15 November 2005

Sullivan's pockets swell

White Rose achieved first oil on Saturday November 12, 2005, bringing online production from the province's third oil field.

It is unclear if the provincial government factored in White Rose oil, in their recent economic update. If they didn't, then add White Rose's 100, 000 barrel a day production to finance minister Loyola Sullivan's swollen pockets.

Owing to the streamlined costs of bringing the project online, Terra Nova will achieve payout this year, adding to the provincial government's increased revenues. Once costs are paid, provincial royalties move to a higher rate under the royalty agreement with the Terra Nova operators.

A similar approach to White Rose, coupled with high oil prices, may see that project convert to Tier 2 royalties by 2008/09.