Natural Resources

White Rose Extension - Royalties and Benefits

Royalties

  • Basic Royalty:
    • The project pays 1 per cent to 7.5 per cent of gross revenue based on cumulative production and/or simple payout (same as existing generic)
  • Net Royalty:
    • Tier One royalty will apply to Expansion: 20 per cent of net revenue after Tier One payout (same as existing generic)
    • Tier Two royalty will apply to Expansion: Additional 10 per cent of net revenue after Tier Two payout (same as existing generic)
    • New super royalty adds an additional royalty of 6.5 per cent of net revenue, over and above the existing net royalty, when West Texas Intermediate crude oil trades above US$50 per barrel any time after Tier One payout

Industrial Benefits

  • All work that can be done in Newfoundland and Labrador will be done in Newfoundland and Labrador. Work that can be done includes: all Front-End Engineering and Design (FEED); detailed engineering project management; procurement management. This also includes the following fabrication work:
    • Manifolds, including foundations and piles
    • Flowline end manifold modules
    • Temporary and permanent guide bases
    • Rigid spools
    • Foundations for subsea distribution units
    • Riser gravity bases
    • Hull and turret modifications not requiring dry-dock
    • Topsides and turret module modifications
    • Hook-up and commissioning
    • Concrete mattresses (if required)
  • The operator estimates the project will require approximately 9.6 million person hours of work over its lifetime. Approximately 9 million (93 per cent) of those hours will be completed in Newfoundland and Labrador.
 
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