Posted in Gulf of Mexico, hurricanes, Offshore Energy - General, tagged EIA, Gulf of Mexico, Hurricane Ida, oil production on November 30, 2021| Leave a Comment »
More than half of GoM oil production was shut-in for 13 days in September and several hundred thousand BOPD were shut-in for the rest of the month. The result was a 42% reduction in production from pre-Ida (July) levels.
All production has now been restored so the December EIA figures should give us a good read on stablized post-Ida production.
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, Regulation, tagged BOEM, BSEE, DOI, financial assurance, leasing report, royalty on November 29, 2021| Leave a Comment »
Observations and comments on the offshore findings and recommendations in the Dept. of the Interior’s report:
Posted in CCS, energy policy, Gulf of Mexico, Offshore Energy - General, tagged BOEM, CCS, infrastructure bill, Lease Sale 257 on November 24, 2021| Leave a Comment »
The text below, excerpted from the Infrastructure Bill (signed 2 days before Sale 257), requires the Federal government to provide funding for commercial CCS projects. $2.5 billion is appropriated. Given these incentives, how does BOEM possibly issue leases for CCS purposes when there was no public notice (as required by 30 CFR § 556.308) that CCS bids would be accepted at the oil and gas lease sale?
SEC. 40305. e) Large-scale Carbon Storage Commercialization Program.-- ``(1) In general.--The Secretary shall establish a commercialization program under which the Secretary shall provide funding for the development of new or expanded commercial large-scale carbon sequestration projects and associated carbon dioxide transport infrastructure, including funding for the feasibility,site characterization, permitting, and construction stages of project development. (h) Authorization of Appropriations.--There is authorized to be appropriated to the Secretary to carry out this section $2,500,000,000 for the period of fiscal years 2022 through 2026.
Posted in California, decommissioning, Gulf of Mexico, Offshore Energy - General, tagged Chevron, Lease 0450, Lease Sale 257, Lease Sale 53, Platform Hidalgo, Pt. Arguello Field on November 23, 2021| Leave a Comment »
Were it not for the surprising CCS bidding, which was accomplished without public notice, last week’s Gulf of Mexico sale would have been pretty ordinary – $177 million on 214 tracts.
A 1981 lease sale offshore California was quite another matter. That sale (no. 53) set records that will never be surpassed. A single lease (OCS-P 0450) encompassing a little more than 5000 acres was sold to Chevron and Phillips for an astounding $333 million. This equates to $1.013 billion in 2021 dollars. That single bid (in 1981 dollars) exceeds the total high bids for any Gulf of Mexico sale since 2015.
High bids for Sale 53 totaled $2.3 billion ($7.0 billion in 2021 dollars!) for only 81 tracts. A GoM sale in 2008 received $3.7 billion in high bids, but that was for 603 tracts.
Unfortunately, production from lease 0450 never met expectations. Platform Hidalgo (0450) and the other two Pt. Arguello field platforms (Harvest and Hermosa) are no longer producing and are in the process of being decommissioned. An interesting criminal case involving Platform Harvest, then operated by Texaco, will be discussed at a later date.
John Smith’s Pacific decommissioning update
Posted in CCS, energy policy, Gulf of Mexico, Offshore Energy - General, tagged CCS, Lease Sale 257 on November 19, 2021| Leave a Comment »
Posted in CCS, energy policy, Gulf of Mexico, Offshore Energy - General, tagged BOEM, CCS, Exxon, Lease Sale 257 on November 18, 2021| Leave a Comment »
Posted in CCS, energy policy, Gulf of Mexico, Offshore Energy - General, tagged CCS, Exxon, infrastructure bill, Lease Sale 257 on November 18, 2021| Leave a Comment »
Excerpt from SEC. 40307. GEOLOGIC CARBON SEQUESTRATION ON THE OUTER CONTINENTAL SHELF:
(b) Leases, Easements, or Rights-of-way for Energy and Related Purposes.--Section 8(p)(1) of the Outer Continental Shelf Lands Act (43 U.S.C. 1337(p)(1)) is amended--
(1) in subparagraph (C), by striking ``or'' after the semicolon;
(2) in subparagraph (D), by striking the period at the end and inserting ``; or''; and
(3) by adding at the end the following:
``(E) provide for, support, or are directly related to the injection of a carbon dioxide stream to sub-seabed geologic formations for the purpose of long-term carbon sequestration.''.
(c) Clarification.--A carbon dioxide stream injected for the purpose of carbon sequestration under subparagraph (E) of section 8(p)(1) of the Outer Continental Shelf Lands Act (43 U.S.C. 1337(p)(1)) shall not be considered to be material (as defined in section 3 of the Marine Protection, Research, and Sanctuaries Act of 1972 (33 U.S.C. 1402)) for purposes of that Act (33 U.S.C. 1401 et seq.).
(d) Regulations.--Not later than 1 year after the date of enactment of this Act, the Secretary of the Interior shall promulgate regulations to carry out the amendments made by this section.
This will be an interesting challenge for the DOI folks (BSEE/BOEM?) charged with writing the regulation given the jurisdictional issues related to capturing onshore CO2 and transporting it to the OCS. Also, when was this provision added to the infrastructure bill and did its apparent obscurity and delayed enactment give certain parties some type of competitive advantage at the sale?
Posted in Gulf of Mexico, Offshore Energy - General, tagged Exxon, Lease Sale 257 on November 17, 2021| Leave a Comment »
Absent Exxon’s surprise activity, this was a pretty typical sale of recent vintage: $177 million in high bids on 214 tracts. Even with all of the Exxon bids included, only tracts totaling 1.7 million acres received bids. (See previous post.)
Posted in Gulf of Mexico, Offshore Energy - General, tagged Gulf of Mexico, Lease Sale 257, oil and gas leases on November 17, 2021| Leave a Comment »
U.S. To Sell Area the Size of New Mexico For Offshore Drilling Just 5 Days After COP26
Newsweek
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged Lease Sale 257, White House on November 16, 2021| Leave a Comment »
Q Can I just ask one more on oil and gas? So, we just saw President Biden take action now in terms of the — protecting oil and gas development on Native lands and Tribal lands. But later this week, the U.S. government will open up for auction many, many acres — an area larger than several states, actually — to oil and gas leasing because of this legal situation.
So there are critics who say that you should have done more to avert this action. And I wonder if you can just say, you know, what action could potentially be done. Is there — are there any last-minute steps that could be taken to prevent those auctions from going forward?
MS. PSAKI: Well, you know, the President did — as you know, Andrea, but just to get others up to speed — issue an executive order pausing oil and gas leasing on public lands and in offshore waters to facilitate the identification and implementation of long-needed permitting and leasing reforms.
Shortly thereafter, the Interior Department cancelled the pending offshore oil and gas lease in the Gulf of Mexico known as Lease Sale 257.
So, what you’re referring to, I believe, is the fact that, in June, a federal district court in Louisiana stopped the President’s leasing pause and ruled that the Interior Department is legally required to go through with the sale of the Lease Sale 257, which is what you’re refer- — what Andrea is referring to in terms of putting up a bunch of lease sales — oil and gas lease sales.
We believe the decision is wrong, and the Justice Department is appealing it. So it’s in the courts; it’s in a legal process. We’re required to comply with the injunction. It’s a legal case and legal process, but it’s important for advocates and other people out there who are following this to understand that it’s not aligned with our view, the President’s policies, or the executive order that he signed.
Go ahead.
Q So there’s no more la- — so, you can’t take any last-minute action to prevent that from going forward?
MS. PSAKI: I would point you to the Justice Department. They, of course, are appealing this, and I would point you to them for any legal action or what their options are.
White House
Bud's Offshore Energy (BOE) 