Posts Tagged ‘offshore oil and gas’
Guyana Energy Brief – new edition
Posted in Guyana, Offshore Energy - General, tagged Guyana Energy Brief 2023, offshore oil and gas on February 21, 2023| Leave a Comment »
Atlantic whale deaths:Imagine the furor if there were oil and gas operations in the region
Posted in climate, energy policy, Offshore Energy - General, Offshore Wind, tagged Atlantic whale deaths, nonassociated gas, offshore oil and gas, Offshore Wind on February 20, 2023| Leave a Comment »
While it’s highly unlikely that wind turbine siting activities are responsible for the alarming number of whale deaths, some of the vociferous wind industry defenders would have been among the first to point the finger at oil and gas operations if there were any in the US Atlantic.
Some quotes from a recent USA Today article followed by BOE comments:
“It’s just a cynical disinformation campaign,” said Greenpeace’s oceans director John Hocevar. “It doesn’t seem to worry them that it’s not based in any kind of evidence.” (Comment: World class chutzpah on the part of Greenpeace, the master of disinformation.)
Gib Brogan, a campaign director with Oceana, an international ocean advocacy group, said those opposed to wind power are using a spate of whale deaths in the area as an opportunity. (Comment: Does Oceana suddenly find this type of opportunism to be shocking?)
“Groups opposed to clean energy projects spread baseless misinformation that has been debunked by scientists and experts,” said JC Sandberg, chief advocacy officer with the American Clean Power Association, a renewable energy trade group. (Comments: Use of the term “clean energy” is clever advocacy that serves to discredit other forms of energy. All energy sources have pros and cons, environmentally and otherwise. Wind and solar have significant visual, space preemption, navigation, wildlife risk, and intermittency issues, and are heavily dependent on subsidies and mandates. When all issues are considered, one could argue, as we have, that offshore gas, particularly nonassociated gas, is perhaps the environmentally preferred energy alternative.)
New BOEM Director: Liz Klein
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, Regulation, tagged BOEM, Liz Klein, offshore oil and gas, Offshore Wind on January 10, 2023| Leave a Comment »
Liz is an experienced attorney and leader in clean energy, climate change, and environmental law and policy. A member of the Biden-Harris administration since January 20, 2021, Liz has served as Senior Counselor to Secretary Haaland with an emphasis on water policy and climate change resilience. In this role, Liz also served as Chair of the Indian Water Rights Working Group, which manages, negotiates and implements settlements of water rights claims.
Prior to joining the Administration, Liz was Deputy Director of the non-partisan State Energy & Environmental Impact Center at NYU School of Law, which supports state Attorneys General addressing clean energy, climate, and environmental initiatives of regional and national importance. President Biden is the third President under which Liz has served at Interior, having worked for both the Clinton and Obama administrations. Under Secretaries Ken Salazar and Sally Jewell, Liz served as Interior’s Associate Deputy Secretary as well as Principal Deputy Assistant Secretary in the Office of Policy, Management and Budget. She was a key architect of the Obama Administration’s work to create a new offshore wind industry and leasing program.
DOI
Congratulations to Ms. Klein on being appointed to lead the Bureau of Ocean Energy Management. In addition to her commendable support for offshore wind energy, I trust that she appreciates the national importance of the OCS oil and gas program and the need for regular lease sales.
Despite big push from government, the offshore wind program struggles
Posted in energy policy, Offshore Energy - General, Offshore Wind, Uncategorized, tagged offshore oil and gas, Offshore Wind, synergy on January 2, 2023| Leave a Comment »
The wind program was intended to complement the oil and gas program, not replace it.
These articles highlight some of the challenges facing offshore wind:
2022 mid-year Compliance Honor Roll: US Offshore
Posted in Gulf of Mexico, Offshore Energy - General, tagged Arena, BHP, bp, Cantium, Chevron, compliance honor roll, Gulf of Mexico, Hess, Murphy, offshore oil and gas, Oxy, safety, Shell, Walter on July 20, 2022| Leave a Comment »
Operating companies (listed alphabetically): Arena, Anadarko (Oxy), BHP, bp, Cantium, Chevron, Hess, Murphy, Shell, and Walter
Criteria:
- Must average <0.3 incidents of compliance (INCs) per inspection. (This is less than half the GoM 2022 YTD average of 0.64 INCs/inspection.)
- Must operate at least 3 production platforms.
- Must have drilled at least one well.
- Pacific and Alaska operations will be considered in a separate post.
Comments:
- Impressive performance by Hess: 21 inspections and no INCs
- Cantium and Walter averaged less than 0.1 INCs/inspection. The INC rates for Anadarko (Oxy), BHP, and BP were only slightly higher.
- Among the Honor Roll companies, Shell (highest production, 9 deepwater platforms, and 13 well starts) and Arena (115 shelf platforms and 12 well starts) were the deepwater and shelf activity leaders.They thus had the highest INC exposure.
- Although CSI and FSI INCs are typically more significant than W INCs, that is not always the case, so the INCs have not been weighted by type.
- As has been previously noted, more inspection data should be readily available online. At a minimum, the specific INC (type) numbers (e.g. P-103, G-110, etc) should be posted so the public can better assess performance. Absent this information, interested parties are left to speculate about the significance of the violations.
- Incident data should also be considered in performance assessments. Unfortunately, the inexplicable lag in the posting of BSEE incident tables, precludes the use of these data in our analysis.
Compliance vs. Safety
While compliance is not synonymous with safety, most experienced observers believe there is a strong correlation. In the 1990’s, John Shultz, a PhD candidate at Carnegie Mellon Univ., studied US offshore facilities and safety data and developed expert and regression models to predict the likelihood of accidents and spills. That was a data rich era in that there were ~4000 US offshore platforms (more than twice the current number) and ~100 well starts/month (>10 times the current rate). In John’s thesis, he found that INCs are a very good predictor of accidents and spills. The offshore world has changed and further study of the correlation between compliance and safety performance is highly recommended.
The June 30, 2022 deadline for releasing the Proposed OCS Leasing Program has been missed without explanation
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged 5 year leasing plan, DOI, offshore oil and gas on July 1, 2022| Leave a Comment »
WASHINGTON (May 19, 2022) — During testimony before the U.S Senate Committee on Energy and Natural Resources today, Secretary of the Interior Deb Haaland confirmed that, despite delays in implementation from the previous Administration, the Interior Department will release the Proposed Program – the next step in the five-year offshore energy planning process – by June 30, 2022, which is the expiration of the current program. A Proposed Program is not a decision to issue specific leases or to authorize any drilling or development.
DOI
Will the Manchin – Schumer talks lead to a timely resumption of offshore oil and gas leasing?
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged leasing, Manchin, offshore oil and gas, Schumer on May 27, 2022| Leave a Comment »
There won’t be a deal without significant energy production provisions and Manchin is on the record regarding the need for action on offshore oil and gas leasing. We’ll see what happens.
500 days
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, Regulation, Russia, tagged 500 days since the last offshore lease sale, Lease Sale 257, offshore oil and gas, Senator Kelly, Senator Manchin on April 4, 2022| Leave a Comment »
500 days (and counting) since the last US offshore oil and gas lease sale. Abbreviated chronology:
- 11/18/2020 – BOEM holds Gulf of Mexico oil and gas lease sale 256 (listing of all offshore oil and gas leases sales); WTI = $41.64/bbl
- 1/27/2021 – President Biden issues EO 14008 which pauses all oil and gas leasing on Federal lands, onshore and offshore; WTI = $52.81/bbl
- 6/15/2021 – Federal court in the Western District of Louisiana issues a preliminary injunction blocking the administration’s leasing moratorium
- 7/1/2021: WTI price reaches 75.23/bbl
- 8/11/2021 – White House urges OPEC to increase oil production.
- 8/16/2021 – The administration appeals the Louisiana Federal court injunction that blocked the leasing pause
- 8/31/2021 – BOEM issues Record of Decision (ROD) to proceed with Sale 257 Concurrently, a suit is filed in DC Federal Court to block the sale. WTI= $68.43/bbl
- 9/30/2021 – BOEM announces Lease Sale 257 as necessary to comply with the order of the Louisiana Federal Court. DOI will “continue its comprehensive review of the deficiencies associated with its offshore and onshore oil and gas leasing programs.”
- Oct/Nov 2021 – Media coverage sensationalizes Sale 257, a typical GoM lease sale, by focusing on the sale area, of which the area receiving bids is just a small fraction.
- 11/15/2021 – Press Secretary Psaki: “We believe the (Louisiana court) decision is wrong, and the Justice Department is appealing it. So it’s in the courts; it’s in a legal process. We’re required to comply with the injunction. It’s a legal case and legal process, but it’s important for advocates and other people out there who are following this to understand that it’s not aligned with our view, the President’s policies, or the executive order that he signed.” WTI = $80.85/bbl
- 11/17/2021: Sale 257 bids opened and announced despite pending litigation. In a surprising twist, Exxon was the sole bidder on 94 carbon sequestration tracts offshore Texas. Neither the Notice of Sale nor the environmental review announced or assessed carbon sequestration operations in Federal offshore waters. BOEM/DOI have not commented publicly on the CCS bidding.
- 11/26/2021: DOI issues report on the Federal Oil and Gas Leasing Program. With regard to the offshore program, the report is rather moderate in tone and no new deficiencies are identified.
- 1/27/2022: Judge Contreras, DC Federal Court, vacates Sale 257. The Judge agreed with the plaintiffs’ assertion that BOEM failed to consider the effect that reduced production (and thus higher prices) would have on foreign consumption and the associated GHG emissions. The judge not only decided in favor of the plaintiffs, but ruled that BOEM’s omission was so serious that the lease sale had to be vacated. The judge reached this decision even though (1) the five year leasing plan expires in June leaving the timing of any future sale very much in doubt and (2) all of the sale 257 bids, which are based on proprietary assessments, are now public information, thus compromising the integrity of the leasing process at the next sale (if and when that occurs). WTI= $87.61/bbl
- 2/8/2022: API and the State of Louisiana appeal the Sale 257 decision.
- 2/24/2022: Russia invades Ukraine
- 2/28/2022: The Administration announces that it will not appeal the Sale 257 decision. WTI = $96.13
- 3/8/2022: WTI peaks at $123.70/bbl
- 3/30/2022: EIAP Report for API and NOIA estimates economic impacts from leasing program delays noting: In most cases, additional leases are required to produce an existing field fully or to underpin the economics of processing and transportation infrastructure. It is thus important for the industry to have continued opportunities to secure leases through a predictable leasing program. (US lease blocks are too small for optimal development in deepwater and frontier areas, increasing the importance of regular lease sales.)
- 3/31/2022: President Biden directs the release of 1 million bbls/day from the Strategic Petroleum Reserve for 6 months, lowering oil prices.
- 3/31/2022: Senators Manchin (D-WV) and Kelly (D-AZ) urge President BIden to develop and implement the new 5 year leasing plan without delay.
- 4/2/2022: 500 days since the last lease sale. WTI = $99.27
SPR Withdrawal and the US offshore oil and gas program
Posted in climate, energy policy, Gulf of Mexico, Offshore Energy - General, tagged Gulf of Mexico, offshore oil and gas, SPR release on April 1, 2022| Leave a Comment »
In addition to the obvious concerns about depleting the strategic petroleum reserve, further mortgaging our economic future, and increasing national security risks, the directive to withdrawal 1 million BOPD from the Strategic Petroleum Reserve for 6 months raises a few comments specific to US offshore production:
- The 1 million BOPD withdrawal is equivalent to ~60% of the daily production from the entire Gulf of Mexico offshore sector. How will this massive 6-month withdrawal will effect regional markets and logistics?
- Will the Dept. of Energy have to assess the GHG effects associated with their withdrawal of oil from the SPR? More specifically, will DOE be required to assess the increase in GHG emissions as a result of the increased foreign oil consumption that will result from the reduction in oil prices? This is what Judge Contreras ordered BOEM to do when he vacated Gulf of Mexico sale 257.
- If it’s okay to produce and consume oil from the SPR facilities (mapped below), why is new leasing and exploration being constrained in the adjacent Gulf of Mexico?
As oil prices soar along with energy security concerns….
Posted in climate, energy policy, Gulf of Mexico, Offshore Energy - General, Uncategorized, tagged energy security, Gulf of Mexico, Lease Sale 257, offshore oil and gas, oil prices on March 7, 2022| 2 Comments »
Remember that only 5 weeks ago Judge Contreras (DC Federal Court) vacated OCS Lease Sale 257 because BOEM didn’t analyze the benefits of higher oil and gas prices (as a result of lower US offshore production) in reducing international consumption and GHG emissions. The about that!
Lease Sale 257 wouldn’t have helped get us through this crisis, but would have most definitely reduced our vulnerability to future crises.
Bud's Offshore Energy (BOE) 