Bud's Offshore Energy (BOE)

Lars Herbst analyzed GoM permitting and drilling activity from 2011 to 2021. His data and observations are summarized below.

• Shelf (shallow water) exploratory drilling is at historic low levels with only a single exploration well drilled in both 2020 and 2021. That trend appears to have continued into 2022, as only one shelf exploration well (drilled by Contango) has been spudded YTD.
• 2021 also saw a significant drop in deep water development wells.
• Over the time period examined, deep water development is led by deepwater exploration. The same cannot be said for the development of shallow water leases where prospects are more mature and data are more available.
• The only shelf well drilled in 2021 (Walter Oil and Gas) was in relatively deeper water (566 feet). That well was drilled with a deepwater semisubmersible (the Valaris 8503). This is the shallowest water depth for a GoM semisubmersible drilling operation in recent history. The rig had a modified DP/moored configuration with explosive disconnects on the mooring lines so the rig could move off location if needed during an emergency disconnect scenario. That mooring disconnect would also let the rig evade hurricanes without the need for anchor handling vessels. 
• The 2012 spike in deepwater permit approvals is the result of the Macondo drilling moratorium backlog.