Da Legal Stuff...

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Tuesday, August 21, 2007

Breaking News - Province Signs Deal on Hebron Oil Project

A press conference is tentatively set for tomorrow morning to officially announce a deal between Newfoundland and Labrador and the oil consortium involved in negotiations over development of the Hebron oil project.

At this point all the details are not known but both NTV and CBC are confirming that the deal includes a 4.9% equity position for Newfoundland and Labrador and a "super" royalty regime, something that has not been accomplished on any of the currently existing projects.

It is expected that the new royalty regime may mean between 8 and 10 billion dollars for the province in addition to the potential revenue to come from its equity stake.

As with any contract, the devil is in the details and over the next day or so, as more details are announced, the content of the contract will be discussed and analysed in further detail.

6 comments:

Ussr said...

OK ,sure.It sounds OK right now,but whats it going to cost us in a few weeks .Our first born and a sacrafice to what Gods.

I'll wait to see this before I believe any of it!!!

I bet you my first born Patriot that this is somehow tied into the Lower ChurchHill,you wait and see. ;)

Edward G. Hollett said...

it would have to mean more than US$8 to $10 billion since that's what the deal was worth in 2006.

touton said...

There was no deal in 2006 remember. Besides, the value depends on oil prices, not the calendar.

Good try.

Ussr said...

"HOLY Sweet Christmas,8 Billion!!!"

And ,Have Not Shall be No More.Has He Done It???

Edward G. Hollett said...

The value of the deal depends on a number of things, touton.

The figures people use are based on an assumed average price of oil as well as the royalty and other revenues.

Wade Locke came up with the figure range of $8 to $10 billion based on an assumed price of oil and using the old royalty regime.

All things considered, the nice try would be yours.

codhooked said...

We will only know the value of the deal when knowledgable non-partisans provide an honest and concise summary of the deal that regular folks can wrap their heads around.

I fully expect Danny Williams to praise the deal up and Gerry Reid to tear the deal apart, no news there.