Sharing pictures from John Smith’s excellent decommissioning presentation at the Western States Petroleum Assoc. luncheon in Santa Barbara in May. You can view or download the presentation here.
Posts Tagged ‘decommissioning’
Pictures from John Smith’s decommissioning presentation in Santa Barbara
Posted in California, decommissioning, Offshore Energy - General, rigs-to-reefs, tagged decommissioning, John Smith, reefing, rigs to reefs, Santa Barbara blowout on June 27, 2025| Leave a Comment »
John Smith’s presentation at 5/15 WSPA luncheon in Santa Barbara
Posted in California, decommissioning, energy policy, Offshore Energy - General, tagged artificial reefs, California, decommissioning, John B Smith, legislation on May 21, 2025| Leave a Comment »
John Smith’s excellent decommissioning presentation at the recent Western States Petroleum Assoc. luncheon in Santa Barbara is attached. John used an amended version of Bob Byrd’s OTC powerpoint, adding slides on the proposed California Marine Legacy Act amendments.
For those who have been following the Santa Ynez Unit story, Harmony, Heritage, and Hondo are the platforms in that unit. Platform Harmony, where production resumed on the date of John’s presentation (5/15), is in 1198′ of water and is one of the world’s largest offshore structures.
“Idle Iron Decommissioning Offshore California and the Need to Amend Reefing Legislation”
Posted in California, decommissioning, energy policy, Offshore Energy - General, Regulation, tagged artificial Reefing plan, California, decommissioning, idle iron, John B Smith, rigs to reefs on May 6, 2025| Leave a Comment »
John Smith shared an outstanding paper (attached) that was presented by co-author Robert Byrd at the SPE Regional Meeting in Garden Grove, CA last week.
John Smith: “My objective in writing the paper is to hopefully spur legislators to recognize the benefits of reefing and the legislative fixes required to facilitate reefing and the removal of aging infrastructure. The California Department of Fish and Wildlife Habitat Lead was very complimentary of the paper and has distributed it to the Interagency Team which is developing a California Artificial Reefing Plan.”
John adds: “They are in the process of creating a statewide artificial reef plan and you can sign up for updates and get more information. The California Artificial Reef Program (CARP) Plan won’t discuss the specifics of Rigs-to-Reefs but will be compliant with the National Fisheries Enhancement Act and National Artificial Reef Plan and meet the BSEE requirement of having an adopted state artificial reef plan. The intent is to add an addendum to the plan when resources become available to move Rigs-to-Reefs forward in California. You can check out the latest program update that further discusses the CARP Plan and Rigs-to-Reefs.”
Why timely well plugging and financial assurance rules must be strictly enforced!
Posted in decommissioning, energy policy, Gulf of Mexico, Offshore Energy - General, Regulation, well control incidents, tagged 82 year old well, decommissioning, financial assurance, Louisiana, Plaquemines Parish, Spectrum Energy, US Coast Guard, well blowout on May 5, 2025| Leave a Comment »
In what the Coast Guard is describing as an “uncontrolled discharge” (euphemism for blowout), an 82-year-old oil well has been spewing oil, gas, and water into the coastal marshes of southern Plaquemines Parish, Louisiana, for more than a week.
In hopes of future production, prior and current owners had elected not to permanently plug the well, apparently with the State’s acquiescence.
The well is currently operated by an affiliate of Spectrum Energy. Typical of these situations, the previous owner, Whitney Oil and Gas, was in bankruptcy.
The Coast Guard has taken over the response and has accessed the Oil Spill Liability Trust Fund.
We don’t need relaxed decommissioning and financial assurance requirements. We need a cooperative Federal, State, and industry effort to ensure that wells are plugged in a timely manner and that financial assurance is provided to protect the public interest.
DOI intends to revise offshore financial assurance rule. Is this cause for concern?
Posted in decommissioning, energy policy, Offshore Energy - General, Regulation, tagged BOEM, decommissioning, Department of the Interior, financial assurance on May 3, 2025| Leave a Comment »
The U.S. Department of the Interior today (5/2/2025) announced its intent to “update” the Bureau of Ocean Energy Management’s 2024 Risk Management and Financial Assurance for OCS Lease and Grant Obligations Rule.
Those who are concerned about minimizing the Federal government’s decommissioning risk exposure should closely monitor this process. Some companies and their political allies have sought to minimize the financial risks associated with plugging wells and removing facilities. As a result, it has been necessary to defend BOEM from unwarranted commentary about decommissioning issues and the financial assurance rule. Stay tuned!
SECRETARIAL ORDER NO. 3418: Unleashing American Energy
Posted in decommissioning, energy policy, Offshore Energy - General, Regulation, tagged 5 year leasing plan, bop requirements, decommissioning, Doug Burgum, financial assurance, SECRETARIAL Order 3418, US Dept. of the Interior, well contro on February 5, 2025| Leave a Comment »
Of particular interest are mandated reviews of the:
- RIsk Management and Financial Assurance Rule: Those who want to gut this rule should come to the table with proposals that better protect the taxpayer from decommissioning liabilities. Pretending that decommissioning financial risks don’t exist or that they are someone else’s (or the govt’s) problem is unacceptable.
- 5 Year leasing program – This review is urgently needed. See this and this!
- BOP/Well Control Rule – This keystone safety rule has undergone multiple reviews in recent years. Because of the rule’s importance, further review for continuous improvement purposes may nonetheless be warranted. Here are the blog comments on the current version of the rule.
Not on the list, but should have been: A review of the fragmented regulatory regime for offshore pipelines, and the outdated and inconsistent regulations.
There was one US OCS fatality in 2024
Posted in accidents, decommissioning, Gulf of Mexico, Offshore Energy - General, tagged 2024, crane safety, decommissioning, Helix, OCS fatality, Talos, Triton Diving Services, wrongful death on January 9, 2025| Leave a Comment »
After a zero fatality year in 2023, the first in at least 60 years, Jason Mathews of BSEE advises that one worker was killed during US OCS oil and gas operations in 2024.
The fatality occurred during decommissioning operations on the Helix D/B EPIC HEDRON at Talos Energy’s Ship Shoal Block 225 “D” platform in the Gulf. The platform was to be reefed in Eugene Island Block 276.
The victim, who worked for Triton Diving Services, was moving hoses on the port side of the barge and got caught between the bulwark and counterweight of the crawler crane (see picture below).
The victim’s family have filed a wrongful death lawsuit against Helix Energy Services and Triton Diving Services. The plaintiffs assert that prior to the crane movement the crane operator and crew had not undertaken measures to assure that the crane’s swing area was clear of other crew members. Per their filing, Triton and Helix were negligent as follows:
They further assert that:
The incident remains under investigation by BSEE.
W&T sues insurers and related decommissioning comments
Posted in decommissioning, energy policy, Gulf of Mexico, Offshore Energy - General, Offshore Wind, Regulation, tagged BOEM, BSEE, decommissioning, financial assurance, Gulf of Mexico, lawsuit, Matagorda Island, W&T on December 17, 2024| Leave a Comment »
W&T (lease and facility map above) claims that insurers have colluded to damage the company by jointly demanding additional collateral and premiums.
Comments on excerpts from the W&T press release follow:
“At the heart of the dispute are rules from the federal Bureau of Ocean Energy Management – BOEM – which require energy producers in the Outer Continental Shelf to provide a bond to pay for well, platform, pipeline and facilities cleanup if the operating company fails to do so.”
Comment: Despite disagreeing with aspects of the BOEM financial assurance rule, this blog has defended the rule against unfair criticism. Better solutions are achievable, but that will require industry leaders from all factions to come to the table with a commitment to reach a balanced agreement that protects the public interest.
“These insurance companies and their unreasonable demands for increased collateral pose an existential threat to independent operators like W&T.”
Comment: If insuring offshore decommissioning is so risk-free and lucrative, why aren’t other companies entering the market?
“Several states, including Texas, are challenging the BOEM rule and in one case they specifically cite W&T as an example of how the rule could be misused to irreparably harm energy producers.“
Comment: As previously posted, the concerned States should propose alternative solutions that would promote production while also protecting taxpayer interests. Arguing that decommissioning financial risks are not a problem is neither accurate nor a solution.
“In over 70 years of producer operations in the Gulf of Mexico, the federal government has never been forced to pay for any abandonment cleanup operations associated with well, platform facility, or pipeline operations.”
Comment: Shamefully, from the standpoints of both the offshore industry and the Federal government, that statement is no longer true. The taxpayer has now funded decommissioning operations in the Matagorda Island Area offshore Texas (BSEE photo below) and more significant decommissioning liabilities loom.
Other thoughts:
- To what extent, if any, has W&T’s acquisition of certain Cox assets contributed to their increased insurance costs?
- My comments and John Smith’s comments on the BOEM’s draft financial assurance rule, which was essentially unchanged when published in final form, are relevant to this discussion.
- Also noteworthy in this discussion are BOEM’s lax financial assurance requirements for wind facility decommissioning. Has BOEM’s promotion of offshore wind influenced their financial assurance decisions, increasing the risks to taxpayers in the process?
Will the Chumash Marine Sanctuary designation further complicate California OCS decommissioning? Santa Ynez Unit production restart?
Posted in California, decommissioning, Offshore Energy - General, Regulation, tagged Chevron, Chumash Marine Sancturary, decommissioning, FMC, Sable Offshore, Santa Ynez Unit on October 23, 2024| Leave a Comment »
Almost 40 years ago, four large oil and gas platforms were installed in the beautiful offshore area that was part of our Santa Maria District (Pacific Region of the Minerals Management Service). Those platforms are now within the boundaries of the Chumash Heritage National Marine Sanctuary (see map above).
We watched those platforms being installed, inspected the drilling and production operations, and performed a myriad of other duties including the curtailment of offshore operations prior to launches from Vandenberg AFB. Those Vandenberg launches weren’t always perfect as this link clearly demonstrates. Even knowing that, it was still a bit unnerving when missiles were recovered during post-abandonment site clearance trawls.
All four of those Santa Maria District platforms are now on terminated OCS leases. All were installed by companies that are now part of Chevron Corp. (Chevron, Texaco, and Unocal). They are currently maintained by Freeport-McMoRan Oil & Gas, with Chevron retaining financial responsibility for decommissioning.
| Platform | Install yr. | installed by | water depth (ft) | Est. removal weight (short tons) | wells drilled |
| Harvest | 1985 | Texaco | 675 | 35,150 | 19 |
| Hermosa | 1985 | Chevron | 603 | 30,868 | 13 |
| Hidalgo | 1986 | Chevron | 430 | 23,384 | 14 |
| Irene | 1985 | Unocal | 242 | 8,762 | 26 |
BSEE reports that the 46 wells on Harvest, Hermosa, and Hidalgo have been plugged and tested, and that the well conductors have been removed. No information has been posted on the status of the wells at Platform Irene, but presumably they are (or will soon be) plugged in accordance with BSEE regulations.
Will the inclusion of these platforms in the Chumash Marine Sanctuary further complicate the already difficult decommissioning process? Decommissioning specialist John Smith thinks it may:
“In addition to the BOEM and BSEE approval process, Chevron and FMC are going to be dealing with the NOAA permitting regime for Sanctuaries. Those permitting and environmental compliance requirements are extensive. NOAA’s NEPA documentation for West Coast marine sanctuaries will also need to be amended to include the Chumash.”
So the “Mission Impossible” that is California OCS decommissioning now has yet another complex regulatory element.
John also thinks the Sanctuary designation presents yet another obstacle for Sable’s plans to restart Santa Ynez Unit production:
“Even though most of the SYU facilities are outside the Sanctuary, the proximity of the operations to the Sanctuary is problematic. The Chumash are now going to be a co-manager of the Sanctuary, adding another player in the process. Sable is going to obtain multiple Federal, State and local permits to restart SYU, and law suits are likely at every stage of the process.”
BOE will be watching!
Platform Holly story continues 9 years after production ceased
Posted in California, decommissioning, Offshore Energy - General, tagged bp, decommissioning, Exxon, natural seeps, Plains, Platform Holly, Refugio pipeline spill, Santa Barbara, State Lands Commission, UCSB, Venoco on September 19, 2024| Leave a Comment »
Platform Holly sits immediately offshore from the Univ. of California at Santa Barbara, and UCSB scientists have studied the platform and surrounding ecology extensively. Multiple studies have shown that production from Holly reduced natural seepage and methane pollution from shallow formations beneath the Channel. Platform Holly was thus a “net negative” hydrocarbon polluter.
The natural seepage in the Santa Barbara Channel was important to the earliest inhabitants of the area. The Chumash used the tar for binding and sealing purposes, including caulking their canoes. Since Holly shut down in 2015 following the Refugio pipeline spill, offshore workers and supply boat crews have reported a considerable increase in gas seepage.
Earlier this month, it was reported that well plugging operations at Holly had now been completed, but decisions regarding the final decommissioning of the platform remain.
Venoco declared bankruptcy in 2015 and the State of California became the platform owner. According to the State Lands Commission, Exxon will pay the costs for decommissioning the platform. This is because Exxon acquisition Mobil operated the platform from 1993-1997 before Venoco became owner.
The most recent Holly development is that Venoco has settled its law suit with Plains, the company responsible for the 2015 Refugio pipeline spill that halted production from Holly. Terms of the settlement have not been disclosed.
Note: As an aside, I’m curious as to whether Mobil provided a decommissioning guarantee as part of the sale to Venoco or whether the State is simply holding ExxonMobil accountable as a legacy owner. If it’s the latter, why isn’t bp (bp acquisition Arco was Holly’s operator from 1966-1993) also liable? Is it a matter of Mobil being the more recent predecessor owner?
Bud's Offshore Energy (BOE) 