A trading nation: 2011 update

Newfoundland and Labrador exports more to the United States than any other foreign location.  This is a point made in a 2005 post but more recent numbers tell just exactly how important a role the United States plays.

In 2008, total exports peaked at more than $10 billion.  Two years later, exports to the United States have only recovered to slightly more than it was in 2005;  that’s about $6.4 billion.

In 2010, the next largest export destination was Germany at $734 million, then China at $704 million.  It’s a big slide to the fourth largest export destination – the Netherlands – and $120 million in exports in 2010.  When you look at those figures, consider how foolhardy it was to ignore free trade negotiations with the European Union.

On the flip side, the largest import source for Newfoundland and Labrador remains Iraq at $1.8 billion.  Next is Russia at $595 million followed by the United States at $324 million.  The fourth largest import source is Venezuela.

If you are trying to figure out those import sources, think about the largest export destination.  Think of oil and you are in the right neighbourhood.  Iraq is the chief source of heavy sour crude for Come by Chance and on the flip side, all that refined product is destined for the Untied States.

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Americans open new offshore leases

The United States interior department announced today it had open lease sales on 48 million acres of offshore land in the Gulf of Mexico, offshore Alaska and the central Atlantic continental shelf off Virginia.

Interior secretary Dirk Kempthorne said the 21 parcels could yield as much as 10 billion barrels of oil and 45 trillion cubic feet of natural gas.

The total estimated potential oil reserves offshore Newfoundland and Labrador is 10 billion barrels.

The official news release described the five year outer continental shelf exploration program as follows:

There is no leasing proposed within 125 miles of the Florida coast or east of the military mission line in the Eastern Gulf. The program includes a Central Gulf sale in 2007 that involves a portion of the Sale 181 area and, as mandated by the Gulf of Mexico Energy Security Act of 2006, one lease sale in the Eastern Gulf in 2008.

The Act, signed by President George W. Bush on December 20, 2006, requires oil and gas leasing in a portion of the area known as the “Sale 181 Area,” consisting of 2,574,823 million acres, of which 2,028,730 is in the Central Gulf and about 546,093 acres is in the Eastern Gulf of Mexico Planning Area. The proposed sale area “181 South” consists of 5,762,620 acres. The total of new areas in the Gulf offered under the proposed program is 8,337,443 acres.

The leasing program schedules eight sales in Alaska: two in the Beaufort Sea; three in the Chukchi Sea; up to two in Cook Inlet; and one in the North Aleutian Basin – in an area of about 5.6 million acres that was previously offered during Lease Sale 92 in 1985. There are currently no existing leases in the North Aleutian Basin. These areas would be subject to environmental reviews, including public comment, and extensive consultation with state and local governments and tribal organizations before any lease sale proceeds.

The release included a backgrounder and fact sheet.

While some of the areas included in the interior department program would be new to exploration, the Gulf of Mexico lands are adjacent to a well-established oil and gas producing region with considerable infrastructure. As well, the Gulf Of Mexico is close to some of the largest refineries in the United States.

All of this increases competition for exploration attention in comparison to the Newfoundland and Labrador offshore. The local offshore holds and estimated 0.4% of the world's estimated oil and gas reserves.

An analysis of global trends in exploration were linked in this post on Australian energy development. The new head of Chevron discusses his company's global plans in the story and the podcast linked from this post.

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