Archives for May 2018

Key markers point to possible turnaround for drilling

May 24, 2018 by Justin Williams

Daily Comet | Natalie Schwartz | May 23, 2018

Increasing crude oil prices and potential signs of growing interest in drilling in the Gulf of Mexico could signal the possibility of a turnaround in the offshore oil bust that has wounded the Houma-Thibodaux economy.

Scott Angelle, director of the federal Bureau of Safety and Environmental Enforcement, said there are several key markers for the oil and gas industry that suggest improvements, including increases in production rates, drilling rig activity and well permit approvals.

“I can say with a level of a confidence that it is turning around,” Angelle said. “I hear from many of the companies that they’re starting to feel much better about the Gulf of Mexico in 2018 than they did in, say, 2016.”

In recent weeks, crude oil has been trading above $70 per barrel, a benchmark that hasn’t been hit since 2014, when prices began to nosedive. Since then, Houma-Thibodaux has lost about 16,000 jobs.

“I’m not in the business of forecasting economic recovery,” Angelle said. “But I am here to say that I’ve been impressed on what I’m hearing ... on some of the things about the oil and gas industry and the Gulf of Mexico.”

Last year, U.S. offshore oil production increased by 6.25 percent over the course of the year, from 592.7 million barrels in 2016 to 629.7 million barrels in 2017. Gulf of Mexico rig activity levels have also been “steadily increasing,” according to a BSEE report, with 46 operating in the Gulf as of mid-May — levels that haven’t been seen in about two years.

Angelle, however, said he was most excited about increased well permit approvals. Fifteen deepwater permits were approved in April, bringing the total for the first four months of the year to 35, almost twice the number approved during the same time period last year.

“That’s a leading indicator that there’s some confidence that’s starting to come back,” Angelle said.

In April 2017, Trump signed an executive order that asked the bureau to reevaluate some regulations in the 2016 well control rule put into place after the Deepwater Horizon explosion, which claimed 11 lives and dumped more than 200 million gallons of oil into the Gulf.

Read the full story here.

Providing safer and smarter offshore regulations

May 24, 2018 by Justin Williams

The Advertiser | Scott Angelle | May 23, 2018

President Donald Trump made a commitment to make regulation smarter, more efficient, and less burdensome. At the Department of the Interior’s Bureau of Safety and Environmental Enforcement (BSEE), we’re working hard to keep his promise.

Recently, we proposed an update to regulations that cover offshore oil and gas drilling operations. In accordance with President Trump and Interior Secretary Ryan Zinke’s directives, we conducted a review of offshore regulations. Our mandate: Maintain the United States’ position as a global energy leader and foster energy security and resiliency for the benefit of the American people, while ensuring that operations are safe and environmentally responsible.

Our proposed rule incorporates industry innovation, best science, and best practices to improve reliability, safety, efficiency, and environmental stewardship in recommending revisions to what is known as the Well Control Rule.

While most regulations contain common-sense provisions – which we are leaving untouched – some were promulgated over strong objections and concerns voiced during the public comment period.

Our review of the Well Control Rule’s 342 provisions found that approximately 18 percent could be modified to make the regulations smarter by reducing unnecessary regulatory burdens, updating and clarifying certain sections of the regulations, and revising certain regulations that have led, or might lead, to unintended consequences — all while ensuring safety and environmental protection.

For example, our proposed revision aims to reduce the risk of multiple failure points, improve the lifespan of critical safety components, and implement other safety improvements, while also eliminating duplicated requirements and using a performance-based approach to meet real-time monitoring requirements.

In addition, BSEE compared each of the proposed rule changes to the 424 recommendations arising from the 26 separate reports from 14 different organizations developed in the wake of, and in response to, the Deepwater Horizon incident.

After conducting 78,440 specific analyses, the team determined that none of the proposed rule changes would ignore or contradict any of those recommendations, or alter any provision of the 2016 Well Control Final Rule (or any other rule promulgated following Deepwater Horizon) in a way that would make the result inconsistent with those recommendations.

Read the full op-ed here.

Scott Angelle is director of the federal Bureau of Safety and Environmental Enforcement.

NOIA Statement on Offshore Energy Industry Hurricane Preparedness

May 22, 2018 by Justin Williams

For Immediate Release: Tuesday, May 22, 2018
Contact: Nicolette Nye, (202) 465-8463, nnye@nullnoia.org

NOIA Statement on Offshore Energy Industry Hurricane Preparedness

Washington, D.C. – Ahead of the 2018 hurricane season, Tim Charters, NOIA Senior Director for Government and Political Affairs, participated in an energy industry joint press conference today on hurricane preparedness. His full statement, which expands on his remarks as delivered, follows:

“The 2017 hurricane season caused widespread damage and human suffering in the Atlantic and the Gulf of Mexico, and exposed the vulnerabilities and strengths of American energy security. Thankfully, in the Gulf of Mexico, offshore energy facilities faired remarkably well compared to onshore energy facilities, many of which suffered catastrophic damage from flood waters.

“At any given time, there are thousands of workers offshore producing energy and earning a living to support themselves, their families and communities. Despite the frequency and intensity of hurricanes and tropical storms in 2017, there were no reported deaths or injuries among offshore workers, no reported damage to offshore facilities and no reported spills from offshore facilities. This is a testament to how well the offshore industry prepares for and responds to hurricanes.

“Prior to the arrival of a hurricane offshore facilities are secured, and all personnel are evacuated in pre-determined stages. In addition, offshore companies provide critical support during disaster recovery efforts onshore. In the wake of Hurricane Harvey and Tropical Storm Nate, offshore companies provided support services, emergency funds, housing and other assistance to their employees, and donated millions of dollars to the Red Cross and similar organizations.

“The offshore energy industry has an enviable record of protecting the lives of its offshore workers and the safety record of industry in hurricane preparedness and response has been achieved consistently year after year. While we are proud of the offshore industry’s safety, environmental and philanthropic record, natural disasters like Harvey and Nate also expose the vulnerability of America’s energy security. Due in part to poor energy policy, and political NIMBYism, America has placed the vast majority of our offshore energy eggs in one basket – the hurricane-prone Gulf of Mexico.

“Energy companies working in the Gulf produce about 1.7 million barrels of crude oil and 3.2 million cubic feet of natural gas per day. The Bureau of Safety and Environmental Enforcement estimated that up to 24.5% of oil production and 26% of natural gas production from the Gulf was temporarily curtailed as a result of Harvey and several weeks later up to 92% of oil production and 77% of natural gas production was temporarily curtailed as a result of Nate. In addition, the flooding that followed slow-moving Harvey forced the closure of refineries along the Texas coast, taking offline 25% of the nation's crude oil refining capacity. Less than two weeks after Harvey, gasoline prices, including those from pumps thousands of miles away from the Gulf of Mexico, reached their highest level in two years.

“Hurricanes have the potential to strike the heart of the U.S. offshore energy industry and temporarily weaken our nation’s energy security; and this is one of the reasons why the National Ocean Industries Association (NOIA) has long advocated for increased access to federal offshore areas outside of the Gulf. Unfortunately, due to short-sighted federal policy decisions, only 6% of our nation’s outer continental shelf is currently accessible to the offshore oil and gas industry-- 94% is off limits.

“The success of the offshore energy industry has helped position the U.S. as the world leader in the production of oil and natural gas. However, the 2017 hurricane season revealed just how precarious that position can be. The lack of access to new sources of oil and natural gas outside of the Gulf of Mexico coupled with infrastructure that is centralized along the Gulf Coast, resulted in temporary shut downs in the energy delivery system for major population areas of the U.S. and a rapid rise of gasoline prices at the pump.

“Simply put, we dodged an energy security bullet during the 2017 hurricane season. By geographically concentrating our nation’s offshore energy production, the U.S. is rolling the dice when it comes to natural disasters. This is why we must ensure the continued development and production of our nation’s offshore energy resources from both inside of and outside of the Gulf of Mexico.

“Thankfully, the Trump administration re-opened the discussion about how we manage the energy sources off our coasts and is in the second stage of developing a new and more expansive National 5-Year OCS Oil and Gas Leasing Program that proposes to open new areas for exploration and potential development of vital resources to meet our nation’s energy demand and reduce our foreign imports. Decentralizing offshore energy sources will strengthen American energy security and economic security by ensuring production of offshore oil and natural gas continues, even if hurricanes or other natural disasters cause temporary disruptions from onshore and offshore energy producing areas.”

Please visit NOIA’s Hurricane Preparedness webpage for facts, figures and more information.

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ABOUT NOIA
NOIA is the only national trade association representing all segments of the offshore industry with an interest in the exploration and production of both traditional and renewable energy resources on the nation’s outer continental shelf. NOIA’s mission is to secure reliable access and a fair regulatory and economic environment for the companies that develop the nation’s valuable offshore energy resources in an environmentally responsible manner. The NOIA membership comprises about 250 companies engaged in business activities ranging from producing to drilling, engineering to marine and air transport, offshore construction to equipment manufacture and supply, telecommunications to finance and insurance, and renewable energy

NOIA Welcomes DOD Report on Eastern Gulf of Mexico Operations

May 10, 2018 by Justin Williams

For Immediate Release: Thursday, May 10, 2018
Contact: Nicolette Nye, (202) 465-8463, nnye@nullnoia.org

NOIA Welcomes DOD Report on Eastern Gulf of Mexico Operations

Washington, D.C. – National Ocean Industries Association (NOIA) President Randall Luthi today issued this statement on the Department of Defense’s report on Preserving Military Readiness in the Eastern Gulf of Mexico:

“NOIA welcomes the report on Preserving Military Readiness in the Eastern Gulf of Mexico, which not only provides a template for future coordination and consultation between the Department of Defense (DOD) and the Department of the Interior (DOI), but also is a starting point for a productive and cooperative relationship between the offshore energy industry and DOD. The report shows there is a lot of ocean out there and while there will be devils in the details, the overall message from the Pentagon should be interpreted as cooperation and coordination. In addition, as companies are allowed to explore and evaluate oil and natural gas plays, it is likely that areas of high potential will be more clearly defined and thus allow for additional military operations.

"The report identifies areas in the Gulf of Mexico where energy development activities can occur and as importantly, the very limited areas where DOD recommends they cannot. Military operations and energy development have co-existed and thrived in many areas in the Gulf of Mexico for decades under a 1983 Memorandum of Agreement between DOD and DOI, as evidenced by the roughly one-third of current Gulf leases including military training stipulations and restrictions. The report concludes that, with similar stipulations and restrictions mutually agreed on by DOD and DOI, critical military operations and essential energy development can co-exist and thrive in the eastern Gulf of Mexico as well.”

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Scientists warn against losing a crucial research ship: The National Science Foundation ‘has betrayed us’

May 8, 2018 by Justin Williams

Washington Post | Ben Guarino | May 8, 2018

Marine scientists are bracing for the loss of the world-class research vessel Marcus G. Langseth. The National Science Foundation plans to sell the 235-foot ship in 2020, according to a "Dear Colleague" letter published on the agency's website last month. Without a vessel to replace the Langseth, ocean seismologists fear their field will suffer.

“We’re not trying to save the Langseth at all costs,” said James Austin, a geoscientist at the University of Texas at Austin. “We’re trying to save deep-ocean crustal imaging.”

Deep-ocean crustal imaging is where the Langseth excels. It is no ordinary ship. Its sophisticated array of pneumatic guns generates a blast that bounces off the Earth's crust and penetrates dozens of miles into the planet. Unspooled behind the ship, miles of cables strung with microphones capture the blast's reflection. This sonic bounce creates maps of mid-ocean-ridge magma chambers and tectonic plate edges, features that are otherwise difficult, if not impossible, to survey.

“There really aren't any comparable vessels that are available to academic scientists,” said geophysicist Douglas Wiens, a professor at Washington University in St. Louis and chair of the Iris Consortium, a network of 100-plus universities that collect seismological data.

This ship has propelled “huge scientific advances” in marine seismology, he said. Marine imaging, for instance, helps scientists identify where underwater earthquakes could occur. Recent research conducted on the Langseth found a fault near the Alaskan coast similar to the fault responsible for the 2011 tsunami that devastated Japan and other areas across the Pacific.

In 2004, the NSF purchased the ship from a contractor for the drilling industry, which uses ships like the Langseth to locate oil and other natural resources. Over the next three years, dockworkers in Nova Scotia modified the vessel into a research platform, able to support a host of sensors and gadgetry.

The academic community had grand ambitions for the ship, said Sean Higgins, director of marine operations at Columbia University's Lamont-Doherty Earth Observatory, which runs the Langseth on behalf of the NSF. The ship, which accommodates 55 or so people, can make observations as varied as the salt content in seawater and the detection of nearby marine mammals. Researchers do not fire the ship's air guns when whales or dolphins are close, Austin said, to avoid harming the animals.

Read the full story here.