The new regulations were introduced in 2004 by the offshore regulatory board, which is jointly managed by the federal and provincial governments.
But here's the thing: if the current R & D regulations are considered a violation of NAFTA, shouldn't we wonder what implications that has for the newly minted Hebron deal?
Tha association representing the oil producers made a submission to the energy plan that said:
The Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB) recently implemented new research and development (R&D) guidelines which outline the amount of money operators have to spend on R&D over the life of their projects. It is CAPP’s position that the R&D guidelines should not prescribe amounts to be spent on R&D, as this will create a substantial cost burden to Newfoundland and Labrador operators. CAPP continues to work with operators to lobby for modifications to the new R&D requirements.The only reference to R & D regulations in the energy plan is the one that says the offshore board makes the regulations.
And the Hebron memorandum of understanding sets a fixed amount:
Fixed R & D amount of CAD $120 million over the life of the project, provided such commitment meets the C-NLOPB’s requirements.
Now it is subject to the offshore board requirements, but if the MOU sets a fixed amount ,that amount would likely prevail in the development application approval.
And that's the question:
- Is the fixed amount negotiated for Hebron R & D the same, higher than or lower than existing offshore requirements?*
-srbp-
Update (2012): The CNLOPB amount would have been much higher than the flat amount demanded by the provincial government.
