Drilling offshore is much more expensive than drilling onshore. The cost of drilling is very much influenced
by environmental conditions. Factors such as distance from land, water depth, well depth, weather
conditions, the presence of pack ice and icebergs all affect the cost of an offshore well. For example, on the
Grand Banks of Newfoundland, in 1991, the average well takes from 60 to 70 days to drill and costs approximately
$16 million. These well costs can only be justified in areas where there is a good chance of
finding very large fields. Offshore Newfoundland and Labrador is one such area. Figure 9.6 shows other
areas in the world where offshore drilling has occurred.