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Archive for the ‘Offshore Energy – General’ Category

Stemming the decline in deepwater Gulf of Mexico exploration?

Posted in Gulf of Mexico, Offshore Energy - General, tagged , , , , , , , , , , , on November 18, 2022| Leave a Comment »

Was 2021 the low point? Hopefully that is the case, but consistent leasing is essential.

Looks like Woodside is now officially the GoM operator of record (was BHP prior to merger). Kudos to them.

Shell continues to be the GoM bellwether. There is no OCS program without them.

What’s up with BP and Chevron? Big declines from both.

US super-majors Exxon and ConocoPhillips remain out of the picture, both in terms of lease acquisition and exploration. Disappointing.

Tip of the hat to Hess, LLOG, Murphy, and Talos – independents committed to deepwater production.

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Nord Stream explosives confirmed

Posted in energy, Offshore Energy - General, pipelines, Russia, tagged , , on November 18, 2022| Leave a Comment »

Sweden’s prosecutor’s office said Friday that an investigation into gas leaks from two underwater pipelines connecting Russia to Germany found traces of explosives, confirming that it is a case of “serious sabotage.”

CNBC

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RIP Mike Conner, deepwater safety leader

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

On Monday, the offshore world lost Mike Conner, an outstanding engineer and a major contributor to the success of the US offshore program.

Mike is the person most responsible for the Deepwater Operations Plan (DWOP), a pioneering safety-case approach to regulating deepwater oil and gas development. The DWOP program was initiated 30 years ago and facilitated deepwater production at a time when there were no deepwater-specific regulations or standards. Innovative tension leg platform, compliant tower, spar, production semisubmersible, and subsea projects would not have been possible without the DWOP program. 93% of Gulf of Mexico oil production and 76% of the gas is now attributable to deepwater production facilities. Thanks in large part to the DWOP program, these facilities have had a nearly flawless safety and environmental record.

While his obituary is no yet available, this link announces Mike’s well-deserved selection for the OTC Heritage Award in 2017, and provides good information on Mike and his career.

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2021 Flaring Intensity – 10 largest flaring nations vs. US Gulf of Mexico

Posted in climate, flaring and venting, Gulf of Mexico, Offshore Energy - General, tagged , , , on November 15, 2022| Leave a Comment »

Using the World Bank’s worldwide flaring data and ONRR flaring and venting data for the GoM, I compared GoM flaring intensity for 2021 with that of the World Bank’s top ten flaring nations. This is just one example of why US offshore production is a preferred and vital component of our energy mix.

Further discussion: Kudos to the World Bank for their use of satellite data to estimate flaring volumes worldwide. Their primary performance indicator is flaring intensity (volume flared per bbl of oil produced). Absent better worldwide reporting regimes, satellite data are essential. However, there are issues with the World Bank’s system that merit further consideration:

  • Satellites miss some flares and vented gas (a more significant GHG concern) is not detected
  • A prior review of Gulf of Mexico data indicated that the World Bank flaring estimates are low.
  • The flaring intensity indicator penalizes higher gas-oil ratio (GOR) wells. Production upsets of the same duration yield higher flaring intensity scores at higher GOR facilities.
  • Associated gas is an environmentally favorable energy source that should not be discouraged. Most Gulf of Mexico gas production is now from oil wells. Efficient collection and utilization is the key.
  • There will always be some production upsets that result in flaring. The objective should be to minimize the % of oil-well and gas-well gas that is flared, irrespective of the amount of oil production. See the recent GoM summary data posted here and here.

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Comments on revisions to BSEE’s Well Control Rule

Posted in Offshore Energy - General, Regulation, well control incidents, tagged , , on November 10, 2022| Leave a Comment »

Comments on the proposed revisions to BSEE’s Well Control Rule are due on Monday (11/14/2022). My comments were submitted yesterday, and I have attached a copy for those who might be interested. Bud

wcr-comments-2Download

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Is Israel (plus Cyprus and Lebanon) the Guyana of natural gas?

Posted in energy policy, Guyana, Offshore Energy - General, pipelines, tagged , , , , on November 9, 2022| Leave a Comment »

100+ tcf and the discoveries keep coming. Here’s the latest:

London, 7 November 2022 – Energean plc is pleased to announce that i) the Zeus 01 exploration well has made a commercial gas discovery of 13 bcm ii) contingent resources at Athena have been upgraded following post-well analysis; and iii) the Stena IceMax drilling rig has moved to block 23 to drill the Hercules structure, the final well in Energean’s 2022 drilling campaign.

Will the gas/power transmission systems follow?

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Another chapter in the Santa Ynez Unit saga

Posted in California, decommissioning, Offshore Energy - General, tagged , , on November 8, 2022| Leave a Comment »

HOUSTON, Nov 6 (Reuters) – Exxon Mobil Corp will take up to a $2 billion loss on the highly leveraged sale of a troubled California offshore oil and gas field that have been idled since a 2015 pipeline spill.

Sable Offshore, a blank check company founded by industry veteran James Flores, will borrow 97% of the $643 million purchase price from Exxon under a five-year loan. Blank check companies raise money to acquire operating businesses. If Flores fails to restart production at the Santa Ynez field by the start of 2026, Exxon could take back the entire operation, Sable disclosed in a filing.Flores will seek permits to restart Santa Ynez and expects to pump about 28,100 barrels of oil and gas per day beginning in 2024, according to a Sable investor presentation. The field has 112 wells and the potential for at least another 100 wells, its presentation showed.

Jim Flores is well known in the offshore industry dating back to his days as CEO of Flores & Rucks, a Gulf of Mexico exploration and production company, in the 1990’s.

And Exxon is no doubt still on the hook for decommissioning these massive platforms.

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BSEE’s decommissioning notice has been posted

Posted in decommissioning, Gulf of Mexico, Offshore Energy - General, Regulation, tagged , , , on November 8, 2022| Leave a Comment »

BSEE’s temporary abandonment/decommissioning solicitation has been posted. Some details:

  • 14 wells to be decommissioned
  • 1 well to be checked to confirm temporary abandonment
  • Well depths: 2359′ to 11934′
  • Water depths: 70′ to 477′
  • 11 gas wells, 3 oil wells
  • Well completion dates: 2006-2008
  • Last production: 2010-2013 (Presumably, the short productive life of these wells either contributed to or was because of the lessees’ bankruptcies.)
  • $25,000😀 minimum to $100,000,000 maximum contract guarantee

If I was an offshore contractor, I wouldn’t touch this work without:

  1. Ironclad liability protection after the work is completed and inspected. A contractor should not inherit the perpetual liability that the lessees knowingly and willfully accepted when they purchased the leases and conducted operations; nor is the contractor responsible for the failure of industry and government to establish a financial assurance framework that protects the taxpayer from such liabilities.
  2. Protection against likely cost overruns related to the uncertain downhole condition of the wells.

Previous posts on this matter:

Taxpayer funded decommissioning – troubling precedent for the US offshore program

NOT a shining moment for the offshore industry

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The international climate agenda does not supersede the OCS Lands Act

Posted in climate, energy policy, Offshore Energy - General, tagged , , , on November 7, 2022| Leave a Comment »

Netherlands climate activist Niklas Hohne succinctly summarizes the “end of fossil fuels” strategy (first quote) that the US Department of the Interior seems intent on implementing in the proposed 5 Year OCS Leasing Plan (second quote). What is DOI’s legislative authority for phasing out offshore oil and gas production? It’s certainly not the OCS Lands Act which calls for the expeditious and orderly development of OCS resources. Neither the EIA nor any other reputable forecaster believes we can even reduce, let alone eliminate, oil and gas consumption in the next 20-30 years.

“The plan was not to build any new infrastructure, because everything new you build has to run for 20 or 30 years to pencil out, long past the point we want to be off fossil fuels,” Hohne said. 

Niklas Hohne, founder of the New Climate Institute (Netherlands) to the Washington Post

“The long-term nature of OCS oil and gas development, such that production on a lease can continue for decades makes consideration of future climate pathways relevant to the Secretary’s determinations with respect to how the OCS leasing program best meets the Nation’s energy needs.“

5 Year Leasing Program, p.3

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Total GoM gas flared/vented vs. total gas production

Posted in climate, energy policy, gas, Gulf of Mexico, Offshore Energy - General, tagged , , , on November 4, 2022| Leave a Comment »

Further, per the ONRR data:

Oil-Well Gas
Produced
(BCF)		Gas-Well Gas
Produced
(BCF)		total gas
produced
(BCF)		total gas flared
or vented
(BCF)		% flared
or vented
2015588.4719.41307.810.30.8
2016631.7589.11220.89.70.8
2017637.3441.21078.59.90.9
2018623.1370.1993.210.61.1
2019670.2364.11034.311.71.1
2020581.4224.9806.310.41.3
2021582.2209.5791.78.21

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