EnCana Corp.'s revamped Deep Panuke natural gas project received formal approval last week by Nova Scotia and Canadian regulators -- even though the company has not yet decided whether to proceed.

If EnCana's board of directors gives the project a thumbs up, the estimated C$700 million project would produce 300 MMcf/d by 2010. The field, is located about 250 kilometers offshore Halifax, is believed to hold about 632 Bcf of gas.

Nova Scotia Premier Rodney MacDonald said the government approval "is proof there is new momentum in our offshore. A momentum that will bring economic benefits to our region and jobs for our people."

EnCana had originally proposed a 400 MMcf/d deepwater project using three platforms, but with government approval, the proposal was withdrawn in early 2003 (see NGI, March 3, 2003). In mid-2006, EnCana resubmitted a scaled-down proposal that cut production estimates by 25% (see NGI, Sept. 11, 2006).

As it is now proposed, EnCana would guarantee that out of 1.35 million person-hours work in Nova Scotia, at least 850,000 hours would be done by Nova Scotians. The work would include jobs related to project engineering, design, procurement, fabrication and manufacturing.

Canadian Energy Minister Bill Dooks said the project, if it moves forward, would help spur exploration interest in Nova Scotia's offshore.

"This project represents new activity in our offshore, more people working, more investments and, ultimately, more interest in our resource," said Dooks. "It also shows industry that our regulatory reforms work and that we can approve projects quickly."

©Copyright 2007 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.