NOIA day two – Suncor’s Steve Hogan dishes on Terra Nova’s future

Suncor Energy Inc.’s Steve Hogan has been the Calgarty-based company’s top executive on the East Coast since February of 2017.

And with Hogan being the company’s point man in Newfoundland and Labrador (his actual title is vice-president, East Coast Operations), when he speaks publicly, it’s news.

Hogan was one of the speakers on day two at the annual NOIA oil and gas conference, and here is what he said about the future of the Terra Nova field – and a few others things – during a brief media scrum on Wednesday.

Hogan said during his time on the podium at the conference, the company is “months away” from making a decision on extending the life of Terra Nova and that decision will likely come in early 2019.

On the future of the Terra Nova field

The next big step is around life extension. As the operator our biggest opportunity in the near term is making a robust decision around life extension of Terra Nova. It’s an [extension] of about 10 years. It’s all around the economic resource potential that is there. We think it could have another 10 years of producing life.

Last summer we brought the Transocean Barents [drill rig] into the Terra Nova field for about a 15-month program. Within that program we are doing some abandonment work around some legacy wells, some work overs, and then some new drills. Most of the new drills are within the Terra Nova field, but there are a few locations where we are trying to push the southern extent of the asset to see if there is runway further south for development.

On whether ExxonMobil trying to sell its stake in Terra Nova is affect a decision on life extension project

It’s interesting. A lot of folks were surprised by that announcement. I wasn’t surprised at all. ExxonMobil is a big international oil and gas company, not that much different than Suncor. One thing we do on a regular basis is look at our portfolio and look for opportunities. I’d say that part didn’t surprise me at all. The relationship hasn’t changed at all. The work we’ve been doing – whether its the drilling program or life extension or day-to-day operations – they have been participating as always. I’m quite pleased with that. They are a great company. A great operator, and I like their opinion at the table. We’re moving ahead as if that is not going to be an obstacle.

On what does Suncor needs in order to go ahead with the life extension project

At a high level it’s pretty simple. With our base asset we need to be safe, reliable and cost competitive. We need to run a good business. In terms of that project, we need to make sure the cost and schedule required to execute that project, when layered against the resource potential, is economic . If we deliver on two of those things, I think we have a good opportunity to extend the life of the asset. We have to go to all owners, obviously. But we are talking about a 70 to 85 million barrels of resource remaining after 2020.

On what needs to happen for more exploration to occur in Newfoundland and Labrador

There are a lot of operators right now that have exploration acreage. What you hear a lot about publicly is some of the latest changes by the federal government around environmental approvals is creating some uncertainty. There is some dialogue around the potential doubling of the time to get approvals to get an exploration well. I’d say there is a bit of uncertainty around the exploration space that needs to be addressed and it is getting addressed. All we have is the draft version of the act, which we’ve reviewed. You’d need to talk about the flexibility with [the federal government] directly.

On Suncor’s current exploration plans

There is a land sale this fall. That’s quite commercially sensitive and I probably shouldn’t say more that. Stay tuned. Currently Suncor is not the operator on any exploration wells coming up in 2018.

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