This is the biggest find in years for the island of Newfoundland
With global investment in offshore drilling at near-record highs, new oil fields are popping up across the planet. The five largest oil fields in the world right now are:
The Safaniya field, is located off the coast of Saudi Arabia. This is a 50-year old field that houses over 50 billion barrels of oil. 36 billion of which is deemed recoverable. The Upper Zakum is the second largest, and the Manifa Reserve is the third largest field yet discovered.
The Santos Basin is located off the coast of Brazil and is the fourth largest offshore oil reserve, while the Kashagan oil field in the North Caspian Sea is the fifth. These reserves contain an incredible amount of oil, and have been producing a large portion of the world’s oil supply for decades.
The newest discoveries off the coast of Newfoundland may not be quite as large as these behemoth oil fields, but the economic gains for the small, Canadian region may be staggering.
Who gains from this newly discovered oil reserve?
The economy of Newfoundland is heavily dependent on oil production. In fact, the total GDP for the nation relies on oil for as much as 33% of the total figure. The problem is, oil extraction has fallen off quite rapidly over the past few years. In fact, the total regional oil production has fallen by over 25% – and that is just comparing 2011 to 2012 total figures. Total 2011 production of 266,000 barrels per year compares to 197,000 barrels per year in 2012. Free fall is an adequate way to describe the situation in Newfoundland.
An increase of oil production may be possible over the next 5-7 years by tapping into this potential reserve. The region already realizes nearly $10 billion in revenues and royalties from oil production, so this new find may add significantly to the economic well being of this small, Canadian island.