Economic Development Benefits of the Oil & Gas
Industry in Newfoundland & Labrador
Comments by:
John J Henley
VP Offshore Services & Development
G.J. Cahill & Company
OGDP Seminar May 2007
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Technical Benefits:
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Safe Work Practices including Permit to Work systems based on
international experience: The Oil & Gas industry has a very high safety
standard and local contractors must have them in place to do contract work
and have adopted these requirements in their other activities.
Environmental Awareness and Monitoring of activities: The programs and
procedures required to provide services to the Oil & Gas companies are
demanding and thorough. Contractors are using this knowledge on other
work.
Quality Assurance and Quality Control: Contractors are required to be ISO
9001:2000 compliant. This requires documented corporate procedures to be
in place along with a continuous improvement program. The QA/QC
program properly implemented improves a company in many ways that are
not easily qunatified.
OGDP Seminar May 2007
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Technical Benefits cont’d:
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Experience with Equipment: The offshore platforms consist of complex
process equipment including equipment not previously used in the province
i.e. 22 MW jet engines, axial flow gas compressors, high pressure pumps,
high volume pumps etc. The technical and maintenance community now
have experience on machines and equipment that can be exported to other
producing areas.
Design Experience: A large portion of the engineering technical work force
in the province have gained experience with state of the art design systems
including 3-D modeling, process simulation, international design codes,
sophisticated project management, shutdown planning etc. These skills are
needed for complex industrial projects but not for more conventional
commercial projects.
OGDP Seminar May 2007
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Socio-Economic Benefits:
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~20% of NL Government revenue due to Oil & Gas royalty and corporate
income tax.
Large pool of educated skilled personnel living in the province to support the
facilities. These people pay taxes and are active in the community.
Oil & Gas Industry is a significant contributor to social and educational
initiatives not funded by government. i.e. health care equipment,
scholarships, research etc.
Oil & Gas Industry provides industrial experience for work term students
and interns that was not previously available.
The industry provides role models and incentive for NL residents to get the
education and experience to participate in the industry. The NL participants
quickly learn they are as well trained and as capable as anyone else.
The industry is funded by private equity and is driven by solid business
fundamentals. There is much we can learn from the oil and gas companies
on how to invest capital wisely in long term projects.
OGDP Seminar May 2007
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