a generator that backfired in January.

The maintenance program had been scheduled for September.

"It will certainly increase our deficit for this year, but then it should improve our situation next year," Williams told reporters Wednesday.

Williams said the shutdown could cause a dip in provincial revenues by as much as $20 million.

However, he said the hit would have happened in the next fiscal year, and the maintenance program should prevent problems experienced last year at the neighbouring Terra Nova field.

Terra Nova's operators had to pull the floating platform and send it to a dry dock in Rotterdam. That shutdown lasted about six months and is estimated to have cost the province about $200 million in lost royalties.

"You know, I take those things as a good thing," Williams said.

"I understand that this is a preventative maintenance shutdown that'll be done obviously to ensure [that] things that don't happen in Hibernia that happened with Terra Nova," Williams said.

Last month's generator problem at Hibernia caused production to be scaled back from about 180,000 barrels per day to 120,000 barrels.