TORONTO (miningweekly.com) – Long-term prospects remain encouraging for the oil sector in Newfoundland and Labrador, the Bank of Montreal (BMO) Blue Book, published on Wednesday by BMO Capital Markets Economics and BMO Commercial Banking, has found.

Much like the US Federal Reserve's ‘Beige Book’, the BMO Blue Book combines the expertise of BMO's economists with information on current business conditions provided to BMO's commercial bankers by local businesspeople.

“Investment in the oil and gas sector continues at a healthy pace, with construction of the Hebron project under way. Other projects such as White Rose - currently in its engineering phase - and a major discovery by Statoil in the Flemish Pass basin are expected to contribute to the economy in a great way over the coming years,” BMO Capital Markets senior economist Robert Kavcic said.

Many Newfoundlanders who gained experience in the energy industry have taken advantage of the opportunity to apply their skills back at home.

“The Muskrat-Falls hydroelectric project and the Hebron, Terra Nova, Hibernia and White Rose offshore energy projects continue to mature and provide high paying jobs and yield considerable economic spinoffs for the province. Statoil and Husky's Bay du Nord discovery north-east of St John's is also an exciting energy development for the province,” regional VP for commercial banking Allison Hakomaki said.

BMO senior VP for the Atlantic provinces division Carolyn Booth noted that 2013 was another banner year for Newfoundland and Labrador, with a strong economic performance across the province.

“Improved economic conditions globally, particularly in the US, have increased demand in the fishery market. Further, the decline in the relative value of the Canadian dollar has made fisheries exports more attractive globally and BMO's customers who operate in this industry are poised to benefit,” she said.

Booth added that the jobless rate sits at 11.6%, coming in well below the average of the past decade, and wages were growing at an above-average pace.

“This supports better trends in housing and consumer spending compared to the province's Atlantic counterparts - retail sales were up more than 3% year-over-year in the first two months of 2014 – despite negative population growth,” he said.