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Q.
Myth: Electricity is the number one energy source in Quebec.
Reality: Hydrocarbons (oil and natural gas) are the main energy source, as they account for more than 50% of Quebec’s energy demand. Coal: 1% Reference (French only) Reality: The economic situation of several Canadian provinces has changed a lot since the start of oil production. For example, in the late 1990s, the economic situation of Newfoundland was comparable to that of Gaspé today. In 2009 the government of Newfoundland and Labrador estimated the number of oil industry–related jobs at nearly 5,000. In 2011 the proportion of employees who were residents of this province was 93% for Hibernia, 92% for Terra Nova, and 92% for White Rose. In Quebec, the industry is in its infancy and therefore at the startup phase, so certain specialized services are not yet available in our province. However, it is important for Pétrolia to call on local businesses to build and prepare drilling sites, transport goods, and meet its various needs during operations. (http://bourque.petroliagaz.com/en/project/partners) Pétrolia aims to maximize the local spinoffs from these projects by promoting the employment of firms and workers in the communities in which it operates. This concern is reflected in a contract clause with our outside suppliers, with a view to encouraging them to do business with local companies for their work needs in Quebec. The industry’s development will have the same economic impact as in Newfoundland and Labrador. Reality: Many test wells have revealed the presence of oil in Quebec’s subsoil. In the Haldimand project, located in Gaspé, we estimate that there are nearly eight million recoverable barrels. The sedimentary basins of Quebec, which cover over 200,000 km2, offer potential for the discovery of new fossil fuel reserves. These basins stretch from the border with Ontario to the border with Newfoundland and Labrador, along the axis of the St. Lawrence River. The absence of oil production in Quebec is due to an insufficient level of exploration activity. Reality: This perception is due to the embryonic state of the industry in Quebec. In fact, exploration activities have been carried out in Quebec since the 19th century. The Gaspé Peninsula is one of the first places in Canada where oil was explored. In Quebec, more than 300 test wells have been drilled with a view to discovering oil. Thanks to Pétrolia’s recent work, there are new opportunities in Quebec. It is now possible to develop an oil industry in the province. Reality: The systematic opposition of these two sectors is not justified. In many areas where oil and gas exploration is carried out, the tourism industry continues to play an important role in the economy. The oil industry is an economic driver because it creates jobs directly and indirectly. Its impact on the tourism industry is generally positive. Again, Newfoundland is a good example. Oil production began there in the late 1990s with no negative impact on tourism observed. In fact, since 2003, the number of visitors from outside the province has increased annually by an average of 3% (5% for money spent) to reach 518,000 visitors in 2010. A report by North Dakota State University shows that for several years oil has been the second largest industry, followed by tourism. What’s more, tourism has continued to grow beyond that of surrounding states—by 37.6% since 2001 compared to 31% for the rest of the U.S. The same phenomenon has occurred in Alberta and Ohio. North Dakota has experienced major economic growth because of its oil sector. Reality: International Energy Agency forecasts indicate that global energy demand will increase 40% by 2035 and that oil will remain the world’s primary energy source. Although the relative weight of oil in the overall energy balance is declining, oil demand is growing. Replacing oil with renewable energy sources that appear less harmful, notably for transportation, is a long process. And in certain applications, there are simply no alternatives to oil at this time; for example, more than 6,000 everyday products are made from oil. Oil is therefore an invaluable resource, which must of course be used responsibly. More efficient use is a priority, even if Quebec’s subsoil seems able to partially meet our needs. Pétrolia’s long-term objective is to promote research and renewable energy. Reality: Thousands of commonly used products are made with oil, including synthetic rubbers (gloves, running shoes, balls, garden hoses, etc.), personal care products (soap, toothpaste, baby oil, make-up, etc.), fabrics (nylon, Orlon, carpet, etc.), and medical products (aspirin, Vaseline, alcohol, antibiotics, etc.). Even for transportation, there is no alternative for certain oil applications, as is the case in air transport. Reality: All human activities involve risk, and oil production is no exception. As with other activities, accidents are usually due to error, negligence, or technical failure. Compliance with industry and government safety rules makes it possible to reduce this risk to a very low level that compares favorably with that of other industrial sectors. There are millions of oil wells, the majority of which are located in inhabited areas. This is a mature industry that is in control of its technologies and that complies with the highest health, safety, and environmental standards. Reality: There are thousands of oil-producing companies of all sizes. Of course multinationals get more attention, mainly because their activities include distribution, which puts them in direct contact with consumers. Oil discoveries are often made by small exploration companies, some of which prefer to let bigger players develop the deposits they discover. At Pétrolia, we believe it is possible to establish a responsible Quebec oil company that produces local resources to meet local needs. In Pétrolia’s search for financing, maintaining control over permits and resources is a priority.
Q.
How many jobs will oil production create? Will there be jobs for people from the Gaspé Peninsula?
Pétrolia is still in the exploration phase, with a view to determining whether its production capacity estimates are correct. Production will be a long process spread over many months. As Pétrolia expands its activities and projects, its labor needs will increase. Many local subcontractors have already been called on to work in the region. The following list shows the services and jobs for which local workers are given priority.
We cannot yet confirm whether production will go forward, since we are still at the exploration stage. We are currently checking estimates we made based on data from seismic surveys conducted as part of exploratory drilling. The production duration will be determined by the amount of oil discovered, a number of other analyses, and confirmation drilling.
Q.
How will exploration and production activities impact other economic sectors?
Pétrolia aims to ensure harmonious integration in keeping with the region’s development vision. Many cases around the world show that oil activity stimulates the local economy (Alberta, Newfoundland, North Dakota, Texas, etc.). Pétrolia is a Quebec company and is fully committed to remaining one. We plan on employing as many Quebecers as possible for each of our operations, while respecting Quebec values.
There are three transportation options: truck, train, and ship. The production volume will dictate the method used to bring crude oil to the refinery. If the oil production is cost-effective, a land-use and development plan will be prepared together with the community. This plan is among the documents required to obtain a production lease. The next drilling program will provide answers to this question.
Q.
Do the wells drilled at Bourque No. 1 and Bourque No. 2 use hydraulic fracturing?
For more information No. The wells planned by Pétrolia are called conventional vertical wells. We will drill down through the reefs to reservoirs with the potential to naturally produce large amounts of oil.
No, since this would be impossible. So-called conventional wells can extract a maximum of 50% of the resource, while nonconventional wells can extract 5%. In the case of Bourque, we believe that if there is marketable oil, the ground porosity and permeability will allow us to extract nearly 40% of the total oil in the reservoir.
Q.
Do the oil resources form an underground pocket that will collapse after production?
No, because the oil and gas is found in pores in the source rock that are comparable to the pores in a sponge. This means it is impossible for there to be any land problem related to oil and gas production or exploration. As per the Environment Quality Act, contaminated drilling wastes must be transported to an authorized site. When drilling has been completed, the residual materials (mud and cuttings) will first be tested in a laboratory. Then, depending on the test results, they will be taken to an MDDEP-authorized treatment center or landfill.
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