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UPDATE; Nalcor negotiating with two companies on potential Bull Arm lease

Bull Arm fabrication site during Hebron construction.
Bull Arm fabrication site during Hebron construction. - file photo

Future of site could be secured by end of this month

A NorSea Group supply base in Norway. The photo depicts the port cluster model used there.
A NorSea Group supply base in Norway. The photo depicts the port cluster model used there.

SUNNYSIDE, NL — Since issuing a request for proposals for lease options for the Bull Arm site in October 2017, Nalcor has narrowed the selection down to two companies.

Nalcor — the government-owned electric energy company that owns the site— confirmed to the Packet this week that it has entered into negotiations with two of the four companies that submitted proposals to lease the fabrication site in Trinity Bay, just down the shore from Sunnyside.

Over the past 20 years Bull Arm has been the construction site of two gravity based systems (GBS) for the province’s offshore oil industry.

The latest — a GBS for Hebron — was completed last year and towed out to open water last spring.

Nalcor is currently negotiating with Canadian Supply Base Company (CSBC) and DFB Driver, and hopes to have negotiations settled by the end of March.

“Our focus is to secure a tenant, or multiple tenants, that will maximize site utilization and attract sustainable business opportunities,” Leona Barrington, public relations spokesperson for Nalcor, told the Packet. “We could potentially have both on site but it’s premature to predict the outcome of the negotiations at this point.”

"Their vision is to form a life-of-service supply base for the oil and gas industry, similar to what you would find in Norway." — Mark Browne, MHA for Placentia West-Bellevue, on meetings with officials from Canadian Supply Base Company

When Nalcor issued a call for proposals for the site, bids also came from Pennecon Heavy Civil and a joint submission from Cahill and Pennecon.

Over the past few weeks a representative from the Norwegian-based CSBC has been on the ground speaking to local governments near Bull Arm about their proposed plans for the site.

Sunnyside Mayor Gerald Snook told the Packet that CSBC vice-president Ian LaPointe met with the town council in mid-January.

“They want it to be a long-term, viable business that would maybe extend into 25 years of sustainable employment for people in the area,” Snook said.

Mark Browne, MHA for Placentia West-Bellevue, meet with LaPointe Feb. 28 to discuss site plans.

“It was fascinating. Their vision is to form a life-of-service supply base for the oil and gas industry, similar to what you would find in Norway,” Browne told the Packet.

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Brown says the CSBC has expressed setting up a “one-stop shop” idea, with all fabrication and service/supply being in one location – something Browne says is currently not in place in the province.

Both Browne and Snook told the Packet that CSBC is the only company to approach them regarding Bull Arm proposals.

Until Nalcor makes an official decision, one can only wait and see, said Snook.

“We do wait in anticipation; I’m sure our province would benefit from something like this, of longer sustainable work,” said Snook, adding if a deal is secured it would be a great opportunity for the region and for the Town of Sunnyside.

CSBC’s vision for Bull Arm

Ian LaPointe, vice-president of Canadian Base Supply Company (CBSC) – one of two companies currently in lease negotiations with Nalcor for the Bull Arm Site – outlined details of CBSC’s proposal for the Bull Arm site for the Packet.

LaPointe explained that CSBC is exploring development of a “Life of Field Service Centre” (LFSC). The centre would combine oil and gas fabrication with offshore supply base services (including quayside operations, warehousing, laydown areas, bulks and marine gas oil facilities), repair, maintenance and subsea services, and an industrial estate for supply and service companies.

“The type of port cluster proposed for Bull Arm would be similar to those operated by NorSea Group in Norway and those supporting offshore areas like the Gulf of Mexico,” explained LaPointe.

“These developments provide opportunities for companies to co-locate in a cluster. Mature clusters in these regions host over 50 companies permanently employing more than 2,500 people, in addition to project teams associated with fabrication projects.”

LaPointe adds this type of port cluster would create a sustainable, long-term business environment.

LaPointe further describes the LFSC as a “one-stop-shop,” supporting multiple oil and gas operators from discovery to production.

As CSBC is currently in a competitive proposal process, he could not comment on exact terms being discussed.

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