No decision this year on West White Rose project, says Husky VP

Husky Energy continues to express confidence in the proposed West White Rose extension project in Newfoundland and Labrador's offshore, but the only certainty right now is that there won't be a sanction decision in 2016.

Malcolm Maclean, a senior vice-president with Husky, gave an update on the company's activities on the opening day of the Newfoundland Offshore Industries Association (NOIA) conference in St. John's on Tuesday.

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Maclean said the company is looking for more stability in oil prices before approving the multi-million-dollar extension to the White Rose oil field.

There has been a lot of volatility in oil prices, and that really isn't conducive to sanctioning a very large project.- Malcolm Maclean

"What we're looking for is a period of stability. There has been a lot of volatility in oil prices, and that really isn't conducive to sanctioning a very large project," Maclean told CBC News.

The extension is seen as the next big project in the province and could mean big things for the Town of Placentia, where Husky proposes building a concrete gravity structure at the newly built graving dock in Argentia.

Husky announced in late 2014 it was re-evaluating its options, however, and is now considering whether to build a concrete structure known as a wellhead platform, similar to Hibernia, or a subsea tieback to the existing SeaRose floating, production, storage and offloading vessel.

"No development decision has been made yet, but we are looking at ways to improve both options before we make our final decision," Maclean said.

Certain of some development

Maclean estimated the cost of both options at "several billion" dollars, adding, "That's why we need to be sure to choose the correct option."

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So is there a chance the project could be shelved altogether? Maclean said no.

"I'm certain that at some time there will be a development of the West White Rose extension, but what I can't say today is whether it will be a wellhead development or a subsea development," he said.

"I don't think there will be a decision in 2016, but we are watching oil prices and continuing to optimize the project."

The extension project will prolong the life of the White Rose field, and contribute millions more in royalties and other benefits to the Newfoundland and Labrador economy.