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Archive for the ‘Offshore Energy – General’ Category

Drilling and Safety Management Rules Announced

Posted in accidents, Offshore Energy - General, Regulation, tagged , , , , , , , , , , on September 30, 2010| 2 Comments »

Today, BOEM released fact sheets describing the Drilling Safety and Safety and Environmental Management (SEMS) rules. The complete documents will be available for review as soon as they are published in the Federal Register.

Based on the fact sheet, the Drilling Safety Rule does not appear to include any significant surprises.  The rule seems to be generally consistent with the recommendations in Secretary Salazar’s 27 May Safety Measures Report to the President (the “30-Day Report”).  This is an Interim Final Rule that will be effective upon publication.

According to the fact sheet, the SEMS Rule will incorporate all elements of API RP 75 into BOEM regulations.  This is an improvement, in my opinion, from the proposed rule which incorporated only 4 elements of RP 75.  The effective date for this rule is not indicated in the fact sheet.

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BOEMRE Addresses “Idle Iron”

Posted in accidents, Offshore Energy - General, Regulation, tagged , , , , , on September 16, 2010| 1 Comment »

The Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE) has issued a Notice to Lessees and Operators (NTL) that specifies deadlines and other requirements for plugging and abandoning non-producing wells and removing platforms that no longer have utility. In my view, this regulatory action is necessary, appropriate, and consistent with authority provided in the Subpart Q (for quit :)) Decommissioning regulations. Post-hurricane experiences have demonstrated the enormous costs, operational challenges, and safety and environmental risks associated with plugging damaged wells and removing toppled platforms.

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How important is deepwater Gulf production? You be the judge.

Posted in Offshore Energy - General, oil, tagged , on July 10, 2010| 1 Comment »

  1. 80% of Gulf of Mexico oil production or a quarter of total US production is from leases in greater than 1000 feet of water.
  2. Per the EIA chart above, a single deepwater Gulf platform (Thunderhorse) surpasses all but four states in oil production.  3 deepwater platforms outproduce all but 3 states.
  3. Total oil production from deepwater facilities approximates that of the State of Texas.

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International Regulators’ Offshore Safety Conference, 18-20 October, Vancouver

Posted in conferences, IRF, Offshore Energy - General, Regulation, tagged , , , , , on June 8, 2010| Leave a Comment »

 

Vancouver, BC, Canada

 

The program for the International Regulators’ Offshore Safety Conference has been updated to include keynote presentations on the Montara and Macondo blowouts, and roundtable sessions that will address the lessons learned and how they should be applied by operators, contractors, and regulators.  The presentations, discussions, and debates are sure to be thought provoking and informative.  If you would like to participate, visit the conference website for more information.

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Will Other Nations Learn the Lessons from Montara?

Posted in accidents, Offshore Energy - General, Regulation, well control incidents, tagged , , , , , , on April 20, 2010| Leave a Comment »

My experience is that you unfortunately often need a major accident or even a disaster to engender political support for streamlining regulatory regimes.   Moreover, history shows that major accidents apparently must happen in your own jurisdiction to have such an effect on political support. Magne Ognedal

Magne’s astute comment repeatedly came to mind while I was reading the Montara testimony.  Our political systems are good at reacting, but are not so good at making tough decisions when the spotlight is elsewhere.  Crises provide the political capital needed to make major changes, but seldom yield the best solutions.

Will the Montara blowout provide the impetus needed for other countries to review and improve their offshore regulatory regimes?  These Montara issues should be of concern to all of us:

  1. Multiple regulators with unclear divisions of responsibility
  2. Regulatory gaps and overlap
  3. Ineffective use of standards and best practices
  4. Lack of clarity regarding operator and contractor responsibility and accountability
  5. Balancing goal-setting with prescription
  6. Monitoring operations effectively without taking “ownership”
  7. Applying regulatory resources efficiently and where the risk is greatest
  8. Absence of meaningful performance measures for operators and regulators
  9. Authority to remove rogue operators
  10. Ability to update standards and regulations in a timely manner
  11. Weaknesses in training programs for operators, contractors, and regulators

I’ll stop at ten (now eleven :)).

Many of these issues will be discussed at the International Regulators’ Offshore Safety Conference in Vancouver (18-20 October). I hope you plan to attend!

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Interview with Colin Leach

Posted in drilling, Interviews, Offshore Energy - General, well control incidents, tagged , , , on April 8, 2010| Leave a Comment »

Given the complicated situations that can occur, I think that the key is in understanding what can happen on a particular well, given the well geometry and rig specifics, such that communications with the crew are simple and focused.  The key is playing the “what if” games before a real incident occurs. ~ Colin Leach

In light of BOE’s interest in drilling safety, we thought we would ask a few questions to Colin Leach, a well control expert and a partner in Argonauta Energy Services.   Colin has over 26 years of upstream experience with an emphasis on deepwater drilling, and is internationally recognized for the depth and breadth of his understanding of drilling systems.  Read Colin’s insightful comments here.

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Someone Who Gets It

Posted in accidents, drilling, Offshore Energy - General, tagged , , , , , , , on April 5, 2010| Leave a Comment »

Mr Mueller likens the role of cementers in well construction to that of cornerbacks in football: “When we fall down and someone passes for a touchdown, everyone sees it. … When there’s a failure (in cementing), it’s typically quite noticeable and costly, even catastrophic. … You have to always ask yourself, ‘What haven’t I thought about? What can go wrong? If it does go wrong, how can we fix it?’ ”

In the wake of Montara, I recommend that you read an excellent article in the latest edition of Drilling Contractor magazine about Dan Mueller, a cementing specialist for ConocoPhillips.  Having read hundreds of pages about the cementing issues that appear to be the root-cause of the Montara blowout, it was refreshing to see Mr. Mueller’s comments and learn more about his company’s commitment to safe and effective cementing operations.  While incidents like Montara rightfully attract much of our attention, most companies understand the importance of cementing and provide the resources necessary to ensure success.  As the article reminds us:

The high stakes at play – plus the increasingly hostile conditions under which wells are drilled today – means that preplanning on a well-by-well basis is crucial. Thermal modeling, wellbore stress modeling, hydraulics modeling, computational dynamics modeling – everything that can be done has to be done to make sure nothing gets overlooked. In today’s complex wells, Mr Mueller explained, anything that’s an “unknown” has the potential to damage the cement’s effectiveness.

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President Obama’s Announcement – Very Encouraging

Posted in drilling, energy, gas, Offshore Energy - General, oil, tagged , , , on March 31, 2010| Leave a Comment »

Offshore Energy Awakening?

When you wake up after a long nap (in this case 25 years), you don’t just leap out of bed.  You first squint at the light, yawn, flex an arm, stretch your legs, and prepare to rise and actually do something.  The President’s decision to open a small slice of the Atlantic to  exploration and consider new areas in the Atlantic and Eastern Gulf of Mexico in the new 5- Year Program may seem modest, but it demonstrates that the nation is waking up to the importance of our offshore energy resources.  After 25 years of neglect, almost everyone agrees that US energy policy has been an economic and national security disaster.  More and more Americans are also recognizing that denying access to offshore resources is not in the best interest of the environment – regionally, nationally, and globally.

Some political leaders remain in dreamland as evidenced by the large blue areas in the map below.  When you have cried “wolf” about offshore drilling for your entire political career, you either believe what you have been preaching or are concerned about the political implications of changing your position.  However, demonizing offshore energy development is no longer a smart political strategy, and the views of these anti-energy stalwarts may finally be challenged, even in their own states and districts.

We operations, safety, pollution prevention, and regulatory professionals have to hold up our end.  Safety disasters or pollution spectaculars are not acceptable.  We need to examine our programs, operations, and incidents openly and honestly, and anticipate what might go wrong.  When an accident occurs, we need to learn what happened and why, and make sure it doesn’t happen again – anywhere in the world.

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Montara Hearings – Day 3 (Update)

Posted in accidents, oil, well control incidents, tagged , , , , , , , on March 17, 2010| Leave a Comment »

I want to suggest to you that the primary purpose of PCCs is actually to perform an anticorrosive function, particularly in relation to MLS systems that are subsurface of the sea – Tom Howe, Counsel for the Inquiry

-Mr. Howe made it clear that these caps are primarily for corrosion prevention, particularly in the case of mud line suspensions such as the Montara wells.  Regardless of their pressure containing capabilities, PCCs are difficult to test in situ and must be removed with the BOPE in place to avoid operating without a barrier.  Other highlights of the Day 3 testimony:

-Seadrill/Atlas engaged in a bit of damage control after implying yesterday that their OIM had lead responsibility for all operations at the facility.  In a response to a question from the Seadrill attorney, Mr. Gouldin (Seadrill) rephrased his position as follows:

In various parts of my evidence yesterday, there were issues that came up about the OIM having full responsibility, but he can only undertake that responsibility if he is given clear and full information and facts from the other parties involved in the operation.  He cannot operate in isolation. When I answered that the responsibility is there – yes, the responsibility is there to be transparent to him at all times in order to allow him to fully enact his duties. That’s what I meant in my response.

-In questioning Mr. Gouldin and Mr. Millar (Seadrill/Atlas), Mr. Howe clearly established that there was fluid influx following the cementing of the 9 5/8″ casing and that the response to this influx (injecting cement and fluid volumes greater than the influx) likely exacerbated the problem.

-Mr. Howe presented evidence that the the inhibited sea water that was left in the suspended well may not have been sufficiently weighted to over-balance the formation pressure in the reservoir

-Insufficient cement volumes may have facilitated gas migration during cementing.

-Senior PTTEP personnel were aware that the 13 3/8″ corrosion cap had not been installed.  Mr. Howe suggested that the cap may not have been installed because it was in poor condition.

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California Commentary – Part II: Slick Talk About Seeps

Posted in California, Offshore Energy - General, oil, seeps, tagged , , on March 11, 2010| Leave a Comment »

canoe caulked with asphaltum from natural seeps

The first consumers of petroleum used oil that seeped to the surface naturally.  Native Americans in California used petroleum seepage to caulk their canoes.  Marco Polo witnessed oil being recovered from seeps in 1264 in Baku (then part of Persia).

Drake Well, 1859, Titusville, PA

Natural seeps helped Colonel Drake target the first commercial oil well in the U.S. (Titusville, PA, 1859).  The amount of oil that seeps to the earth’s surface is surprisingly high.  In fact, a Norwegian Petroleum Directorate article on natural seeps estimates that “at least 1/3 of all oil formed below ground escapes to the surface as seepage.”

Natural seepage has increasingly factored into the offshore drilling debate.  The MMS Oil Spill Fact Sheet notes that “natural seeps introduce 150 times more oil into U.S. marine waters than do OCS oil and gas activities.” These data are intended to provide context, not to downplay the significance of drilling and production spills.  A large spill is an undesirable event at the location where it occurs,  regardless of how the spill’s volume compares with  regional, national, or international seepage totals.

Natural Seeps, Coal Oil Point

A California advocacy group, Stop Oil Seeps, has taken the “seep argument” a step farther by promoting  offshore production as a means of reducing natural seepage and the associated air and water pollution.

While SOS’s position is interesting and perhaps justified for areas like Coal Oil Point (Santa Barbara Channel),  not all production prevents or reduces seepage.  Offshore oil and gas seepage results when hydrocarbon-bearing formations are exposed to the sea floor either directly or via fractured or permeable overlying sediments.  Where such conditions do not exist, oil and gas production will not reduce seepage.  SOS’s enthusiastic support for California offshore production is refreshing, but advocates should exercise caution in making claims regarding seepage reduction.  Prospects for seepage reduction from offshore production range from highly likely (Platform Holly and Coal Oil Point) to highly unlikely (deep formations protected with impermeable cap rock).

While we applaud their enthusiastic support for offshore production, the SOS plan raises a number of questions:

  1. Is SOS suggesting that offshore production only be allowed if such production will reduce seepage?
  2. How much can offshore production reduce overall seepage in the region?  Is it cost-effective and feasible to achieve significant, long-term reductions in seepage that has existed for thousands of years?
  3. If the objective is to produce oil and gas, and generate the associated revenues, why not say that straight away?  Why is seep reduction necessary to justify responsible offshore production?
  4. Since the resources of the OCS are owned by all Americans, how does California justify “negotiating to retain the full fees and royalties for federal OCS leases and production revenue.”  Should Louisiana, Texas, Alaska, and other states also receive all fees and royalties for production from Federal waters?  Should these payments be retroactive?  Should states also receive all royalties and fees for wind and hydrokinetic energy produced in Federal waters?

While Platform Holly may be a negative spillage facility  (i.e. Holly’s seep reduction may significantly exceed the platform’s production spillage), this type of seepage reduction has not been demonstrated at other platforms.  Decisions on offshore exploration and development should be driven by the economic, energy security, and environmental benefits.  To the extent that production reduces natural seepage, all the better.  However, seepage reduction is not a primary reason for producing offshore oil and gas.

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