Decision No. 123-W-2010

April 12, 2010

File No. W9125/P5/10-11

INTRODUCTION

Application

Chevron Canada Limited (Chevron) applied, through its representative, for a licence to use an unknown ship to support the "STENA CARRON" in the drilling operations of a single deepwater exploration well in the Orphan Basin, off the coast of Newfoundland and Labrador, commencing on March 25 and ending on April 30, 2010.

Notice and offer

On March 18, 2010, Canadian Transportation Agency (Agency) staff gave notice of the application to the Canadian marine industry. In response to the notice of application, Secunda Marine Services (Secunda) offered the "MARINER SEA", a Canadian duty paid ship.

ISSUE

Is there a suitable Canadian ship available to perform the activity?

SUBMISSIONS AND FINDINGS OF FACTS

Secunda acknowledges that its ship is not available during the period proposed. However, Secunda points out that there will be no work to be performed for the period of activity indicated in the application as the drillship "STENA CARRON" is currently performing work for ConocoPhillips Canada Resources Corp. (ConocoPhillips). This work is scheduled to terminate by June 30, 2010 as set out in a current coasting trade licence issued for the "TROMS CASTOR". According to Secunda, there is therefore no requirement for Chevron to use an unknown ship to support the drillship "STENA CARRON" in the Orphan Basin before May.

Chevron submits that ConocoPhillips has recently achieved better than expected drilling progress and could finish the drilling of the well and release the "STENA CARRON" by April 16, 2010. Chevron states that it needs the support ship to be available 7 to 10 days in advance of the drillship hand over to begin mobilizing the equipment.

The Agency is of the opinion that the fact that another coasting trade licence has been issued for a period of activity ending on June 30, 2010 to support the "STENA CARRON" drillship does not refute Chevron's argument that the "STENA CARRON" could be released as early as April 16, 2010 and result in a requirement for the unknown ship to commence work at anytime during the period of activity stated in the application. It is not uncommon for a coasting trade licence applicant to apply for a proposed commencement date which depends on factors that are not under its control. In such a situation, the commencement date could be different from the actual start date.

Secunda has acknowledged in its submissions that its ship is not available for the proposed period of activity as it would only be available from May 1, 2010. Therefore, the Agency finds that there is no Canadian ship available to perform the proposed activity.

Having found that there is no Canadian ship available, there is no need for the Agency to address the issue of suitability of the Canadian ship offered.

DETERMINATION

In light of the above findings, the Agency determines, pursuant to subsection 8(1) of the Coasting Trade Act, that there is no suitable Canadian ship available to perform the activity described in the application.

The Agency is providing this determination to the Minister of Public Safety and Emergency Preparedness to consider whether to issue the licence. This Decision is not an authority to operate.

Members

• Jean-Denis Pelletier, P. Eng.
• Raymon J. Kaduck