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Posts Tagged ‘California’

California offshore wind lease sale rolls on (sort of)

Posted in California, Offshore Wind, tagged , , on December 7, 2022| Leave a Comment »

After 20 rounds yesterday, the sale resumes today.

The biggest difference between the wind and the oil and gas programs may be the way the sales are conducted. For oil and gas leases, you submit a single sealed bid. Here is a simplified description of how a wind lease sale is conducted:

  • At the start of each round, BOEM will state an asking price for each Lease Area. A bid at the full asking price is referred to as a “live bid.”
  • If the bidder has qualified for a non-monetary credit, it will meet the asking price by submitting a multiple-factor bid—that is, a live bid that consists of a monetary (cash) element and a non-monetary credit.
  • To participate in the next round of the auction, a bidder is required to have submitted a live bid for one of the Lease Areas (or have a carried-forward bid) in each previous round.
  • As long as there are two or more live bids (including carried-forward bids) for at least one of the Lease Areas, the auction moves to the next round
  • If there was only one live bid (including carried-forward bids) or no live bids for a Lease Area in the previous round, the asking price would not be increased.
  • A live bid would automatically be carried forward if it was uncontested in the previous round, and the bidder who placed the uncontested bid would not be permitted to place any other bid in the current round of the auction.
  • Conversely, if a live bid was contested in the previous round, the bidder who placed the contested bid would be free to bid on any Lease Area in the auction in the next round, at the new asking price.
  • If a bidder decides to stop bidding before the final round of the auction, there are circumstances in which the bidder could nonetheless win a lease.
  • Between rounds, BOEM will disclose to all bidders that submitted bids: (1) the number of live bids (including carried-forward bids) for each Lease Area in the previous round of the auction.
  • In any round after the first round, a bidder may submit an “exit bid” only for the same Lease Area as the bidder’s contested live bid in the previous round. An exit bid is a bid that is greater than the previous round’s asking price, but less than the current round’s asking price.
  • The auction ends (finally) when a round occurs in which each of the Lease Areas in the auction receives one or zero live bids (including carried-forward bids), regardless of the number of exit bids on any Lease Area.

Perfectly clear? You can read the full description in the Sale Notice.

Is this the best way to award offshore wind leases?

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Interesting twist in Tuesday’s (Dec. 6) Pacific wind lease sale

Posted in California, energy policy, Offshore Wind, tagged , , , on December 5, 2022| Leave a Comment »

As a result of a provision in the Inflation Reduction Act, leases may be sold but not awarded. See the paragraph below that was inserted at the end of the sale notice. No wind leases may be issued until Sale 259 oil and gas leases are issued (presumably late next spring).

XV. Compliance With the Inflation Reduction Act (Pub. L. 117-169 (Aug. 16, 2022)(Hereinafter, the “IRA”):

Section 50265(b)(2) of the IRA provides that “[d]uring the 10-year period beginning on the date of enactment of this Act . . . the Secretary may not issue a lease for offshore wind development under section 8(p)(1)(C) of the Outer Continental Shelf Lands Act (43 U.S.C. 1337(p)(1)(C)) unless— (A) an offshore lease sale has been held during the 1-year period ending on the date of the issuance of the lease for offshore wind development; and (B) the sum total of acres offered for lease in offshore lease sales during the 1-year period ending on the date of the issuance of the lease for offshore wind development is not less than 60,000,000 acres.” Section 50264(d) of the IRA provides that “. . . not later than March 31, 2023, the Secretary shall conduct Lease Sale 259[.]” Conducting Lease Sale 259 is needed for BOEM to satisfy the requirements in section 50265(b)(2) of the IRA and issue the leases resulting from this lease sale. Notwithstanding the foregoing, nothing in the IRA prevents BOEM from holding this auction.

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Still waiting for the investigation report on the Huntington Beach pipeline spill, but Amplify settles with State and County governments

Posted in California, oil spill response, pipelines, Regulation, tagged , , , , on September 9, 2022| Leave a Comment »

In addition to the settlement with the Dept. of Justice, the pipeline operator has reached settlements with the State and County. In addition to a $4.9 million fine, the company agreed to inspection and leak detection measures similar to those in the Federal settlement.

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California says YES to offshore drilling…

Posted in California, energy policy, Offshore Energy - General, tagged , , , , on May 21, 2022| Leave a Comment »

Not really, but current economic and energy security realities doomed a bill to prohibit drilling and production in State waters. Strong quotes from bill opponents:

“SB 953 was held because it didn’t work — it was going to cost the state billions of dollars for a symbolic victory,” Andrew Meredith, president of the State Building and Construction Trades Council of California, said in a statement. “The California Senate is rightfully more concerned with actually improving the plight of workers and our environment than chasing headlines.”

Politico

“I think most legislators understand that every barrel of oil we don’t produce here under our strict environmental rules must be imported by foreign tankers floating offshore in our crowded ports from Iraq, Saudi Arabia, or the Ecuadorian rainforest,” California Independent Petroleum Association CEO Rock Zierman said in a text message.

Politico

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Workshop to advance California offshore decommissioning, April 21, 2022, Newport Beach

Posted in California, conferences, decommissioning, tagged , , on January 25, 2022| Leave a Comment »

Per our post about old disputes preventing common sense decommissioning solutions for offshore California facilities, we were pleased to learn that an Orange County Coastkeeper’s workshop will address the flaws in the California’s unworkable rigs-to-reefs program with the objective of advancing decommissioning programs.

Coastkeeper’s upcoming Retiring Offshore Rigs Summit, or ROR, comes roughly ten years after Coastkeeper’s Rigs to Reef Conference in 2010. While that conference succeeded in passing new decommissioning and artificial reef enhancement laws, the language was not workable. In the decade since that legislation, known as AB 2503, or the “California Marine Resources Legacy Act” was signed into law, it was never implemented by the state.

Orange County Coastkeeper

Link for further information on the workshop.

Previous posts on California decommissioning:

Platform Houchin, Santa Barbara Channel

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Eva joins the long list of shut-in platforms offshore California

Posted in California, Offshore Energy - General, pipelines, tagged , , on December 27, 2021| 2 Comments »

Boats survey behind the surf with oil rigs in the background.
LA Times
Courage stopped O.C. oil platform blowout – Orange County Register

Per the LA Times, a DCOR pipeline has been identified as the source of a sheen in California State waters near Bolsa Chica State Beach. The pipeline transports oil from Platform Eva. All platform and pipeline operations in the vicinity have ceased.

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California Decommissioning: old disputes prevent common sense solutions

Posted in California, decommissioning, energy policy, rigs-to-reefs, tagged , , on November 30, 2021| Leave a Comment »

Despite scientific support, California’s “rigs to reefs” program has made little progress. Comments in yesterday’s LA Times article help explain why:

Fed by concerns from some environmental advocates and a skepticism about the motives of California’s billion-dollar oil industry, the Rigs to Reefs program that passed in 2010 was so complicated by political compromise that the permitting process became almost unworkable, (State Sen.) Hertzberg said.

Not a single oil company has applied in the history of the program, according to the State Lands Commission, which has jurisdiction over state waters.

LA Times

“Oil companies want a clear path to compliance,” he said. “They’re operating in many cases at a loss, but it’s cheaper to operate at a loss than it is to face millions for decommissioning.”

Gary Brown, Orange County Coastkeeper

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Jerry Schubel on the benefits of rigs-to-reefs programs

Posted in California, decommissioning, energy policy, Offshore Energy - General, rigs-to-reefs, tagged , , , on November 2, 2021| Leave a Comment »

Veteran marine science advocate Jerry Schubel, former president of Long Beach’s Aquarium of the Pacific, is among those pushing for offshore oil platforms to be transformed for new ocean uses. He points out that the underwater portion of the structures already are a boon to marine life.

“They have enormous value as ecosystems because of the life that has grown on and around them,” he said.

He points out that other states have rigs-to-reefs programs — and California does as well, though it needs funding before it can function. Once the ball gets rolling, oil companies could be tapped to cover costs with fees drawn from the money they would save by not having to haul dismantled rigs ashore. Schubel estimated that turning platforms into reefs could cut decommissioning costs in half.

But Schubel says artificial reefs should be just the beginning. How about fish farms? Research labs? Windmills? Hotels for divers?

“The uses,” he said, “are limited only by our imagination.”

Orange County Register

Well said Dr. Schubel! For a full list of alternative uses for offshore platforms see the official Rigs-to-Reefs+++ page.

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Calls for the cancellation of Pacific OCS leases

Posted in accidents, California, Offshore Energy - General, pipelines, tagged , , , on October 22, 2021| Leave a Comment »

Never Let a Good Crisis Go to Waste - FocusCFO

A group of environmental organizations demanded Wednesday that the Biden administration suspend and cancel oil and gas leases in federal waters off the California coast after a recent crude oil spill.

NBC LA

While not the disaster that some had predicted, this spill is another setback for California offshore production. However, cancellation of the remaining producing leases would be a very difficult and costly proposition for the Federal government. At this time, the Beta Unit operator appears to be minimally responsible for the spill, so what would be the basis for cancelling those leases? Cancelling other producible leases would be even more problematic.

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CALIFORNIA OCS PLATFORM DECOMMISSIONING OUTLOOK AND CHALLENGES

Posted in California, decommissioning, Offshore Energy - General, tagged , , on September 24, 2021| Leave a Comment »

The piece small challenge
Platform Harmony Jacket

For those interested in California offshore decommissioning, attached is an excellent update presented at a 2020 forum by my former colleague John Smith.

jb-smith-aquarium-pacific-ppt-122919Download

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