No bids were accepted during BBG1’s Phase 1 review. This means that none of the tracts receiving bids were determined to be nonviable as was the case for the 199 tracts that were improperly acquired for carbon disposal purposes in Sales 257, 259, and 261. (Unsurprisingly, neither of the acquiring companies has submitted an exploration plan for any of these CCS leases. The leases will likely expire without activity. Much to the dismay of the large and diverse group of opponents, the carbon disposal industry is focusing on onshore locations along the Gulf Coast.)
Pasted below are excerpts from Sable’s Prospectus Supplement. Is Sable serious about pursuing a Santa Ynez Unit strategy that employs a production and treatment vessel 3.5 miles from shore ala the development option that was reluctantly approved by the Federal govt in 1974, two decades before the onshore infrastructure was in place?
The OS&T option is inferior to onshore treatment and pipeline transportation in every way – spill risks, air emissions, economics, ultimate oil recovery, transportation to market, natural gas utilization, and public benefit.
This blogger supports a resumption of Santa Ynez Unit production. However, the only responsible path forward is to do the right thing and continue to pursue the onshore pipeline approvalsadministratively and legally. It is far better to defend a good project than a contrived workaround.
When will BOEM share Sable’s proposed “update”(actually a massive revision) to the SYU Development and Production Plan, as they are obligated to do?
Evaluation of the revised plan will require a detailed environmental review.
Operationally, BSEE and the Coast Guard will need to carefully consider vessel integrity, treatment capabilities, mooring and offloading plans, transportation schemes, gas utilization/injection, and many other technical details.
Meanwhile, does Exxon, the previous (and future?) owner, remain on the sidelines when the OS&T permitting circus begins in earnest?
On September 29, 2025, Sable announced that it is evaluating and pursuing an offshore storage and treating vessel (“OS&T”) strategy to provide access to domestic and global markets via shuttle tankers for federal crude oil produced from the SYU in the Pacific Outer Continental Shelf Area (the “OS&T Strategy”). Continued delays related to the Santa Ynez Pipeline System have prompted Sable to evaluate and pursue the OS&T Strategy. On October 9, 2025, Sable submitted a Development and Production Plan update for the SYU to the Bureau of Ocean Energy Management (“BOEM”). Prior to implementation of the OS&T Strategy, regulatory authorizations are required, including clearance from BOEM.
Preparations for the OS&T Strategy include the acquisition of a suitable OS&T vessel, certain refitting and upgrades to the vessel and the SYU equipment, transportation of the vessel to SYU, and related installation. In connection with implementation of the OS&T Strategy, the Company expects to opportunistically acquire an existing OS&T in the first quarter of 2026, with delivery of the vessel to SYU expected in the third quarter of 2026. Following the acquisition of the vessel, and vessel and platform upgrades and installation, Sable would expect to begin sales from all SYU platforms in the fourth quarter of 2026, with expected comprehensive oil production rates of over 50,000 barrels of oil per day, utilizing the OS&T within the SYU federal leases, provided the Company receives regulatory clearances. Sable estimates that the total capital required to execute the OS&T Strategy is approximately $475.0 million. The Company has already incurred a small portion of such capital expenditures, with the vast majority of such capital expenditures remaining, provided the Company receives regulatory clearances. See “Risk Factors—Risks Associated with Our Operations—In order to commence operations pursuant to an OS&T offtake strategy, we will require clearances and permitting, including from BOEM.”
“We have not been finding enough new fields.” That’s William DeMis, president of Richelle Court, LLC, who said that, in addition to not finding enough, we keep erecting new ways to export what we’re not finding.
The way, he said, to avert the coming shortage is for people to find new sources of gas outside of Haynesville field, which for years, considering its proximity to the Gulf Coast, and the petrochemical plants of Southwest Louisiana, as well as pipelines, made it a swing producer for natural gas.
“But I can tell you from bitter experience over the last three years that finding people to fund greenfield exploration is darn near impossible. There is scant capital to drill natural gas wildcats in the U.S.” said DeMis.
“The Bureau of Ocean Energy Management (BOEM) is initiating the first steps that could potentially lead to a lease sale for minerals on the Outer Continental Shelf (OCS) offshore Alaska by publishing this request for information and interest (RFI).”
Attached is the supplemental complaint in the lawsuit Revolution Wind, LLC v. United States Department of the Interior, Case No. 1:25-cv-02999-RCL, filed in the U.S. District Court for the District of Columbia.
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.
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).
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).
Heavy mineral geodatabase showing marine samples offshore of Virginia. A: 620 samples with heavy mineral data from previous projects, symbol colors determined by the percent of total heavy minerals (THM) obtained through gravity spiral separation methods. B: M21AC00010 samples (indicated with white halo) from Sandbridge Shoal and Atlantic Channel vibracores for THM and mineralogical analyses.
Odyssey’s primary targets are phosphate, which is now on the critical minerals list, and rare earth element’s titanium and zirconium. This would be a shelf dredging operation, in partnership with Great Lakes Dredge & Dock Company, rather than the deepwater module collection being proposed for the Pacific.
The fact that the sand recovered during the dredging process could be used for beach nourishment should appeal to adjacent coastal communities.
Odyssey Marine’s CEO discusses the proposed Virginia offshore program starting at the 4:00 minute mark in the video below.
Which majors will be the most active bidders? BP (50 high bids), Chevron (22), and Shell (12)
Will former Gulf of Mexico stalwarts Exxon and Conoco Phillips participate for the first time in years? They did not.
How many companies will submit bids? Would like that to be a number >35. Only 30 companies participated.
How many tracts will receive bids? A number >300 would be very encouraging. Only 181 tracts received bids.
Will the total high bids exceed $400 million? No, the total was $279.4 million.
Will we see an increase in shelf interest? Shelf bidding continued to be limited (map). Renaissance, Byron, Arena, GOM Shelf LLC, Walter, W&T, Cantium, and WYOTEX Offshore submitted bids for shelf leases.
Which independents will be the most active? Woodside and Murphy are large independents, and their participation was most impressive. Murphy submitted 14 high bids totaling $27.4 million. Woodside had 8 high bids including the sale’s two highest for a total of $38.1 million, second only to BP in terms of the sum of their high bids.
Bud's Offshore Energy (BOE) 