Record bid for oil exploration rights

Major oil companies are showing renewed interest in exploring off Newfoundland's east coast. Exxon Mobil, along with its Canadian subsidiary Imperial Oil, and Chevron will spend more than $672 million to explore eight parcels of land.

The Canada-Newfoundland Offshore Petroleum Board released the results of its latest land sale on Thursday afternoon. All the parcels are located in the Orphan Basin, north of the Hibernia and Terra Nova oil fields.

The total amount bid is a record for the province's offshore – more than three times the previous high.

Big players interested

Energy Minister Ed Byrne calls the results "very encouraging."

He says other companies were interested in this year's land sale, and "all of the big players are in the equation here, in terms of the global players."

But Byrne says people shouldn't think there's a guarantee of more oil being found. "This is just a critical first step."

"The first step has been achieved," Byrne says. "Now we have to cross our fingers that there are some real significant finds."

CNOPB site: 2003 Land sale

The companies have to spend the amount of money they've bid on exploration during the first five years of their nine-year leases.

No dates set

Margot Bruce O'Connell, a spokesperson for with Exxon Mobil Canada, says it's too early to say when exploration activities will begin.

Chevron has a 50 per cent share in all the bids, with Exxon Mobil and Imperial holding 25 per cent each.

The province's government and offshore oil industry have been eagerly awaiting the results of this year's bid.

There have been no significant new finds of oil off Newfoundland's coast in almost 20 years.

In the years following the initial Hibernia discovery, companies took advantage of federal incentives to explore offshore.

Between 1979 and 1991, they spent $2.8 billion looking for oil. Since then, only $643 million went into exploration.