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The pre-sale statistics are attached.
The table below compares the pre-sale stats for BBG3 with those for BBG1 and 2. The number of BBG3 bids, while well below BBG1, which was the first sale in 2 years, bounced nicely from BBG2 levels.
| BBG1 12/10/2025 | BBG2 3/11/2026 | BBG3 8/12/2026 | |
| tracts bid on | 181 | 25 | 59 |
| total bids | 219 | 38 | 69 |
| shelf bids (<200m) | 12 | 2 | 12 |
| deepwater (>400m) | 168 | 23 | 47 |
| companies bidding | 26 | 10 | 12 |
Posted in energy policy, Gulf of Mexico, Offshore Energy - General | Tagged BBG1, BBG2, BBG3, bids, big beautiful Gulf of America, lease sale, MMA, oil and gas, pre-sale stats | Leave a Comment »
Excerpts from Sable’s quarterly report:
Production
- An average of approximately 39 wells were online throughout the month of June 2026, representing a 50% increase over approximately 26 wells online on average in April 2026.
- In July 2026, an average of approximately 47 wells at Platforms Harmony and Heritage were online, producing an average of approximately 721 gross barrels of oil per day per well. Sable expects to bring all 77 production wells on these two platforms online during the third quarter of 2026 and expects Platform Hondo to come online in September 2026.
- Wireline campaign for Perforation Additions (“Perf Adds”) and producing well optimization at Platform Harmony commenced in August 2026.
- Five completed Perf Adds forecasted to produce an incremental 600 estimated gross barrels of oil per day, each, are expected to come online at Platform Hondo along with the restart of the platform in September 2026.
- An additional four Perf Adds at Platform Hondo forecasted to produce an incremental estimated 600 gross barrels of oil per day are planned for completion and to be brought online in early Q4 2026.
Sales
- July 2026 preliminary oil sales estimate of approximately 38,000 gross barrels of oil per day. August 2026 oil sales average to date is approximately 42,000 gross barrels of oil per day through August 9th.
- Due to the California regulatory environment, local refineries were not able to plan in advance for SYU first sales and ultimately were forced to displace various imported cargos in the second quarter. As a result, Sable incurred $18.5 million of non-recurring demurrage charges throughout the quarter, recognized in operational expenses.
- The sudden supply influx of Pacific Outer Continental Shelf (“Pacific OCS”) crude has forced refiners to temporarily limit throughput of Pacific OCS crude and charge quality deducts for sulfur content and other items.
- Starting in July 2026, Sable was temporarily constrained to a maximum of 40,000 average gross barrels of oil per day of oil sales throughput by downstream partners. We expect this short-term constraint to be alleviated starting in the back half of August.
- California refineries are expected to adjust their crude oil supply slate starting in September 2026 to begin accepting more Pacific OCS barrels from the SYU and less imported barrels, alleviating the SYU throughput constraint altogether.
- Sable is also in active negotiations to implement waterborne crude oil marketing solutions from existing marine terminals in the Los Angeles area in the near-term in order to improve marketing optionality.
- Additionally, the pending acquisition of the Crimson Utilities (San Pablo Bay Pipeline) pipeline network by a third party could provide further relief and marketing optionality to California oil producers with access to the San Francisco refinery market once that pipeline potentially restarts operations.
A detailed regulatory and legal update can be found beginning on p. 13 of the Quarterly Report.
Posted in California, energy policy, Offshore Energy - General, Regulation | Tagged Harmony, Heritage, Hondo, oil production, quarterly update, Sable Offshore, Santa Ynez Unit | Leave a Comment »
Barbados 2026 Offshore Petroleum Direct Negotiations process is underway. Nineteen blocks (yellow in map) are being offered. Direct negotiations for pre-qualified companies will continue through January 15, 2027, and awards will be announced by February 15.
I’m convinced! 😉
Posted in Barbados, energy policy, Offshore Energy - General | Tagged 19 blocks, Barbados, direct negotiations, offshore oil | Leave a Comment »
RWE has agreed to relinquish their Atlantic, Pacific, and Gulf of America wind leases.
“After careful consideration, it was determined there is no path forward to permit these projects in the U.S. for the foreseeable future.”
Comment: The poor prospects for these leases had more to do with bad investment decisions than permitting challenges. The company is fortunate to be able to rollover their lease bonuses into LNG infrastructure and gas turbine purchases.
The relinquished leases:
OCS-A 0539: RWE paid the highest bonus ever, $1.1 billion, for this lease at the irrational exuberance Atlantic wind sale in Feb. 2022. The amount was $305 million higher than the next highest bonus for any offshore lease.
OCS-G 37334: RWE was the only bidder at the 2023 Gulf wind lease sale. A second Gulf wind sale received no bids.
OCS-P 0561: RWE underestimated the technical and economic challenges associated with deepwater floating wind development offshore California and elsewhere. Only one wind lease remains in the Northern California wind lease area. Two of the three wind leases in the Central California area have also been relinquished.
The wind adverse U.S. Administration offered RWE a lifeline that allows them to reinvest in more prospective projects:
- LNG infrastructure: a financial investment of $900 million to acquire an indirect 16% stake in the Louisiana LNG Project. RWE proceeds will be used to fund the construction of the terminal.
- Natural gas turbine reservations: To support the expansion of its growing flexible power generation work in the U.S., RWE Americas has signed a $300 million turbine reservation agreement securing future generating capacity to meet growing U.S. electricity demand. The company is developing a pipeline of 15 natural gas peaking projects across target markets in the U.S.
Apparently, the attached letter from 50 U.S. environmental groups asking RWE not to keep their wind leases was not persuasive (and perhaps RWE didn’t appreciate the implied threat of litigation against a deal that was in the company’s best interest).
Posted in natural gas, California, Offshore Wind, Gulf of Mexico, energy policy | Tagged Atlantic wind, floating wind turbines, Gulf of America, irrational exuberance, lease buybacks, Pacific, record bonus bid, RWE | Leave a Comment »
Contrary to what you might see or read on social media, the Strait of Hormuz has not “opened” by continental rifting between Iran and Oman. This waterway is the locus of converging plate tectonic interactions between the Arabian and Asian plates and offers a natural laboratory to study plate tectonic subduction and collision.
This narrow waterway, only 60- to 24-miles wide, is the passage for one-fifth of the world’s oil transportation, or about 20 million barrels per day. According to the International Energy Agency, 80 percent of this oil goes to Asian markets; however, any major disruption in oil flow impacts the global economy because of the international connectedness of the oil industry.
Posted in Uncategorized | Tagged Strait of Hormuz, geology, plate tectonics, oil transport | Leave a Comment »
The proposed revisions to the Arctic drilling regulations are a positive initiative that will improve the prospects for renewal of Beaufort and Chukchi Sea exploration.
In particular, removing the same-season-relief-well (SSRW) requirements in the current regulations is an essential regulatory action. The SSRW provision has the effect of precluding exploratory drilling while providing no added environmental protection and increasing operational risks. Given that there is at least a 50% chance that rig mobilization, relief well planning, drilling, repeated surveying, and plugging the flowing well would take more than the specified 45 days, a SSRW is not a legitimate well control option.
The preamble includes important questions for respondents. These questions are compiled beginning on p. 108 of the attachment. In particular, the comments on Subsea Isolation Devices (SSIDs) should be interesting. Given the required blowout preventer stack redundancy, it’s not clear to me that SSIDs would reduce blowout risk. They would however increase operational complexity.
For floating drilling operations in the Arctic and elsewhere, the focus needs to be on well design, integrity, and control. Fortunately, by carefully verifying casing and cement integrity, ensuring complete barrier redundancy, and having standby capping and containment capability, the probability of a sustained oil blowout can be reduced to 10–6 or lower.
Lastly for now, these regulations further demonstrate the importance of consolidating BOEM and BSEE in a single bureau.
Posted in Alaska, energy policy, Offshore Energy - General, Regulation, well control incidents | Tagged Arctic drilling, BOEM, BOP, BSEE, MMA, regulations, same season relief well, subsea isolation device, well control | Leave a Comment »
The proposed revisions to the Arctic drilling regulations have just been posted and are attached for your convenience.
From a risk management standpoint, the current Arctic drilling rule, particularly the same season relief well (SSRW) provisions, is arguably the worst in the history of the OCS program. Regardless of the prospects for Arctic exploration, offshore drilling is not feasible under the current regulations. Hopefully, this proposal represents a significant improvement. More to follow after the text has been reviewed.
Posted in Alaska, drilling, energy policy, Regulation | Tagged Arctic drilling, BOEM, BSEE, Marine Minerals Administration, proposed regulations, SSRW | Leave a Comment »
Interesting article by Amanda Van Dyke. Highly recommended.
There are 67 NGOs with observer status at the International Seabed Authority (ISA) as of March 2026, which explains why nothing gets done. More than thirty years after its creation, there is still no final Mining Code for nodule exploitation.
“Deep‑sea mining disturbs low‑productivity abyssal ecosystems and may have long‑lasting local effects on small communities of widely distibuted organisms reliant upon the nodules themselves, but avoids the deforestation, human displacement and occupational hazards of many terrestrial mines. The ethical question is whether it is better to concentrate impacts on a relatively small portion of the most common habitat on Earth, or to continue expanding high‑impact mining frontiers on land like tropical rainforests.“
“The job of a regulator is not to deliver closure for activists. It is to regulate access to resources designated as the “common heritage of mankind” in a way that balances environmental protection, equitable benefit sharing and global development needs. That will always involve trade‑offs.“
Posted in deep sea mining, energy policy, Offshore Energy - General, Regulation | Tagged Amanda Van Dyke, deep sea mining, International Seabed Authority, low impact, marine minerals, Regulation | Leave a Comment »
Per EIA, Gulf of America oil production declined in May by over 200,000 bopd from April’s record production, which was corrected upward by 2000 bopd. Was the April number anomalous? We’ll need additional monthly data and the audited ONRR numbers to get a better read.
EIA posted corrected April and May totals of 30,000 bopd for the Pacific (California OCS), a 150% increase from February owing to the Sable Santa Ynez Unit restart. Although Pacific OCS production has been in the doldrums for years, the region has an impressive record of 202,000 bopd from Dec 1995.
Meanwhile EIA has still not corrected their 2025 OCS production totals to correspond with the audited ONRR data.
| 2025 OCS total – ONRR | 2025 OCS total – EIA | 2025 Gulf only – ONRR | 2025 Gulf only – EIA |
| 713,673,419 | 697,020,000 | 708,803,859 | 692,634,000 |
Posted in California, energy policy, Gulf of Mexico, Offshore Energy - General | Tagged California, Gulf of America production, offshore oil, ONRR, Sable Offshore, Santa Ynez Unit | Leave a Comment »
Excerpts from BP press release:
Atlantis is located about 150 miles south of New Orleans and has been in production for nearly 20 years. The expansion project adds two new subsea water injection wells to help increase the pressure of targeted reservoirs, unlocking additional barrels and extending the producing life of one of bp’s flagship US offshore assets.
The project, which was delivered ahead of schedule and under budget, adds approximately 10,000 barrels of oil equivalent per day (boe/d) of gross peak annualized average production, with around 5,000 boe/d net to bp.
Some of you may remember the 2009 False Claims Act allegations by a former BP contractor claiming that BP did not properly maintain the engineer-approved “as built” drawings of systems and structures aboard the Atlantis facility. The contractor alleged that the absence of the documentation created increased safety risks for the facility and to its personnel.
Following the allegations, an industry source closely involved with the project (but not a BP employee) made the following comment to the BOE blog:
Atlantis was by far, in my opinion, the best of the bunch; proceeded as a normal construction project. The PMs were the best I’ve come across.
BOEMRE (the name of the offshore safety regulator at the time) conducted a comprehensive investigation of the matter. Director Michael Bromwich sumarized the findings:
“As the report makes clear, although we found significant problems with the way BP labeled and maintained its engineering drawings and related documents, we found the most serious allegations to be without merit, including the suggestion that a lack of adequate documentation created a serious safety risk on the Atlantic facility. We found no credible evidence to support that claim.”
The BOEMRE press release is attached. Link to the full investigation report.
In August 2014, a Federal court dismissed the False Claims Act lawsuit because the plaintiffs lacked evidence and standing.
Posted in Offshore Energy - General, Regulation, Gulf of Mexico | Tagged bp, BOEMRE, Atlantis, False Claims Act, expansion project | 2 Comments »
Bud's Offshore Energy (BOE) 