Bud's Offshore Energy (BOE)

The drilling business, particularly the deepwater sector, has never been for the faint of heart, and the past few years have included the added stresses of COVID, negative oil prices, anemic exploration activity, and offshore leasing “pauses.” Transocean nonetheless managed to build two 8th generation drillships, the Deepwater Atlas and Titan, both of which are slated to operate in the Gulf of Mexico.

The Atlas will begin drilling for Beacon Offshore Energy (unrelated to the BOE blog 😀) in the Shenandoah field (almost heaven?😀) later this year. The Titan is expected to begin drilling for Chevron next year. The rigs will be outfitted with 20,000 psi blowout prevention equipment and will be well-equipped for the growing number of high pressure prospects in the Gulf. Here is Transocean’s promotional video for the two rigs.

Both Beacon and Chevron fared well on our Gulf of Mexico scorecard. A bit of information about Beacon (BOE):

1. Wholly owned by funds managed by Blackstone Energy Partners.
2. CEO Scott Gutterman was previously the CEO of LLOG.
3. There are a number of related investment partnerships under the Beacon umbrella and they are often joint lease owners.
4. Per BOEM data, BOE has interest in 11 Gulf of Mexico leases.
5. The company has an excellent compliance record: 12 facility inspections (presumably all were drilling units) resulted in only 1 INC (violation).
6. Per BSEE, Beacon had 22 well starts since 2008. (Mystery: While the Blackstone and Beacon websites indicate that the company was formed in 2016, BSEE’s online borehole file shows 10 well starts prior to that year with the exact same company name. Presumably, the borehole file data are in error because BOEM data do not show any Beacon lease interest prior to 2018.)
7. Beacon bid on one tract in Lease Sale 257 (Nov. 2021) and was the sole bidder (sale was voided by DC Federal Court).
8. Beacon bid on 3 tracts in Sale 256 (Nov. 2020) and was the high bidder on one.
9. Beacon acquired interest in 2 leases in Sale 254 (March 2020), 7 in Sale 252 (March 2019), and 2 in Sale 251 (Aug. 2018)
10. In February 2022, Blackstone reportedly advised clients that they would no longer invest in oil and gas projects. Presumably, that doesn’t affect the Beacon operations (or perhaps the folks at Blackstone have come to their senses 😀).