Nova Scotia, Ottawa veto decision to issue offshore petroleum exploration licence off Sable Island

In a move being praised by environmental groups, Nova Scotia and Ottawa have vetoed a regulator'sdecision to issuean oil and gas exploration licence toInceptio Limited.

The Canada-Nova Scotia Offshore Petroleum Board had awarded rights in October to Inceptio for a parcel of seabed in shallow water near Sable Island. But Ottawa and Nova Scotia suspended the licence last month.

In a joint release on Monday,Nova Scotia's Natural Resources and Renewables Minister Tory Rushton and federal Minister of Energy and Natural Resources Minister Jonathan Wilkinson said they had confidence in the regulatory process.

"However this decision must account for broader policy considerations, including our shared commitments to advance clean energy and pursue economic opportunities in the clean energy sector, which are beyond the scope of the [Canada-Nova Scotia Offshore Petroleum Board's] purview," reads the statement.

"This decision will enable us to research and understand the interactions between the two industries as we transition to our clean energy future."

The joint release also notedNova Scotia and Ottawa are looking to start a "joint regulatory regime for offshore renewable energy," whichwould be done by changing the Atlantic Accord Acts to "expand the board's mandate so that it can regulate and enable the development of an offshore wind sector in Nova Scotia."

"This will ensure that Nova Scotians can seize the economic benefits associated with the energy transition, including the projected $1-trillion global market opportunity for offshore wind," the release said.

Decision praised by environmental group

The decision to veto the exploration licencehas been applauded by environmental groups. In a news release,Sierra Club Canada said the water parcelwould have been sandwiched between Sable Island and the Gully Marine Protected Area off the Nova Scotia coast.

"We were very concerned about the impact of seismic blasting and drilling on marine life, particularly on northern bottlenose whales in the Gully," Gretchen Fitzgerald, the national program director with the Sierra Club of Canada Foundation, said in a news release.

"We're so relieved this licence has been dropped and we can get on with urgently needed climate solutions such as offshore wind."

Fisheries critic disappointed

Federal Conservative fisheries criticRick Perkins, who is alsothe MP for South Shore-St. Margarets, said he was disappointed by Ottawa and Nova Scotia's decision. He said hehoped the provincial government would have at least wanted to expand offshore and gas.

"I guess the Sierra Club decides on what economic benefits should happen in Atlantic Canada," Perkins told CBC News.

Inceptio'saward of the offshore exploration licence had been the first in Nova Scotia in eight years. The province's two producing offshore natural gas fieldsExxon's Sable ProjectandEncana's Deep Panuke were both shuttered in 2018.