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  • Deepwater (>1000′) activity continues to dominate, accounting for 61% of the well starts.
  • Not a single company drilled both shelf and deepwater wells.
  • While shelf facilities currently account for only about 7% of GoM oil production, 1122 of the 1179 remaining platforms are on the shelf and they account for 24% of GoM gas production, most of which is environmentally favorable nonassociated gas.
  • Two companies, Arena and Cantium, accounted for 75% of the shelf well starts. Excluding the CCS bids, Arena and Cantium were the most active shelf bidders in Sale 279. Arena bid alone on 7 blocks. Cantium was the high bidder on 5 blocks. (Focus Exploration was high bidder on 4 shelf blocks and was “outbid” by Exxon for High Island 177.)
  • One company, Shell, accounted for 39% of the deepwater well starts
  • One of BP’s exploratory wells (drilled subsequent to Sale 257) was in Green Canyon 821, immediately south of GC 777, the block that BP/Talos bid $1.8 million for in Sale 257. That bid was rejected by BOEM. In sale 259, BP was the sole bidder for GC 777, and their bid was only $583,000, less than 1/3 of their Sale 257 bid. Perhaps the GC 821 exploratory well reduced the value of GC 777? Will this lower bid now be accepted?
DW explDW devshelf explshelf dev
Anadarko51
Arena22
BOE14
BP23
Byron2
Cantium20
Chevron3
Contango2
Cox2
Eni25
EnVen5
Greyhound2
Hess2
Kosmos1
LLOG31
Murphy4
QuarterNorth2
Shell259
Talos28
Walter1
Woodside31
Gulf of Mexico well starts during 2022 and the first quarter of 2023

Cheryl Anderson took oil spill data analysis to a level worthy of a world class offshore program. In my opinion, Cheryl was the top analyst in the history of the OCS program, a true Hall of Famer. Regardless of the politics of the day, she always stuck to the facts and resisted “spin,” and that was a trait her colleagues greatly admired.

Cheryl retired at the end of 2010 and her final update, with assistance from 2 other OCS program icons, Melinda Mayes and Bob LaBelle, was published in June 2012. That update is attached.

ITOPF also deserves mention for their comprehensive tanker spill data. A recent chart is pasted below. ITOPF’s data are nicely presented on their website. No such data are available for international offshore production.

In addition to the 94 nearshore Texas leases Exxon acquired in Sale 257, the company was the sole Sale 259 bidder for all but one of 69 nearshore Texas blocks. The exception was High Island 177 (in red above). So who gets that lease?

  • the company (Exxon) that was the sole participant in a de facto CCS sale (bid of $182,750)
  • the company (Focus Exploration) that was participating in the announced oil and gas lease sale (bid of $145,177)

If Exxon is just acquiring these leases for evaluation purposes in preparation for a possible CCS sale in the future, their lease acquisitions may be okay. If they are planning on retaining these leases for actual sequestration operations, that is not okay, at least not until a competitive process has been established for awarding or reclassifying such leases. To date, no lease terms or bid evaluation procedures have been proposed for carbon sequestration leases; nor has an environmental review been conducted pursuant to NEPA.

Questions about Gulf of Mexico carbon sequestration

Jennifer Granholm

Energy Secretary Jennifer Granholm last month said it would be difficult for the U.S. to take advantage of low oil prices to replenish the Strategic Petroleum Reserve because of maintenance at two of the four sites.

The Financial Times reported, citing people familiar with Saudi Arabia’s thinking, that Riyadh was “irritated” by that comment. In any case, it came on top of stress in the financial sector that had dragged oil prices as low as $64 in March.

Market Watch

As previously posted, the SPR is easier to drain than fill. The reserve is still flat-lined at 371.6 million barrels or about half full.

In the past 2 years, at least 12 workers died suddenly at Gulf of Mexico facilities from “natural causes.” BSEE’s recent medical evacuation presentation provided information on 6 non-operational fatalities that occurred in 2022:

7/28: Employee (galley hand) was found in the bathroom non‐responsive with minimal electrical activity indicated on the EKG.

8/2 Advised of person down in the galley/T.V. area. Upon arrival in the area observed person on the floor being held by his supervisor. A white foam was coming out of his mouth and nose. Placed him on his side in order for the foam to drain. He was breathing and had a faint pulse. It was observed that he then appeared to stop breathing. Unable to find a radial or carotid pulse. CPR was started and AED was retrieved. AED instructions were followed. A shock was administered and CPR continued for approximately 50 minutes with no pulse or response.

8/18: Contract Personnel (CP) complained of not feeling well and went to his assigned room. It was noticed that CP did not come down for lunch and other personnel went to check on CP and CP was unresponsive.

9/7: CI was in galley of the M/V GO Triumph, waiting on weather, with co‐workers, when he made an exclamation and collapsed to the floor. Co‐workers and contract safety technician immediately ran to his aid. Breathing was sporadic for a minute then ceased and he was unresponsive.

9/23: At approximately 8:20 AM on September 23rd, platform personnel discovered an unresponsive employee (IP) face down on the deck. IP was rolled onto his back, evaluated, and CPR began. Other personnel were dispatched to retrieve AED and medical supplies, while one went to make notifications. Shortly after, personnel arrived with the AED, and it was applied to the IP. Personnel continued CPR while waiting for medical evacuation helicopter. At approximately 12:00 PM, IP was removed from facility by medical evacuation helicopter and subsequently, formally, pronounced dead.

10/21: Employee was assisting production personnel fueling the crane when he suddenly collapsed onto the platform deck and became unresponsive. Personnel on the platform quickly responded and immediately applied an AED to the Employee and began CPR. A medivac aircraft was dispatched for medical support assistance while platform personnel continued to resuscitate the
employee. Medivac personnel arrived on location and relieved personnel working on employee. Following an unsuccessful attempt to revive the employee, he was transported to Houma, La. and released to the Terrebonne Parish Coroner’s Office. Workers on the platform stated the employee was acting normal during breakfast time and during the morning safety meeting. The employee did not complain of any type of illness during the morning time prior to the event occurring.

Why are screened and presumably healthy offshore workers dying suddenly at what seems to be a historically high rate? Is this happening elsewhere in the offshore world? Is anyone investigating this disturbing trend? if not, why not?

As suggested in a previous post, further investigation should be a high priority for the Coast Guard and BSEE with appropriate medical assistance.

Rigs-to-Radar!

A new addition to our Rigs-to-Reefs+++ page courtesy of MaritimePhoto.

“Blue Marlin” – sea based X-Band radar on board a heavy lift and transport vessel
Photo: U.S. Navy / Journalist 2nd Class Ryan C. McGinley

The encouraging start to 2023 GoM production is likely due, at least in part, to Shell’s Vito and Murphy’s King’s Quay ramping up production. Other deepwater startups should boost production later this year.

EIA data

companyno. of Sale 259 high bids
(Sale 257 in parentheses)
total Sale 259 high bids
($ millions)
Chevron75 (34)108
BP37 (46)46.7
Shell21 (20)20.1
Equinor16 (1)18.3
Beacon13 (4)9.0
Anadarko (Oxy)13 (30)8.6
Red Willow13 (5)3.8
Hess12 (2)8.3
Woodside12 (8)6.3
Houston Energy8 (5)11.6
from BOEM data

As anticipated, the increase in royalty and rental rates appears to have further weakened interest in leases in the shallow waters of the Gulf of Mexico continental shelf. Note the sharp declines in both the number of blocks receiving bids and the bid amounts.

lease saleblocks with bids
(excluding CCS bids)
sum of high bids
($million, excluding CCS bids)
25746$8.1
25929$4.1