No Spanish rendezvous for aging Terra Nova platform due to pandemic

In yet another setback for Newfoundland and Labrador's offshore oil industry, a planned overhaul of the floating platform at theTerra Nova fieldat a Spanish shipyard this year is now in limbo because of COVID-19.

"We are currently evaluating alternate options for the Terra Nova" life extension project, a Suncor official wrote Wednesday afternoon in a statement to CBC News.

The floating production, storage and offloading vessel was scheduled to arrive at the Navantia shipyard in southern Spain in May, with the work to be completed in September.

But with Spain locked in the grips of the COVID-19 pandemic, those plans have now been shelved.

"Spain is no longer able to accommodate the dry dock slot," the Suncor statement added.

It's the second time in as many weeks that the situation in Spain has dealt a blow to the offshore industry off Canada's east coast.

• Chinese oil company announces delay of Flemish Pass drilling campaign

CBC reported last week that the drillship Stena IceMax was unable to leave port in the Spanish Canary Islands because of concerns over the virus.

The IceMaxhas been contracted by Chinese oil company CNOOC International to do exploration drilling in the Flemish Pass, but was unable to enter Canadian waters because of the pandemic.

• Hibernia drilling to stop for as long as 18 months as cost-saver, but production will continue

The industry is also reeling from news that Hiberniais poised to suspend drilling activities next month and lay off workers as part of a broader cost-cutting strategy.

As well, the owners of the Come By Chance oil refinery have also decided totemporarily stop making fuels and send home most of its employees.

Work on Husky's West White Rose project has also ground to a halt, and other oil players, including Equinor, have announced measures to trim spending and find efficiencies.

Bad news for aging installation

It's all in response to a sharp decline in prices due to a collapse in oil consumption, and the challenge of storing the growing inventory of oil.

For the Terra Nova FPSO, thismeans a plan to extend the life of the vessel by 10 years in order to produce an additional 80 million barrels of oil is now on hold.

That's bad news for the operator, Suncor Energy, and its six partners, its workers, and a cash-strapped provincial government that is heavily dependent on oil revenues.

It's just the latest trouble for an aging installation that hasn't produced oil since late December, when it was ordered to shut down by the board that regulates the province's offshore industry.

On Dec. 19, the C-NLOPB ordered Suncor to suspend oil production becausethe company had not met the standard for having redundant fire water pump systems aboard the installation.

While the water pump issue has been corrected,the production suspension order remains in effect"while Suncor carries out other maintenance work and implements corrective actions with respect to their maintenance management system," according to a statement Wednesday from the board.

Meanwhile,the Terra Nova platform, which began producing oil in 2002 some 350 kilometres southeast of St. John's,remains stationed in the offshore.

The FPSO can accommodate up to 120 workers, but Suncor says only essential staffing levels are being maintained as a health and safety precaution in this era of COVID-19.

"The team on board isfocused on safelycarrying out essential critical maintenance work," theSuncorstatement reads.

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