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Archive for the ‘Regulation’ Category

Dominion’s suit challenging the Coastal Virginia Offshore Wind suspension order is attached.

Summary: “BOEM’s order sets forth no rational basis, cannot be reconciled with BOEM’s own regulations and prior issued lease terms and approvals, is arbitrary and capricious, is procedurally deficient, violates the Outer Continental Shelf Lands Act (“OCSLA”), and infringes upon constitutional principles that limit actions by the Executive Branch. This Court must therefore vacate the Order and enjoin BOEM from taking further action with respect to that Order.”

Key points raised by Dominion:

  • Dominion Energy Virginia (DEV) has spent approximately $8.9 billion to develop CVOW to date, which is over two-thirds of the total projected cost of $11.2 billion.
  • BOEM and Interior afforded DEV no advance warning or due process regarding the Order for CVOW.
  • The Order alleges no CVOW violation or deficiency.
  • The Order points to unnamed “national security threats” based on a November 2025 “additional assessment regarding the national security implications of offshore wind projects” by DoD, “including the rapid evolution of relevant adversary technologies and the resulting direct impacts to national security from offshore wind projects” generally.
  • The Order deems this information “new” and “classified” without any justification or detail. Moreover, as BOEM and DoD should know, certain DEV officials have security clearances to receive and review classified information, yet never were afforded such an opportunity prior to issuance of the Order.
  • DEV is suffering more than $5 million per day in losses solely for costs relating to vessel services associated with the Order. DEV is also incurring losses related to additional storage costs for the significant amount of equipment, idle workforce, contractual penalties, and additional costs.
  • BOEM’s Order comprises a single page, identifies no specific concerns, and provides no supporting documentation.
  • Agencies are required to consider costs and benefits in their decision-making
  • Agencies are required to consider alternatives in their decision-making.
  • The CVOW Order unlawfully deprives DEV of a property interest without due process.

    Dominion’s weakest argument follows (bad State legislation shouldn’t dictate Federal energy policy):

    CVOW is critical to Virginia’s legislative clean energy directive and DEV’s commitment to achieving net-zero emissions. The VCEA requires the transition of Virginia’s electric grid to 100 percent non-carbon producing energy generation by 2045. Va. Code § 56-585.5. The VCEA also states that the construction of Virginia offshore wind facilities is in the public interest. Va. Code § 56-585.1:11 (C)(1).

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      Attached are PHMSA’s Christmas week Emergency Special Permit and Permit Analysis document. Is the path clear to restart SYU production before New Year’s day?

      Three excerpts from the first attachment are pasted below. The last paragraph on p. 2 succinctly explains PHMSA’a emergency permit:

      PHMSA was able to assume jurisdiction from the State because the pipeline transports Federal OCS oil and is thus inherently interstate. The perceived problem with a PHMSA takeover had been the court approved Consent Decree that was executed following the 2015 Refugio pipeline spill. That Decree specifies that the State Fire Marshal must approve a restart of the pipeline. The first paragraph on p. 2 of the permit explains PHMSA’s position that the Consent Decree has been superseded.

      The provision pasted below (p. 4 of the permit) seems contradictory in that it stipulates compliance with the Consent Decree. However, PHMSA apparently sees no contradiction in that references to the Fire Marshal (OSFM) should now be read as references to PHMSA. PHMSA presumably included this provision to reaffirm the need to comply with the technical requirements in the Decree.

      The second attachment is PHMSA’s analysis of the special permit. Note that the permit expires in 60 days. Public notice and opportunity for comment would be required for a renewal.

      Environmental organizations reacted quickly to the PHMSA permit, filing an emergency motion in the 9th circuit (third attachment). Observations:

      • Impressive effort given the time crunch. The PHMSA permit was issued on 12/23, just 3 days prior to the court filing. No Christmas break for those folks!
      • If you wonder why the petition was filed with the 9th Circuit (seemed convenient given the 9th Circuit’s reputation), a filing at the Circuit level is required for appeals of PHMSA orders.
      • Petitioners strongest argument: Sable is not entitled to emergency relief, as there is no real emergency. PHMSA asserts that EO 14156, which declared a National Energy Emergency, supports the emergency permit.
      • The petitioners environmental doom prediction is not compelling. PHMSA’s position is that the mitigations they are imposing (reduced operating pressure, inline inspections, testing and sampling, etc) provide protection equal to or greater than than the corrosion remediation requirement that is being waived.
      • The petitioners asked the Court for relief no later than 12/26. That date has passed. Will there be a ruling today?

      Barring an injunction, odds are that Sable restarts production prior to New Year’s Day, when a requirement (SB 237) for a new Coastal Development Plan, takes effect.

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      Leslie Beyer, Assistant Secretary for Land and Minerals Management (ASLM), has stepped down from her post as the leader of the Dept of the Interior’s offshore energy programs. She was the senior official at this month’s BGG1 lease sale, and made strong remarks about the importance of the offshore oil and gas program. Ms. Beyer was confirmed by the Senate in September.

      Lanny Erdos, Director, Office of Surface Mining Reclamation and Enforcement, has been named Acting ASLM.

      This leaves the offshore energy program without a confirmed Asst. Secretary and with Acting Directors at both BOEM (Matthew Giacona) and BSEE (Kenny Stevens).

      Lanny Erdos

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      Attached is the letter sent to operators of the 5 projects that have been suspended. The cited regulation reads as follows:

      § 585.417 When may BOEM order a suspension?

      BOEM may order a suspension under the following circumstances:

      (a) When necessary to comply with judicial decrees prohibiting some or all activities under your lease; or

      (b) When the suspension is necessary for reasons of national security or defense.

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      See the letter below.

      California and Santa Barbara County remain silent. Caught off guard before the holiday?

      More from the Santa Barbara Independent.

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      The anticipated State-Federal jurisdictional battle over Sable’s Las Flores Canyon Pipeline is on! See the attached letter from the Pipeline and Hazardous Materials Safety Administration (PHMSA) declaring that the pipeline is under Federal jurisdiction.

      The major hurdle for PHMSA/Sable is the court approved Consent Decree that was executed following the 2015 Refugio pipeline spill. The Decree, which designates the California Fire Marshal as the sole regulator for the pipeline, is not mentioned in the PHMSA letter. Needless to say, another major legal battle looms.

      Excerpt from the PHMSA letter:

      PHMSA’s evaluation of the Las Flores Pipeline confirms that it transports crude oil from the OCS to an onshore processing facility at Las Flores Canyon and continues the transportation of crude oil from Las Flores Canyon to Pentland, California. Consistent with Appendix A, the Las Flores Pipeline is an interstate pipeline. As portions of the Las Flores Pipeline were previously considered to be intrastate and regulated by OSFM, PHMSA is notifying OSFM that the Las Flores Pipeline is subject to the regulatory oversight of PHMSA.

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      7/13/2024 Vineyard Wind turbine blade failure offshore Nantucket

      The attached Memorandum of Understanding between Vineyard Wind (VW) and the Town of Nantucket is long on bureaucratic procedures and short on risk mitigation and penalties.

      The agreement details requirements for monthly reports, liaisons, written correspondence, plan reviews, and participation on incident management teams, but excludes any monetary penalties for past or future incidents. (With regard to penalties, should BSEE have assessed civil penalties for the 2024 turbine incident in accordance with 30 CFR § 285.400 (f)? This was a major pollution event.)

      This MOU provision gives the impression that the Town is subordinate to VW:

      “The Town will provide Vineyard Wind 1 up to 4 business days, if required, to identify and correct errors in the Town’s intended public communications about the Project.”

      The responsible party should not be exercising oversight over the communications of an affected local government. Can you imagine Santa Barbara County reaching such an agreement with Sable Offshore?

      Finally, the MOU further establishes the Town as a de facto partner in the project. VW, not the Town, is the responsible party and must be held fully accountable for project performance.

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      Seconds matter – training, equipment maintenance, and effective leadership are critical!

      Several BSEE Safety Alerts have just been released. Of particular importance to those interested in deepwater drilling is the attached alert describing two separate Emergency Disconnect Sequence (EDS) incidents.

      The EDS (see the diagram above) is a critically important safety protocol that ensures that a well is sealed and the riser and rig are disconnected from the blowout preventer in the event of a well control emergency, unforeseen weather/ocean conditions, loss of power, or positioning system malfunction. Note that the Macondo blowout could have been prevented if the Deepwater Horizon crew had activated the EDS in a timely manner.

      The two EDS events cited in the Safety Alert were presumably the March 28, 2025 and March 5, 2024 incidents investigated by BSEE district offices. The drillships were the Stanley Lafosse and the Deepwater Poseidon The investigation reports provide detailed information on these incidents.

      Unintended riser disconnects not associated with EDS activations are a related safety and pollution concern that necessitated the issuance of a 2000 Notices to Lessees that was subsequently updated:

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      Sable Offshore is attempting to restart the same pipeline that caused the Refugio Oil Spill in 2015. | Credit: Paul Wellman File Photo

      Sable Offshore oil believes the federal Pipeline and Hazardous Materials Safety Administration (PHMSA) , not the California Fire Marshal, should have jurisdiction over the company’s onshore pipeline.

      I once had the same opinion as Sable. Their pipeline is, by definition, an interstate line because it carries OCS production. Then I read Appendix D of the court approved Consent Decree that was executed following the 2015 Refugio pipeline spill. That Decree is quite clear regarding regulatory jurisdiction, and would have to be overturned to transfer authority to PHMSA.

      The full Consent Decree is attached. Pasted below is an excerpt from Appendix D:

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      Vineyard Wind turbine blade that was damaged on July 13, 2024, captured by a New Bedford commercial fisherman. Photo courtesy of Anthony Seiger

      Excellent New Bedford Light piece on the unacceptable delay in completing the blade failure investigation report.

      The Town of Nantucket’s attorney, Greg Werkheiser of Cultural Heritage Partners, told The Light last month that “it’s taken far too long” to get a final report on the blade failure. 

      It’s noteworthy that there have also been unacceptable delays in issuing panel reports for serious offshore oil and gas incidents:

      ncident datereport dateelapsed time (months)incident type
      5/15/202110/31/202329.5fatality
      1/24/20217/24/202330fatality
      8/23/20202/15/202330fatality
      7/25/20202/15/202331spill

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