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More Nord Stream intrigue!

November 22, 2024 by offshoreenergy

American businessman Stephen Lynch wants to acquire the Swiss company that controls the Nord Stream 2 pipeline.

From his investment firm’s website: Over the last twenty years, Mr. Lynch has acquired and managed distressed assets in Eastern Europe, Central Asia, Russia, and Ukraine. He specializes in securing cross-border collaboration on transactions and settlements around special situations and corporate conflicts. Lynch is a life member of the Council on Foreign Relations.

Lynch has worked closely with the US Department of The Treasury’s Office of Foreign Assets Control (OFAC) to acquire and de-Russify important industrial assets in U.S. partner nations.

With regard to Nord Stream: “The bottom line is this: This is a once-in-a-generation opportunity for American and European control over European energy supply for the rest of the fossil-fuel era,” Lynch told the Wall Street Journal.

Nord Stream 2 bankruptcy proceedings are scheduled to begin in January.

A “US official” told the Washington Post that a Nord Stream revival is not in the US interest right now. However, a resumption of the flow of Nord Stream gas could be a significant consideration in talks to end the Ukraine – Russian war. Also, in light of economic and energy supply challenges, there is growing German interest in restoring ties with Russia.

This appears to be a serious initiative on the part of Mr. Lynch that should not be discounted.

Also looming is a court decision in the litigation between Nord Stream AG and their insurers.

Posted in energy policy, pipelines | Tagged , , , , | Leave a Comment »

Rigs to Reefs!

November 22, 2024 by offshoreenergy

Attached is an excellent Scientific American article featuring BOE contributor and decommissioning specialist John Smith, former colleague and marine biologist Dr. Ann Bull, and Dr. Milton Love, the leading authority on California’s offshore platform ecosystems.

I had the pleasure of taking a highly informative boat tour around Platform Holly with Dr. Love and a group of international visitors. Holly, which is pictured at sunset in the BOE header, is among the platforms awaiting decommissioning.

Dr. Love on the total removal of California offshore platforms:

“As a biologist, I just give people facts,” he says. “But I have my own view as a citizen, which is: I just think it’s criminal to kill huge numbers of animals because they settled on a piece of steel instead of a rock.”

The Afterlives of Oil RigsDownload

Posted in California, decommissioning, Offshore Energy - General, rigs-to-reefs | Tagged , , , , , , | Leave a Comment »

A detailed Der Spiegel article on the Nord Stream sabotage

November 21, 2024 by offshoreenergy

sailboat Andromeda
testing candidate bomb designs

Der Spiegel: “Wie ein ukrainisches Geheimkommando Nord Stream sprengte“

Observations:

  • Der Spiegel’s detailed account is based on interviews with the perpetrators whose identities are being withheld.
  • ~a dozen men and one woman, all Ukrainians, were involved in the sabotage. Some were soldiers, some were civilians; some had past connections with the CIA.
  • <$300,000 budget funded by a Ukrainian businessman
  • Saboteurs received no payments
  • Low tech operation using the sailboat Andromeda
  • The article includes details on how the mission was accomplished.
  • To the commandos, Nord Stream sabotage was viewed as a military objective, a legitimate act of self defense.
  • The team understood that only a small hole in the outer wall would suffice to burst the pipe given the gas pressure in the lines.
  • Tested bomb designs in a lake, and trained in a flooded mine to depths of 100 m.
  • Zelensky was not fully trusted and was intentionally not informed of the plan. (However, the authors are not completely ruling out some Zelensky involvement in the planning.)
  • Western intelligence heard about the plan 3 months before the operation. Zelensky was then informed by a CIA officer in Kiev.
  • A CIA agent contacted one of the commandos who he knew. To protect the mission, the commando said he didn’t know anything about such a plan, but would inquire further.
  • The commandos decided they needed to get on with the operation before sea conditions worsened in the fall.
  • 6 bombs were planted under sometimes difficult conditions. One did not explode, so the Nord Stream 2 B pipeline remained intact.

Der Spiegel’s account seems credible. If that is the case, Seymour Hersh and his informant have some explaining to do.

Posted in energy policy, pipelines | Tagged , , , , | 2 Comments »

Loss of power to Johan Sverdrup field raises further questions about Norway’s push to electrify offshore facilities

November 20, 2024 by offshoreenergy

Johan Sverdrup field, 155 km from shore

Production from Equinor’s important Johan Sverdrup field, which accounts for 755,000 bopd (36% of Norway’s oil production), was shut-in on Monday as a result of a power outage. Production was in the process of being restored on Tuesday.

According to Equinor, the outage was caused by overheating at an electric converter station onshore.

A 2022 BOE post questioned Norway’s push to power offshore platforms with electricity transmitted from shore. This incident reinforces those concerns. Summary:

  • Most offshore platforms produce sufficient gas to support their power demands
  • Assuming gas that is not used to power a platform is marketed and consumed elsewhere, the net (global) reduction in CO2 emissions from electrifying offshore platforms is negligible. (Perhaps there is actually a small increase in net emissions given the power required to transport the gas to markets and the emissions associated with onshore power generation).
  • Offshore power demands are highly variable, especially when drilling operations are being conducted.
  • Gas turbines are reliable, and capable of responding to variable power demand. Excess generation capacity is typically provided.
  • Power from shore increases the cost of platform operations and could decrease ultimate recovery of oil and gas resources.
  • Per NPD, electrification of the shelf will increase electricity prices for onshore consumers and increase the need for onshore facility investment.
  • Gas turbines or diesel generators are still necessary to satisfy emergency power needs at the platforms.
  • Long power cables are vulnerable to damage (accidental or intentional), as are onshore power stations.

I hope the investigation of this incident considers some of these broader electrification policy issues.

Equinor diagram: The purple cable shows power from shore to Johan Sverdrup phase 1, established in 2018. The yellow power cable shows power from shore to Johan Sverdrup phase 2 and the Utsira High area solution, from 2022. The orange cable shows power from shore to the Sleipner field centre and connected fields from late 2022. Black cable shows existing power cables at Sleipner field centre and to the Gudrun installation.

Posted in accidents, climate, Norway, Offshore Energy - General | Tagged , , , , , , | Leave a Comment »

Thoughts on the appointment of Doug Burgum as Secretary of the Interior

November 19, 2024 by offshoreenergy

  • The Secretary of the Interior is the most important energy production position in the US govt, particularly for the offshore sector.
  • In recent years energy policy has been increasingly influenced (if not directed) by White House staff, most notably the White House Climate Office. Given that Burgum will also lead the new created National Energy Council, direction from White House staffers or other departments should not be an issue.
  • Burgum should work effectively with Dept. of Energy appointee Chris Wright, an engineer who understands energy production.
  • There is no apparent Republican dissent, so Burgum should have no problem being confirmed.
  • All of the offshore policy forecasts in the post-election post still stand.
  • Burgum is currently the Governor of North Dakota. Some energy production stats for the state:
    • 2023 oil production: 435,080,323 bbls. ND is the 3rd leading oil production state behind TX and NM. Most ND production is from the Bakken formation (shale).
    • ND ranks 4th if the OCS, for which Bergum will soon be responsible, is included. The OCS ranked 2nd in oil production, behind only TX, despite seemingly being managed to fail.
    • 2023 gas production: 1.2 tcf. ND ranks 10th in natural gas production.
    • Current number of active drilling rigs: 39
    • Wind: In 2023, wind was the second-largest electricity generating source in ND behind coal. At the beginning of 2024, ND had about 4,000 megawatts of installed wind power generating capacity.
  • What about carbon sequestration (disposal)?
    • As Governor, Burgum supported CCS projects that could be lucrative for North Dakota.
    • As Interior Secretary and Energy Czar, he will have to consider the high Federal subsidy costs, efficacy, and net environmental benefits.
    • Companies looking to benefit from publicly financed CCS projects will lobby hard for Federal support. Budget hawks and most environmental activists will be strongly opposed. It will be interesting to see who prevails.
    • This blog has consistently opposed offshore carbon disposal.

Posted in CCS, energy policy, Offshore Energy - General, Regulation | Tagged , , , , , , , , | Leave a Comment »

Chris Wright: “Thank you, North Face”

November 18, 2024 by offshoreenergy

Three years ago, the Colorado Oil and Gas Association brought smiles to our faces by recognizing North Face for their hypocrisy in refusing to sell jackets to an oil industry service company.

North Face, whose products are dependent on oil and gas, was given the Association’s first ever Customer Appreciation Award to draw attention to the company’s hypocrisy and chutzpah.

Fast forward three years and Chris Wright, the man behind the North Face award, has been nominated to be Secretary of Energy! BOE enthusiastically endorses this nomination!

Chris Wright’s bio: MIT engineer, shale gas innovator, entrepreneur, and more

Posted in energy policy | Tagged , , , | Leave a Comment »

EIA associated gas production analysis omits the Gulf of Mexico

November 15, 2024 by offshoreenergy

The EIA reports an 8% increase in 2023 US associated gas production as crude oil production rose to record levels.  The Permian Basin, the dominant US crude oil producer, is unsurprisingly the leading associated gas producer.

EIA’s analysis inexplicably ignores the Gulf of Mexico OCS. The Gulf produced an average of 1.64 bcf/d of casinghead (associated) gas in 2023, ranking the GoM just behind the Eagle Ford and significantly above the Niobrara and Anadarko regions (see chart above). It’s also noteworthy that most production from the regions on the EIA chart is from private land, and is not constrained by 5 year leasing plans and other restrictive Federal policies.

80% of GoM gas production is from deepwater leases. The % of associated gas produced on deepwater leases is even higher. The 2 leading GoM gas producers, Shell and bp, only operate deepwater leases. The % of their 2023 gas production that was associated gas was 93% for Shell and 100% for bp.

Posted in energy policy, gas, Gulf of Mexico, natural gas | Tagged , , , , | Leave a Comment »

Does Exxon fear the collapse of the CCS house of cards?

November 14, 2024 by offshoreenergy

Exxon CEO Darren Woods’ is concerned that US withdrawal from the Paris climate agreement would threaten carbon capture and sequestration (CCS), the foundation for which is government mandates and generous taxpayer subsidies.

Exxon projected a $4 trillion carbon capture and sequestration (CCS) market by 2050. The company was a primary driver behind the late additions to the 2021 Infrastructure Bill. That bill authorized carbon disposal on the OCS, exempted such disposal from the Ocean Dumping Act, and authorized $2.5 billion for commercial CCS projects.

Exxon sought an edge over CCS competitors by improperly acquiring 163 OCS oil and gas leases (map below) for carbon disposal purposes. Conversion of these leases is not authorized, which means they will expire at the end of their primary (5 year) term absent legislative or regulatory action.

The only solid support for CCS is from companies hoping to benefit from subsidies and charges to industries and individual energy consumers. It’s time to end the Federal government’s CCS programs.

199 oil and gas leases were wrongfully acquired at Sales 257, 259, and 261 with the intent of developing these leases for carbon disposal purposes. Repsol was the sole bidder at Sale 261 for 36 nearshore Texas tracts in the Mustang Island and Matagorda Island areas (red blocks at the western end of the map above). Exxon acquired 163 nearshore Texas tracts (blue in map above) at Sales 257 (94) and 259 (69).

Posted in CCS, climate, conferences, energy policy, Offshore Energy - General, Regulation | Tagged , , , , , , | 4 Comments »

More on the alleged GE Vernova turbine blade data falsification. Possible US civil or criminal penalties?

November 13, 2024 by offshoreenergy

LM/GE Vernova turbine blade plant. Photo credited by the New Bedford Light to Jean-Philippe Thibault/Journal Gaspésie Nouvelles.

On Oct. 24, Radio Gaspesie reported serious data falsification allegations related to the manufacturing GE Vernova turbine blades at their Gaspé, Quebec facility. GE Vernova’s delay in commenting on those charges is surprising given their economic and legal implications in both Canada and the US.

GE Vernova has informed the New Bedford Light that they have taken corrective actions at their blade facility in Gaspé after an extensive internal review of their blade manufacturing and quality assurance program. However, they have yet to comment on the data falsification allegations.

Actions speak louder than words, and the Light reports that GE Vernova laid off nine managers and suspended 11 unionized floor workers at the Gaspé factory. A representative for the union informed the Light that the production manager has been dismissed and the general manager has resigned.

Neither Vineyard Wind nor BSEE, the Federal safety regulator for the Vineyard Wind project, has commented on the matter. BSEE’s investigation of the blade failure is still pending and has seemingly gotten more complicated as a result of the manufacturing issues.

In addition to legal proceedings in Quebec, GE Vernova and Vineyard Wind are subject to possible civil and criminal penalties in the US. Civil penalties, which are administered by BSEE, seem likely given the extensive pollution from turbine blade fragments.

Criminal penalties, which are possible if the data falsification charges are proven true, are imposed by the Dept. of Justice. The applicable criminal penalties statute is pasted below.

43 U.S. Code § 1350 – Remedies and penalties – (c) Criminal penalties

Any person who knowingly and willfully (1) violates any provision of this subchapter, any term of a lease, license, or permit issued pursuant to this subchapter, or any regulation or order issued under the authority of this subchapter designed to protect health, safety, or the environment or conserve natural resources, (2) makes any false statement, representation, or certification in any application, record, report, or other document filed or required to be maintained under this subchapter, (3) falsifies, tampers with, or renders inaccurate any monitoring device or method of record required to be maintained under this subchapter, or (4) reveals any data or information required to be kept confidential by this subchapter shall, upon conviction, be punished by a fine of not more than $100,000, or by imprisonment for not more than ten years, or both. Each day that a violation under clause (1) of this subsection continues, or each day that any monitoring device or data recorder remains inoperative or inaccurate because of any activity described in clause (3) of this subsection, shall constitute a separate violation.

Posted in accidents, Offshore Wind, Regulation | Tagged , , , , , , , | Leave a Comment »

Outer Cape residents reject pro-wind ballot initiative

November 12, 2024 by offshoreenergy

Ballot Question 7: Shall the State Representative from this district be instructed to vote in favor of legislation that would support the development of SouthCoast Wind and Commonwealth Wind and other possible future offshore and onshore wind power developments in Massachusetts?

This nonbinding initiative, which was reportedly the work of an individual wind advocate, was a surprise addition to the ballot for residents of the 4th Barnstable District of the Massachusetts House. That district includes the Outer Cape towns of Chatham, Eastham, Harwich, Orleans, Provincetown, Truro, and Wellfleet (see map above).

While nonbinding, the ballot initiative was intended to demonstrate support among Outer Cape residents for offshore wind development. However, perhaps unexpectedly, the initiative failed with 52.4% voting against (graphic below). It’s noteworthy that 82% of South Shore (Massachusetts) voters supported offshore wind development when a similar initiative was on the ballot in 2008. That’s a massive decline in support albeit in a different coastal area of the state.

The opinion of Outer Cape residents is important because their towns are the closest to 3 of the 4 leases (0564, 0567, and 0568 in the graphic below) receiving bids at the Gulf of Maine sale. Those leases are directly offshore from the Cape Cod National Seashore.

Interest in the Gulf of Maine sale was weak. All bids were for the minimum allowable amount of only $50/acre.

Posted in energy policy, Offshore Wind | Tagged , , , , , , | Leave a Comment »

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