WSJ article on Sable Offshore:
“Oil giants have fled California, but James Flores is desperate to get in, even if it means crossing swords with the state.”
Archive for November, 2025
WSJ: “The Texas Oil Mogul at War With California Over an Offshore Bounty”
Posted in California, Offshore Energy - General, tagged California, Jim Flores, Refugio pipeline spill, Sable Offshore, Santa Ynez Unit, WSJ on November 29, 2025| Leave a Comment »
On Thanksgiving
Posted in Canada, energy policy, Offshore Energy - General, Regulation, Uncategorized, tagged energy policy, offshore energy, Thanksgiving on November 27, 2025| Leave a Comment »
On my favorite holiday, I’m sending best wishes to BOE readers of all persuasions. Offshore energy issues can be divisive, even among friends, and I’m grateful for the opportunity to share information and opinions.
My wife and I will be spending Thanksgiving with my daughter’s family including our 6 grandchildren, none of whom have expressed interest in being offshore safety regulators (no higher calling 😉).
Belated holiday wishes to our friends in Canada where Thanksgiving is celebrated in October, and cheers to those living where a similar fall holiday is observed.
Bud
Will bearish oil price forecasts constrain bidding at Gulf lease sale?
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged BBG1, deepwater development, Gulf of America, JPMorgan, oil and gas lease sale, oil price forecast on November 26, 2025| Leave a Comment »
In JPMorgan’s view, the stage is set for a potential decline of as much as 50% in oil prices through the end of 2027, taking Brent crude down to the low $30s per barrel range from its current level of around $63.50.
Will bearish forecasts by JPMorgan and others temper bidding at the highly anticipated, and long awaited, Gulf lease sale to be held on 12/10/2025? Probably not for these reasons:
- This will be the first lease sale in 2 years.
- The terms are very attractive.
- Given the longer term nature of deepwater development, production will not begin for years following lease issuance. Note that anticipated first production for 3 new high-pressure deepwater projects, Kaskida, Sparta, and Tiber, will be 23, 16, and 21 years after the field discovery dates.
- To the extent that price forecasts are reliable at all (see no. 9 in the image below), the degree of uncertainty for longer term forecasts is particularly high.
- The sale has to live up to its name Big Beautiful Gulf 1 (BBG1). 😉
Improved wind safety? Not so fast says former Ørsted safety chief!
Posted in accidents, energy policy, Offshore Energy - General, Offshore Wind, tagged Eskild Lund Sorensen, G+ incident report, Offshore Wind, wind safety on November 25, 2025| Leave a Comment »
“So, the safety culture is fine because we don’t report when people die.” Former Ørsted safety head, Eskild Lund Sørensen, accuses offshore wind body G+ of cherry picking data. The 2024 G+ incident data report is attached.
Member companies, which include major players such as Ørsted, Equinor, Vattenfall, RWE, and CIP, report quarterly data on accidents, near-misses, hazardous observations, and equipment damage. As is the case with most industry reporting schemes, anonymity is prioritized over transparency.
Sørensen asserts that the G+ wind industry data are incomplete: ”It shows that what is reported under the guidelines has gone down, and also that there is a cut off on what is being reported that does not include the full value chain on the industry.” He notes that a contractor to Northland Power from Canada, a member of G+, was involved in a 2024 workplace accident in Taiwan that resulted in three fatalities. (It’s also noteworthy that Equinor’s 2024 Empire Wind fatality was not included.)
Sørensen: ”There have been no significant improvements in the last 10 years. Safety in offshore wind is neither getting worse nor better. There are no signs of that.”
”I’m speaking up because we owe people the truth. If we’re not honest about the actual safety conditions in offshore wind, we can’t change them. Misinformation about workplace safety creates a dangerous illusion that everything is “under control”, while too many people are getting hurt. But when we dare to speak about reality as it is, we create the foundation for a safer, faster, and truly sustainable energy transition,” Sørensen says.
”And then it becomes difficult to learn if you have to wait for something to go through 57 gates and down past legal,” he says. (Sound familiar?)
In the U.S., both industry and govt need to do a better job of sharing complete incident data in a timely manner.
Lucky again in 2025; no tropical storm shut-ins for the 2nd time in 3 years!
Posted in Gulf of Mexico, hurricanes, Offshore Energy - General, tagged 2025 hurricane season, Charles Smith, Gulf of America, Hurricane Andrew, platform shut-ins, tropical storms on November 24, 2025| Leave a Comment »
As was the case in 2023, there were no tropical storm production shut-ins in the Gulf in 2025. Per the chart below derived from BSEE data, only 4 tropical storms caused platform shut-ins in the past 5 years. This lull followed a 6-storm year in 2020.
The Minerals Management Service Technology Assessment and Research Program began closely studying hurricane damage to offshore facilities following Hurricane Andrew in 1992. Dr. Charles Smith was a leader in these efforts. Attached is a comprehensive study report on Andrew’s effects on offshore platforms. Three background paragraphs are pasted below.
Florida buffer: 100-mile proposed vs. the current 125 mile buffer
Posted in Offshore Energy - General, Florida, Gulf of Mexico, energy policy, tagged Draft Proposed OCS Leasing Program, Florida buffer, Ron DeSantis, Florida delegation, 100 miles vs. 125 miles, Trump 2020 withdrawal, GOMESA on November 21, 2025| Leave a Comment »
A specific description of the proposed Florida buffer in the Eastern Gulf is found in a footnote on page five of the Draft Proposed Program (DPP):
2 Includes a 100-mile coastal buffer off the coast of Florida and the area eastward of a line extending south from a point approximately 25 miles west of Tallahassee, Florida.
The 100 mile buffer seems like a reasonable proposal that minimizes the risk of coastal impacts without significantly reducing the oil and gas resource potential. However, the 125 mile buffer established in the Gulf of Mexico Security Act (2006) and the 2020 Trump withdrawal (see the comparison above) has become sacrosanct, and Gov. DeSantis and the Florida delegation oppose any change:
Unfortunately, the additional 25 miles is thought to eliminate much of the oil and gas resource potential:
The Draft Proposed Leasing Program has been published!
Posted in Alaska, California, energy policy, Gulf of Mexico, Offshore Energy - General, Uncategorized, tagged Alaska, California, Draft Proposed OCS Leasing Program, Florida, Gulf of America on November 20, 2025| 2 Comments »
The press release and full program are linked. It looks like the most recent leaks were accurate. See the maps below with the locations and dates. This will stir the pot!
Root cause of the Santa Ynez Unit woes
Posted in accidents, California, Offshore Energy - General, oil spill response, pipelines, tagged Plains, Refugio pipeline spill, Santa Barbara, Santa Ynez Unit on November 20, 2025| Leave a Comment »
We can scream all we want (with some justification) about the California Coastal Commission, Santa Barbara County, and intractable environmental organizations, but the Santa Ynez Unit would still be producing today were it not for an ugly, preventable pipeline spill.
At approximately 10:55 a.m. Pacific Daylight Time (PDT) on May 19, 2015, the Plains Pipeline, LP (Plains), Line 901 pipeline in Santa Barbara County, CA, ruptured, resulting in the release of approximately 2,934 barrels (bbl) of heavy crude oil. An estimated 500 bbl of crude oil entered the Pacific Ocean.
1) Ineffective protection against external corrosion of the pipeline
The condition of the pipeline’s coating and insulation system fostered an environment that led to the external corrosion.
The pipeline’s cathodic protection (CP) system was not effective in preventing corrosion from occurring beneath the pipeline’s coating/insulation system.
2) Failure by Plains to detect and mitigate the corrosion
The in-line inspection (ILI) tool and subsequent analysis of ILI data did not characterize the extent and depth of the external corrosion accurately.
3) Lack of timely detection of and response to the rupture
The pipeline supervisory control and data acquisition (SCADA) system did not have safety-related alarms established at values sufficient to alert the control room staff to the release at this location.
Control room staff did not detect the abnormal conditions in regards to the release as they occurred. This resulted in a delayed shutdown of the pipeline.
The pipeline controller restarted the Line 901 pipeline after the release occurred.
The pipeline’s leak detection system lacked instrumentation and associated calculations to monitor line pack (the total volume of liquid present in a pipeline section) along all portions of the pipeline when it was operating or shut down.
Control room staff training lacked formalized and succinct requirements, including emergency shutdown and leak detection system functions such as alarms.
Plains Pipeline was the responsible party, but that doesn’t absolve the companies that were dependent on Plains to transport their production. Given the organized opposition that emerged following the Santa Barbara blowout in 1969 (the result of a reckless well plan), the integrity of that pipeline was critical to their business strategy and they should have exercised some oversight.
Offshore disasters have had enormous consequences for the oil and gas industry in terms of lost opportunities. Think about this: prior to the Macondo blowout, the Obama administration had proposed an oil and gas lease sale in the Atlantic and the Florida Senate was holding hearings about leasing in Florida State waters. Such lease sales are now completely out of the question.
Regulations and standards are not enough. We need open discussion about incidents, large and small, and a willingness to be critical of the responsible parties.
Stunning Hunterbrook report suggests the end is near for Sable Offshore
Posted in California, decommissioning, Offshore Energy - General, tagged decommissioning, financial responsibility, Hunterbrook, Sable Offshore, Santa Barbara County, Santa Ynez Unit, Steve Lavagnino on November 19, 2025| Leave a Comment »
Excerpts from a stunning Sable update issued by Hunterbrook Media LLC (“Hunterbrook“) on November 14, 2025:
- SEC filing reveals Sable entered October about a month from potential bankruptcy. The company had $41.6 million as of September 30, with $39.7 million in average monthly burn in 3Q25.
- When Sable announced its $250 million financing on November 10 at $5.50 per share, the company likely had single digit millions in the bank based on its reported burn, against over $163 million in accounts payable and accrued liabilities. Sable does not generate any revenue.
- Sable needs to raise significantly more money: According to leaked audio of Sable’s CEO briefing for select investors, the company will require $2.3 billion to achieve commercial production of oil and gas from its three platforms off the coast of Santa Barbara.
- That includes at least $900 million to buy out Exxon, to which Sable must pay 15% interest on debt due by March 31, 2027. By then, the loan would be about $1.1 billion, accruing $200 million in added debt.
- One of Sable’s only known assets other than the oil and gas project is a private plane the company purchased from its CEO, Jim Flores. The plane recently flew round-trip from Houston, where Flores lives, to Louisiana, in time for a football game at the CEO’s alma mater.
Comments from Santa Barbara County Supervisor Steve Lavagnino, an oil industry supporter, that explain his opposition to the transfer of Exxon’s pipeline permit to Sable:
“The final straw for me was a Hunterbrook article, which was as disturbing as anything I’ve read. I have many friends in the oil industry and I will continue to support efforts to access our natural resources, but it has to be done responsibly by operators who put safety above profits.”
Sable’s limited response to the Hunterbrook report includes information on decommissioning financial assurance:
- Sable’s original SYU Purchase and Sales Agreement (PSA) with Exxon required Sable to post a $350 million decommissioning bond “150 days following the resumption of production from the wells.”
- According to Sable, production resumed on May 15, 2025. The bond would have thus been required in October. (SYU production was halted by court order on June 6, so that “resumption date” may be irrelevant. Regardless, the Oct. financial assurance deadline is immaterial given the recent update to the PSA.)
- The PSA update extended the date for posting the decommissioning bond to three business days following the new Exxon Loan Maturity Date of March 31, 2027 or 90 days after first sales of hydrocarbons, whichever comes first. (Note the change in language from “resumption of production” to “first sales.” Brief well test production does not trigger posting of the decommissioning bond.)
- Under certain circumstances after the bonding is in place Exxon may seek an increase in the bonding amount to $500 million.
The decommissioning obligations are moot if Sable runs out of funds or is unable to resume SYU production prior to the 3/31/2027 PSA deadline. Exxon would remain fully responsible for SYU decommissioning.
Is it time for a public statement from Exxon on the SYU and Sable?
How effectively does the Center for Offshore Safety measure industry performance?
Posted in accidents, Gulf of Mexico, Offshore Energy - General, tagged Center for Offshore Safety, Cox Operating, Deepwater Horizon, drilling, fatalities, Fieldwood Energy, incident data, incident reporting, offshore industry performance, SEMS on November 18, 2025| Leave a Comment »
The Center for Offshore Safety (COS) was established in response to a recommendation by the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling for improved self-regulation by the offshore industry. The Commission supported the creation of a non-profit, industry-funded organization similar to the Institute of Nuclear Power Operations, to promote the highest levels of safety and operational excellence.
The COS has been effective in strengthening corporate Safety and Environmental Management Systems, influencing the industry’s safety culture, and sharing best practices and lessons learned. These are important accomplishments.
The COS has fallen short in gathering the data needed to assess the offshore industry’s safety performance. As is the case with most voluntary reporting programs, data completeness and accuracy issues limit the significance of COS performance reviews.
Observations regarding the most recent COS Offshore Safety Performance Report follow:
- The COS uses accepted performance indicators and a logical classification scheme.
- COS reports that their members accounted for 78% of OCS oil and gas activity in 2024. This is accurate when cross-checked with BSEE hours worked data. However, the % of hours worked is not a good measure of the % of incidents reported in any category.
- Companies not participating included important operators like LLOG, Cantium, Walter, and W&T, a host of smaller Gulf independents, the 2024 violations leader (by a wide margin) Cox, and troubled Fieldwood. (See Fieldwood’s 2021 and 2022 performance.)
- Only two drilling contractors – Helmerich & Payne and Valaris – are members. Major contractors like Noble, Transocean, and Seadrill are not members. Their incidents will thus not be reported if they are not working for a COS member.
- No production contractors are COS members. These companies conduct most of the platform operations on the shelf, where many of the lease operators are not COS members.
- Pacific and Alaska Region operators do not participate.
- Looking only at fatalities (table below), the most important and easily verified incident category, there are troubling omissions:
- COS reports no 2024 fatalities when in fact there was a fatality during an operation for a COS member.
- COS reports no 2022 fatalities when there were actually five. A workover incident took the life of one worker, and four died in a helideck crash on an OCS platform. In both cases, the facility operator was a non-member company.
- COS records one 2021 fatality, but fails to include a 2021 Fieldwood fatality. There were also 6 “non-occupational” fatalities on OCS facilities in 2021, as classified by BSEE. Given the importance of worker health (the H in HSE), such a high number of non-occupational fatalities should be of interest industry-wide.
- The COS report includes only two of the six 2020 fatalities, 2 of which were classified by BSEE as non-occupational.
- The bottom line is that COS accounted for only 3 of 12 (25%) occupational fatalities during the 2020-24 period. There were at least 20 fatalities if you include the non-occupational incidents.
| fatalities per COS | occupational fatalities (from BSEE data) | non-occupational fatalities (from BSEE data) | |
| 2024 | 0 | 1 | ? |
| 2023 | 0 | 0 | ? |
| 2022 | 0 | 5 | ? |
| 2021 | 1 | 2 | 6 |
| 2020 | 2 | 4 | 2 |
The offshore industry is only as good as its worst performer, so complete participation is essential. Voluntary reporting is seldom complete reporting, because some companies are more concerned about confidentiality than completeness and information sharing.
For industry reporting programs to be comprehensive and credible:
- The entity receiving the reports and managing the data must be independent and not affiliated with an industry advocacy organization.
- All operating companies must participate and complete reporting must be required. This can be accomplished contractually. If necessary, the regulator can require participation (either as a separate regulation or as a SEMS element).
- Company incident submittals should be audited by the independent entity.
- Fees should be solely for the purpose of supporting the independent reporting system.
- For SP1 and SP2 incidents (per the COS classification scheme), the names of the responsible companies should be included in the performance reports. The current COS system prioritizes confidentiality over accountabiity and information sharing.
Bud's Offshore Energy (BOE) 