While the rest of the world is dealing with the “double whammy” of COVID-19 and a struggling oil sector, Newfoundland and Labrador’s dependence on its energy industry means the closure of its Come By Chance oil refinery would be that much more devastating for its economy, according to the province’s industry minister.

“The big issue that we face is that when you have a province of 500,000, with 30 per cent of your GDP coming from oil and gas and this is your only refinery, we're perhaps feeling the pain more significantly than some other jurisdictions,” Andrew Parsons told BNN Bloomberg in a television interview Thursday.

Newfoundland and Labrador’s battered oil sector suffered a major blow after a deal, which would have seen the sale of the idled Come By Chance refinery, collapsed earlier this week.  Irving Oil Ltd. withdrew its bid for operator North Atlantic Refinery Ltd., putting the future of the refinery that employs about 500 people into question.

U.S.-based company Origin International Inc., which had previously bid for the refinery before the Irving deal fell through, said it’s still interested in buying it. Parsons says that the provincial government is now having talks with Origin, but that the company is still at early stages of the purchasing process.

“There's a cautious optimism here, but at the same time we're not getting too ahead of ourselves in the process,” Parsons said.

He added that a federal aid package meant to help the province’s struggling energy sector is not nearly enough to solve the industry’s “billion-dollar issues.”

He said the $320 million Ottawa allocated for the sector in September is a small amount of money when considering the “extremely substantive” capital oil and gas companies in the province are currently requesting.

“When you think about the size of the needs of these operators – into the billions when you look at it all – $320 billion is not the hugest amount,” he said.

Husky Energy, which is currently reviewing operations in the province after halting construction of its West White Rose offshore oil project, has previously said the subsidy is not enough for them to consider a restart.

Parsons says more needs to be done to keep the industry afloat.