I’m not typically aligned with the sponsors of the attached “Plug Offshore Wells Act,” but the call for transparency is understandable given that taxpayer funds are, for the first time, being used to decommission offshore platforms in the Matagorda Island area of the Gulf of Mexico, massive liabilities associated with the Cox bankruptcy loom, and the Hogan and Houchin saga drags on without resolution.
The bill would require an annual report on well, platform, and pipeline decommissioning including applications, deadlines, and enforcement actions. BSEE does have a good facility infrastructure page for the GoM, but much of the information called for in H.R. 9168 is not publicly available.
Crews from the U.S. Coast Guard, Texas General Land Office, and the Texas Railroad Commission monitored the operation. It’s unclear who the responsible party is and who funded and performed the work.
Comments on the 3 risk reduction factors cited in the letter:
Factor 1: Those “robust insurance policies” may soon be tested given the costs associated with the turbine blade incident and potential law suits. (The notice pasted below informs that Nantucket officials will meet on Tuesday to consider litigation. A question for attorneys is the extent to which Nantucket is compromised by their good “Good Neighbor Agreement” with Vineyard Wind. That agreement essentially calls on Nantucket to promote the Vineyard Wind projects in return for payments that seem modest relative to the economic benefits from tourism and fishing.)
Factor 2: To the extent that GE Vernova Haliade-X 13 megawatt turbines are proven technology (and that is very much in doubt), the use of proven technology doesn’t prevent premature abandonment associated with unexpected incidents.
Factor 3: Reliable power generation and predictable long-term income remain to be demonstrated.
This is yet another example of the importance of proper well plugging, platform removal, and decommissioning financial assurance. It’s noteworthy that Texas is among the states suing to block BOEM’s financial assurance rule for Federal waters.A serious collaborative Federal, State, and industry effort to address decommissioning issues is long, long overdue.
8 miles offshore Galveston County (TX State waters extend 3 marine leagues/9 nautical miles/10.35 statue miles offshore)
flowline riser leaking natural gas and condensate (badly corroded platform)
no recoverable oil
abandoned platform
additional research is needed to fully determine ownership of the leak source (???)
HIGH ISLAND BLOCK 98-L INCIDENT :
The Texas General Land Office (GLO) is sharing the following information:
On Sunday, July 14, 2024, at 8:00 pm, the Oil Spill La Porte Office Response Officer received notification of a natural gas/oil discharge off the coast of Crystal Beach, Galveston County. The spill was reported to be from a platform in High Island Block 98-L, about eight miles offshore in the Gulf of Mexico. Oil Spill personnel traveled via response boat to investigate on Monday morning and determined the discharge to be from a flowline riser leaking natural gas and condensate. Although the leak can be seen from the water, no recoverable oil was visible. The platform is abandoned, as defined by the Texas Railroad Commission, placing it within the Railroad Commission’s statutory authority for administration. The wells are not covered as part of the GLO’s current well plugging MOU with the Railroad Commission. The platform and associated wells are documented in the Oil Spill program’s abandoned well listings.
On Wednesday, July 17, La Porte office staff, with US Coast Guard and Railroad Commission personnel, inspected the platform area again. The leak is still present but has not increased. Railroad Commission staff stated that additional research is needed to fully determine ownership of the leak source.
The Coast Guard reports receiving a call from Channel 2-KPRC (NBC) in Houston regarding the leak and also seeing social media posts by a local area fishing group.
At this time: No injuries reported, No impact to commerce, No impact to wildlife.
Some of us remember the Brent Spar saga (1995). The subsequent Brent field decommissioning activities have been less controversial, including the removal of the Brent C topsides on July 9. The Allseas single lift technology is most impressive. Check out the video!
BOEM’s land rush approach to offshore wind leasing will add up to 1086 turbine towers and 28 offshore substations (OSSs) in the Atlantic just from active projects with approved Records of Decision (RODs). (See the table below.) Another 17 active Atlantic commercial projects have yet to reach the ROD stage. Those projects should increase the total number of structures to >3000. Five more Atlantic wind lease sales are scheduled.
project
turbine towers
offshore substations
Coastal VA Offshore Wind
202
3
Revolution Wind
100
2
Sunrise Wind
94
1
Atlantic Shores South
200
up to 10
Ocean Wind 1
98
up to 3
Vineyard Wind 1
100
2
Empire Wind 1 & 2
147
2
New England Wind (phases 1&2)
150
5
Per the Construction and Operations Plan (COP) for Vineyard Wind, the topsides for a conventional electrical service platform (ESP) (also known as an offshore substation or OSS) are 45 x 70 x 38 m, which is larger in surface area than a typical 6-pile oil and gas platform (~30 x 30 m), and is comparable in size to a large jackup drilling rig.
The Atlantic Shores plan calls for 10 small, 5 medium, or 4 large OSSs. (Uncertainty regarding the number and types of structures seems rather common in wind COPs.) The large OSSs have topsides that are 90 m by 50 m and rise to 63 m above MLLW. These are large offshore structures whether for wind or oil and gas.
Per BOEM, the “Rule to Streamline and Modernize Offshore Renewable Energy Development” is intended to “make offshore renewable energy development more efficient, [and] save billions of dollars. Unfortunately, the savings associated with relaxed financial assurance requirements translates to increased risk for power customers and taxpayers.
BOEM signaled their intentions on offshore wind (OSW) decommissioning three years ago when they granted a precedent setting financial assurance waiver to Vineyard Wind. Despite compelling concerns raised by commenters, the “streamlining” regulations codified this decision.
No one knows what the financial future will be for wind projects and the responsible companies. Financial assurance should therefore be established when the structures are installed, not years into the future as allowed by the revised regulations. What leverage will BOEM have then?
Nordsee One substation, Germany. Rystad Energy projects 137 new power substations offshore continental Europe this decade, requiring $20 billion in total investment.
The limited media coverage of the lawsuit originated from a single Reuters article. Apparently Reuters learned about the suit and reached out to the litigants. Their article quoted Louisiana Attorney General Liz Murrill as follows:
“This is a really egregious direct assault on intermediate level producers of oil and gas, and that affects a lot of business in our state,” Murrill told Reuters in an interview.
That quote is all we have from the AGs. Why the absence of announcements:
Interest in working with industry and the Federal govt to seek policy solutions that best address OCS decommissioning issues? (This would be encouraging.)
State of Louisiana, Louisiana Oil & Gas Association, State of Mississippi, State of Texas, Gulf Energy Alliance, Independent Petroleum Association of America and U S Oil & Gas Association
Defendant:
Deb Haaland, U S Dept of Interior, Bureau of Ocean Energy Management, Elizabeth Klein, Steve Feldgus and James Kendall
Case Number:
2:2024cv00820
Filed:
June 17, 2024
Court:
US District Court for the Western District of Louisiana
Presiding Judge:
James D Cain
Referring Judge:
Thomas P LeBlanc
Nature of Suit:
Other Statutes: Administrative Procedures Act/Review or Appeal of Agency Decision
Cause of Action:
28 U.S.C. § 2201 Constitutionality of State Statute(s)
“In the 1950s, Soviet engineers built a massive city in the Caspian Sea off the coast of Azerbaijan. It was a network of oil platforms linked by hundreds of kilometers of roads and housing 5,000 workers, with a cinema, a park and apartment blocks. Gradually disintegrating but still closely guarded, this astonishing place inspired a fiery scene in a James Bond movie.“
Neft Dashlari (Black Rock), as the town is known, is no doubt the most unique oil town in history – the oil patch’s Venice! 😉
“In Neft Dashlari’s heyday, some 2,000 drilling platforms were spread in a 30-kilometer circle, joined by a network of bridge viaducts spanning 300 kilometers. Trucks thundered across the bridges and eight-story apartment blocks were built for the 5,000 workers who sometimes spent weeks on Neft Dashlari. The voyage back to the mainland could take anything between six and twelve hours, depending on the type of ship. The island had its own beverage factory, soccer pitch, library, bakery, laundry, 300-seat cinema, bathhouse, vegetable garden and even a tree-lined park for which the soil was brought from the mainland.“
Decommissioning lesson: “Dismantling Neft Dashlari properly would probably be more expensive than simply keeping it going with a scaled-down oil production.” Sound familiar?
Bud's Offshore Energy (BOE) 