Ottawa, Ont. – Today, the Minister of Natural Resources announced $320 million to support the offshore oil industry in Newfoundland and Labrador, which is in addition to an earlier commitment of $75 million. This is not a wise or environmentally friendly use of money.
In these unstable times it is clear that we need economic resilience, but additional support for the oil industry will not yield that. With major oil analysts and companies announcing that the world is past peak oil, the federal government should direct aid to initiatives that will protect workers as oil production declines. Now is the time to pursue a long-term, planned exit from fossil fuel production that avoids prolonging and deepening the chaos of the past few months.
As plans are finalized for how the $320 million should be spent, the focus must be on building an economy that’s ready to weather the coming climate crisis. Investment in a resilient economy that provides good opportunities for the people of Newfoundland and Labrador, including workers in the oil industry, is badly needed. Instead of financing already heavily-subsidized oil companies, investments should be made in creating stable, long-term jobs in the low-carbon economy of the future.
That pathway does not include subsidies for the offshore oil industry.
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- Today the provincial government also announced that it will incentivize offshore oil and gas exploration through a promise to return deposits back to companies who do not follow through on their exploration commitments. This will result in an average of $300-400 million of foregone revenue for the province.
- In June, 23 Atlantic and other civil society organizations, released an open letter calling for the federal government not to provide funds for exploration drilling off the coast of Newfoundland and Labrador, and detailing the risks and opportunities available to the province.