$400 Million To Be Spent On Newfoundland Offshore Oil Drilling This Year

The Honorable Neil Windsor, Newfoundland's Minister of Development, recently reported that $400 million will be spent in drilling for oil off the coast of his Canadian province this year, and that oil production should begin by 1987.

Noting that Mobil's Hibernia find alone contains 1.85 billion barrels of oil and two trillion cubic feet of gas, Mr. Windsor told business editors attending a Newfoundland press luncheon at the Waldorf-Astoria Hotel in New York City recently: "The important thing to keep in mind is that these excellent results have been achieved despite the fact that oil exploration permits cover only one-eighth of our continental shelf which covers 730,000 square miles." The Newfoundland Government official said that offshore oil was but one of the developments which "has placed Newfoundland on the threshold of major social and economic change over the next 10 years." He disclosed that a decision will be made late this year on whether to develop the Gull Island hydropower site, the Muskrat Falls site or both, on Labrador's Churchill River. The Muskrat Falls plant would cost $3 to $4 billion, while the Gull Island project would cost $4 to $6 billion.

Present plans call for development by 1987.

"The Gull Island site alone would be equivalent in oil terms of 100,000 barrels a day, renewable forever," Mr. Windsor said, noting that Newfoundland has been having discussions with such potential users as the Power Authority of the State of New York, and a number of energy intensive industries.

Mr. Windsor also discussed other promising developments which offer new opportunities for investors.

Thanks to the 200-mile limit, Newfoundland's landed volume of fish is expected to double by 1985.

Over the past two years alone, landings have increased by 29 percent from 569,000 to the 739,- 000 metric tons expected this year. The upsurge in Newfound- land's fishing industry opens new opportunities for manufacturers of fishing gear, vessels, and related equipment, with even more opportunities for food processors capable of producing finished consumer products as well as companies in canning, bottling, pickling, and related product lines.

Over $1 billion of the province's exports is ore, of which 85 percent is iron ore produced in Labrador.

In addition to iron, the province produces zinc, asbestos, gypsum, copper, lead, gold, silver, cadmium, and talc. Recently, there have been finds of uranium, chromite, tungsten, and molybdenum.

Due to 1977 legislation which increased the tempo of exploration, the number of stakes increased from 300 to 6,244 claims in 1979, with a further 13,099 claims in 1980.

Labrador contains 41-million cords of high-quality spruce and fir which could lead to an annual cut of 150,000 cords. Pilot projects to ship the production via special icebreakers year-round have proved successful.

Manufacturers of plastic products, sheet metal and cast items, marine electronics, survival and safety gear, and numerous other items should find Newfoundland a feasible and profitable site in the wake of the province's accelerated development tempo.

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