Ottawa Announces $41.5 Million for Offshore Oil Jobs in Newfoundland

The federal government is directing C$41.5 million to Husky Energy to help the company keep 331 workers employed on its West White Rose offshore oil development through the end of next year—even though there’s no decision yet on whether the project will go ahead.

The federal subsidy, which the Calgary-based fossil is expected match with its own funds, will come out of the $320 million bailout that Natural Resources Minister Seamus O’Regan announced for Newfoundland and Labrador’s struggling offshore oil and gas industry in late September, The Canadian Press reports.

Construction at West White Rose is 60% complete, CP says, but Husky announced last month that it would suspend work until the end of 2021. The project “is key to extending the life of the White Rose field,” spokesperson Kim Guttormson said at the time. “As we have said before, all options are on the table and accelerating abandonment remains a possibility.”

With no guarantee the project will restart, provincial opposition leader Ches Crosbie called the government announcement last week “a Band-Aid on a pulsating wound”, noting that the funds would only be sufficient to keep the project “in mothballs”. Since Husky had already committed to that, he said the federal largesse amounted to “found money” for the company.

Provincial NDP leader Alison Coffin pointed to the wider uncertainties surrounding the project and the province’s offshore oil sector. “We’re putting money into an industry that I don’t think is sustainable at all,” she told CP. “We’re hearing time and time again that the oil industry is in decline.”

Coffin added that it would have made more sense to direct the money straight to affected workers, rather than the company. “Many of those workers would like the opportunity to take control of their own destiny and be able to get the opportunity to transition to something else that is more sustainable for them,” she said.

Memorial University political scientist Russell Williams said the government is paying a steep price for the number of jobs it’s protecting, adding that oil and gas shouldn’t be the priority for federal support to O’Regan’s home province. “If we’re looking for financial assistance from the federal government, there are more important things,” he said.