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Archive for the ‘Gulf of Mexico’ Category

Another achievement we should be applauding – first production from the Spruance Field

Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged , , , , , on June 30, 2022| Leave a Comment »

“The two-well subsea development is producing, in combination, approximately 16,000 barrels of oil per day and 13 million cubic feet of gas per day via a 14-mile subsea tieback to the EnVen-operated Lobster platform in EW 873. First production was achieved less than three years after the initial exploratory discovery well was drilled.” 

LLOG

The project owners (below) are all independent producers and private equity firms. Houston Energy, LLOG, Red Willow, EnVen, and Beacon were also among the high bidders in Lease Sale 257, which was vacated by a questionable court decision that the Federal government chose not to appeal.

The companies responsible for these important projects (see “simpler, safer, greener”) that have or will soon initiate production were also active bidders at Lease Sale 257. The absence of leasing has thus seriously handicapped the companies most responsible for the production surge to over 2 million BOPD in 2019 and for sustaining the current Gulf production rate of 1.7 million BOPD.

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BSEE Safety Alert addresses fall prevention issues

Posted in accidents, Gulf of Mexico, tagged , , , on June 29, 2022| Leave a Comment » 

Related posts: Falls are NOT trivial  and Important reading for offshore safety leaders
bsee-safety-alert-444-floorman-falls-from-derrick-ladderDownload

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Brief filed by 14 states in support of the Sale 257 appeal

Posted in climate, energy policy, Gulf of Mexico, Offshore Energy - General, tagged , , , on June 27, 2022| Leave a Comment »

Per their court filing, Montana, Alabama, Alaska, Arizona, Arkansas, Georgia, Kentucky, Mississippi, Missouri, Nebraska, Oklahoma, Texas, Utah, and West Virginia seek to protect oil and gas production in the Gulf of Mexico and throughout the United States. The States’ brief is rather political, which is not surprising given their support for offshore leasing and the apparent alignment of the Federal defendants and the plaintiffs in support of the decision by Judge Contreras to vacate the sale.

As was expected at the time of the ruling, the court decision on Sale 257 shut down offshore leasing for the remainder of the 2017-22 Five Year Plan. Secretary of the Interior Haaland has promised that a new proposed leasing plan will be released by 6/30/2022, but that is just the start of the lengthy planning process.

Interesting NEPA data from the States’ brief:

  • In 2018 CEQ found that, across the federal government, the average EIS completion time and issuance of a Record of Decision was over 4.5 years and the median was 3.6 years.
  • On average, Interior takes five years and the Department of Transportation 6.5 years to complete an EIS—and that’s not including the usual years of resulting litigation.
  • CEQ found that “across all Federal agencies, draft EISs averaged 586 pages in total, with a median document length of 403 pages.” As a result, “[t]he entire original purpose of doing NEPA analysis has been lost along the way to creating mountains of data and information in the hopes of successfully defending against inevitable litigation.”

Many thanks to the Texas AG for making the States’ brief readily available online. Unfortunately, that is not the case for the other briefs filed in support of the sale.

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Gulf of Mexico rig count unchanged

Posted in drilling, Gulf of Mexico, Offshore Energy - General, tagged , on June 24, 2022| Leave a Comment »

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Update on the Sale 257 appeal

Posted in climate, energy policy, Gulf of Mexico, Offshore Energy - General, tagged , , , on June 24, 2022| Leave a Comment »

Per a very good OGJ update, API, Louisiana, Chevron, bp, Shell, NOIA, the EnerGeo trade group of geophysical contractors, 14 states filing jointly, and the US Chamber of Commerce have submitted briefs to the US Court of Appeals for the District of Columbia Circuit.

Don’t expect a decision soon. The environmental advocacy groups are not scheduled to file their responses until Aug. 26, after which replies can be filed. No decision is expected before November at the earliest.

Previous posts and background information on Lease Sale 257.

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EIA short term production forecast for the Gulf of Mexico looks about right

Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged , , , , on June 23, 2022| Leave a Comment »

The EIA forecast looks about right. Production from new projects should offset existing field declines and maintain relatively stable volumes over the next 2-3 years. In the intermediate and longer terms we have problems given the dearth of exploratory drilling and new discoveries, and the complete absence of leasing.

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Will the proposed 5 Year Leasing Program (US offshore) be released by June 30? How many regions will have sales? Total number of sales?

Posted in Alaska, energy policy, Gulf of Mexico, Offshore Energy - General, tagged , , , , on June 22, 2022| Leave a Comment »

  • Secretary of the Interior Haaland committed to releasing the Proposed Program by June 30, 2022. Will that deadline be met? BOE’s guess is that the deadline will be met. However, the White House Climate Policy Office, which seems to control energy policy, may have other ideas.
  • Number of regions in which lease sales will be proposed: BOE thinks 2, the Gulf of Mexico and Alaska. There is no chance of >2. A GoM only proposed program is possible, but we doubt that Alaska will be eliminated at this early stage.
  • Number of lease sales proposed: BOE guesses a total of 7 sales, 5 in the GoM and 2 in Alaska. The “under” is probably a better bet than the “over,” unless they eschew area-wide GoM sales and propose an increased number of more targeted sales.

For comparison, the previous six 5-Year Programs have included 10-12 GoM sales (11.3 average), 1-8 Alaska sales (4.3 ave.), 0-1 Atlantic sales (0.3 ave.), and no Pacific sales.

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SPR update and the offshore leasing gap

Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged , , on June 21, 2022| Leave a Comment »

As of June, 2022
Bloomberg projection

Meanwhile, no new leases have been issued in Federal waters immediately offshore from the SPR sites (see map below) for 580 days, the longest leasing gap since 1958.

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Gulf of Mexico rig count back up to 15

Posted in drilling, Gulf of Mexico, Offshore Energy - General, tagged , on June 17, 2022| Leave a Comment »

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Inspector General reports on Gulf of Mexico flaring violator

Posted in energy policy, Gulf of Mexico, Offshore Energy - General, Regulation, tagged , , , , on June 16, 2022| Leave a Comment »

IG Report

We determined that over approximately 5 years, the energy company’s venting and flaring activities exceeded regulatory limits without the required approvals, resulting in a loss of Federal mineral royalties and resources. More specifically, we identified approximately 229,066 MCF of vented and flared natural gas as suspicious or exceeding the allowable amount across four platforms in the Gulf of Mexico between January 2014 and April 2020. We presented our findings to ONRR, which assisted us in analyzing the energy company’s venting and flaring activities and determining the amount of lost Federal mineral royalties. Based on this analysis, ONRR submitted and secured a proof of claim in the amount of $712,857.82 for unpaid mineral royalties during the energy company’s bankruptcy proceeding.

OIG report 6/13/2022

Comments:

  1. The report doesn’t name the company, but one can make an educated guess based on some of the information provided (e.g. number of platforms the company operated, bankruptcy proceedings, etc.)
  2. The regulator usually finds out about false or misleading recordkeeping. Reports from employees, anonymous or otherwise, are a common source of such charges, as was the case here. (In my District in California, a toolpusher informed us that BOP pressure test records were being falsified. This led to multiple felony convictions.)
  3. The IG’s recommendations to BSEE and ONRR are reasonable and appropriate:
    1. Examine venting and flaring reports for patterns that may reflect violations or amounts that exceed permissible limits.
    2. Develop a process to ensure that royalties are being paid for improperly flared or vented gas.
  4. As BOE has previously reported, available public flaring data do not match. These data inconsistencies should be addressed.
  5. BSEE/ONRR should make more detailed flaring/venting data publicly available so differences between facilities and sectors (e.g. deepwater vs. shelf) can be assessed. Efforts should also be made to post these data in a more timely manner. Data for 2021 are still not available.

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