DAILY NEWS Nov 20, 2012 10:18 AM - 0 comments

Nova Scotia grants BP rights for deep water oil offshore exploration

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The day after BP agreed to pay a record $4.5-billion settlement to the U.S. Government and pleaded guilty to 11 deaths in the disastrous Gulf of Mexico oil spill, the Government of Nova Scotia announced that it had granted the company exploration rights for four deep water drilling sites offshore.

On Thursday, November 15, BP agreed to pay $4.6 billion to the U.S. Government and pleaded guilty to causing the deaths of 11 oil rig workers when the Deepwater Horizon rig exploded 80 kilometres from Louisiana on April 20, 2010.

Associated Press reports noted the $4.5-billion settlement was "well within BP's means, considering the oil giant made a record $25.8 billion in profits last year." Greenpeace said it was "a slap on the wrist" for the oil giant.

Then on Friday, November 16, Premier Darrell Dexter announced in Halifax that BP Exploration Company had committed to spending $1.1 billion in exploring four deep-water parcels in Nova Scotia's offshore water.

He emphasized that the revenues would enable the province to invest in infrastructure and programs: "This investment will mean more good jobs and hundreds of millions of dollars in revenue that will be used to improve health care, education, and build roads to help make life better for Nova Scotia families."

The province has also awarded explorations to Shell Canada for another four parcels, two in deep water, amounting to $1 billion over six years.

Premier Dexter also said that the Canada-Nova Scotia Offshore Petroleum Board "oversees a careful and vigilant bid process to determine exploration rights. The board also has one of the most stringent regulatory regimes in the world to ensure businesses that operate in Nova Scotia do so in a safe and responsible manner."

Geoscientific studies suggest a potential 120 trillion cubic feet of natural gas and eight billion barrels of oil in Nova Scotia's offshore areas.

For the Deepwater Horizon disaster, BP's settlement includes $1.3 billion in fines, the largest criminal penalty in the history of the U.S. according to Associated Press. Oil gushed from well for 85 days into the Gulf of Mexico before it was capped, spilling an estimated 780 millions of crude and causing damage to the environment that won't be fully known for decades. An investigation found that the explosion was caused by the company taking short cuts in cementing the well shaft during its construction. Two BP rig workers have been charged with manslaughter.

The company also still faces enormous civil claims from fishermen, restaurants and property owners, amounting to $7.8 billion.

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