Greenfield Offshore Energy Report
Offshore Energy Development Is Critical to US Economic Growth and Energy Security
Below is a summary of publicly available activities currently underway at the federal, state and international levels that could impact the development of offshore oil and gas resources. With numerous legislative bodies now in session, HBW Resources is monitoring these activities to ensure that responsible policies based on sound science are advanced.
OCS Governors Discuss Importance Of Access, Regulatory Reform, and Revenue-Sharing
At a panel convened during the Offshore Technology Conference in Houston on Monday, six governors and senior staff for two governors from eight U.S. coastal states that currently comprise the Outer Continental Shelf Governors Coalition joined together to talk about challenges and opportunities for offshore energy development.
Governors Sean Parnell (AK), Rick Perry (TX), Robert Bentley (AL), Phil Bryant (MS), Nikki Haley (SC), and Pat McCrory (NC), as well as senior staff for Governors Bobby Jindal (LA) andBob McDonnell (VA) discussed, among other things, the importance of allowing greater access to offshore energy resources located in federal waters, better managing regulatory standards for offshore development to provide increased certainty and more efficient timelines for operators, and expanding federal revenue-sharing to all coastal states and removing the current cap.
The event was covered by media outlets including Rigzone, Fuel Fix, Offshore Energy Today,Associated Press, and Dow Jones, among others.
Interior Secretary Tours Gulf Of Mexico Offshore Drilling Rig and Production Platform
On Friday, U.S. Interior Secretary Sally Jewell and Bureau of Safety and Environmental Enforcement Director Jim Watson visited an ENSCO offshore drilling rig operated by LLOG and a Chevron production platform in the Gulf of Mexico.
While at the ENSCO rig, located roughly 120 miles southeast of New Orleans, Jewell observed a cementing operation for a production well and received a briefing on LLOG’s development plan.
At Chevron’s 6,500 foot water depth production facility located roughly 125 miles southeast of New Orleans, Jewell toured the production equipment and talked about the company’s deepwater exploration and production strategy for the Gulf.
Sec. Jewell said in part that “[o]il and gas production from the Gulf of Mexico plays an important role in powering our nation and strengthening our economy,” and that DOI “will continue to work with industry to ensure that these resources are developed safely and responsibly, while also delivering a fair return to the American taxpayer, businesses and communities.”
The offshore visits concluded a two-day trip to regional DOI offices overseeing oil and gas development in federal waters. Secretary Jewell earlier told employees “[m]aintaining the public’s trust in the safety and environmental performance of oil and gas production is critically important as we continue to tap into the Gulf’s abundant resource potential,” adding that she has “immense admiration and respect for your efforts to carry out aggressive restructuring and strengthening of the oil and gas regulatory system.”
BSEE-Directed Deepwater Oil & Gas Containment Exercise Successfully Completed
The Bureau of Safety and Environmental Enforcement (BSEE) on Tuesday announced thatBSEE, Noble Energy, and Helix Well Containment Group (HWCG) have successfully completed a full-scale deployment of well control equipment to the Gulf of Mexico’s ultra-deep seabed to examine Noble’s ability to respond to a potential deepwater subsea blowout.
The unannounced drill began April 30 and involved HWCG’s capping stack system, of which Noble Energy serves as the designated operator. The capping stack was deployed by wire to a seafloor depth exceeding 5,000 feet and then latched to a test wellhead and successfully pressurized. BSEE inspectors, engineers, and spill response experts were on the scene throughout and oversaw the system’s mobilization, deployment, and tests.
BSEE Director James Watson said in part that “[d]eployment drill exercises like this one are essential to supporting President Obama’s commitment to the safe and responsible development of offshore resources.”
Noble Energy Senior Vice President John Lewis added that the success of the drill was “enabled by collaborative communication and planning between the industry and regulatory agencies with a focus on solutions-based outcomes.”
According to HWCG Commercial Director Roger Scheuermann, HWCG’s “ability to quickly and effectively respond to a call from Noble Energy and every operator in our consortium is made possible by a combination of the mutual aid agreement committed to by each consortium member and the contacts we have in place for equipment that is staffed and working in the Gulf each day.”
A similar test was successfully completed by the Marine Well Containment Company last year.
NOAA Releases Draft 2013-2017 R&D Plan For Public Comment
NOAA on Tuesday announced that the agency’s draft 5-Year Research and Development Plan for 2013-2017 is now available for public comment.
The draft Plan includes goals, objectives, and targets related to climate adaptation and mitigation, a weather ready nation, healthy oceans, resilient coastal communities and economies, stakeholder engagement, environmental data, and environmental modeling.
Objectives and targets of interest include the following:
- Determine the effects of increasing emissions in different regions of the U.S. (e.g. urban emissions, and oil and natural gas development activities emissions) on climate and regional air chemistry (target for objective to improve understanding of the changing atmospheric composition of 909 long-lived greenhouse gases and short-lived climate pollutants)
- Strengthen oil-spill response capabilities. NOAA will play a scientific advisory and support role to the Federal On-Scene Coordinator during Arctic oil spill and clean-up responses, as it does in other U.S. regions. The need for this capacity is urgent due to increased Arctic offshore drilling and maritime transit activities, and events such as the Japanese tsunami (objective)
- Apply genomics- and proteomics-based markers of exposure to petroleum and its effects on animals at the molecular level, with emphasis on marine mammals and protected species (target for objective to strengthen oil-spill response capabilities)
- Document the likely movement, weathering and fate of crude oil trapped under sea ice and its likely effects of coastal ecosystems (target for objective to strengthen oil-spill response capabilities)
- Characterize the distribution of biological resources and the associated key coastal habitats of the Chukchi Sea with maps of sediment distribution, background levels of oil and gas development-related contaminants, and potential toxicity (target for objective to improve characterization of Arctic marine ecosystems)
- Identify areas of special value and vulnerability to offshore petroleum development and coastal infrastructure by applying NOAA’s Biogeography Assessment Framework (target for objective to improve characterization of Arctic marine ecosystems)
- Provide baseline characterization information for the establishment of marine protected areas for sensitive deep-sea coral ecosystems in the Atlantic, Pacific and Gulf of Mexico (target for objective to transition ocean exploration discoveries to the rest of NOAA and other agencies)
- Explore mid-Atlantic deepwater hard bottom habitats and shipwrecks with emphasis on canyons and coral communities as part of a joint project with the Bureau of Ocean Energy Management (target for objective to transition ocean exploration discoveries to the rest of NOAA and other agencies)
- Characterize marine archaeological discoveries of cultural or archaeological significance (target for objective to transition ocean exploration discoveries to the rest of NOAA and other agencies)
- Identify undiscovered areas of the ocean with potential high concentrations of economic assets (target for objective to discover and characterize new ocean resources)
- Locate new underwater cultural and archaeological heritage sites in U.S. territorial waters for Federal management (target for objective to discover and characterize new ocean resources)
Comments are due by Monday June 3, 2013 and may be submitted here.
Rigs-To-Reef/Oil Spill Coral Threat On GOM Fishery Management Council Meeting Agendas
NOAA on Friday announced that the Gulf of Mexico Fishery Management Council’s Shrimp Advisory Panel (Panel) will hold a public meeting in Tampa, FL on May 23, 2013. As part of a discussion of other business, the Panel will talk about the siting and locations of decommissioned oil and gas platforms as part of the Rigs-to-Reef Program.
NOAA also announced on Friday that the Council will convene a public workshop of subject matter experts on interrelationships between coral reef and fisheries in Tampa, FL from May 20-22, 2013. According to the announcement, the workshop will examine topics regarding links between corals and fisheries, management, threats and consequences, and future research, including a review and discussion of the “various threats to coral/fishery health” including oil spills.
Senate Passes Amendment Authorizing National Ocean Endowment Fund
In a 68-31 vote, the U.S. Senate on Wednesday passed an amendment to the Water Resources Development Act of 2013 (S. 601) that would authorize but not fund the establishment of a National Endowment for the Oceans designed to “promote the protection and conservation of United States ocean, coastal, and Great Lakes ecosystems.”
Under the terms of the amendment introduced by Sen. Sheldon Whitehouse (D-RI), at least 39% of available Endowment funds would be allocated to a grant program whose eligible recipients would include regional planning bodies established under the National Ocean Policy Executive Order, states, Indian tribes, associations, NGOs, and academic institutions.
In addition, at least 59% of available funds would be allocated to coastal states through grants, and at least 2% of the funds would be allocated for administrative expenses.
The overall bill that the amendment is attached to faces a vote in the Senate as well as action in the House. For the Endowment to be put to use, Congress would also need to authorize revenues through the appropriations process since the amendment does not include a funding mechanism.
NOAA Extends Deadline For Ocean Exploration Advisory Board Nominations
NOAA on Tuesday announced that it is extending the deadline for the receipt of nomination applications to fill vacancies on the Ocean Exploration Advisory Board (Board), a federal advisory committee established pursuant to the Omnibus Public Land Management Act of 2009.
Although the original deadline for nominations was December 28, 2012, NOAA says that it decided to extend the deadline to June 6 “to achieve balance across the diverse sectors of the ocean economy.”
In addition to advising the NOAA Administrator on (1) priority areas for survey and discovery; (2) the development of a 5-year strategic plan for ocean, marine, and Great Lakes science, exploration, and discovery; and (3) the quality and effectiveness of the proposal review process, the Board will provide advice on the relevance of NOAA’s Ocean Exploration Program with regard to the National Ocean Policy Implementation Plan, the NOAA Strategic Plan, and other “relevant guidance documents.”
The Board will be comprised of roughly 10 members, including a Chair and Co-Chair, who will be appointed to 3-year terms (renewable once). Initial appointments include 4 members with an initial 3-year term, 3 members with an initial 4-year term, and 3 members with an initial 5-year term.
Consideration given to candidates who are experts in fields relevant to ocean exploration, including ocean scientists, engineers and technical experts, educators, social scientists, and communications experts, and members will be appointed as special government employees (SGE) and will be subject to SGE standards. Outside of the subcommittee, task force, and working group meetings, the Board will meet twice per year.
Applications must be received by 5:00 p.m. Eastern on Thursday, June 6, 2013, and information on what and how to file is available here.
Methane Hydrate Advisory Committee To Hold Public Meeting
The Energy Department’s Office of Fossil Energy on Monday announced that the Methane Hydrate Advisory Committee will hold a public meeting in Washington, D.C. on Thursday, June 6, 2013.
According to the announcement, the Committee will discuss data and results from the FY2012 Arctic production test, receive updates on the Bureau of Ocean Energy Management’s Lower 48 assessment and international activity, and talk about FY 2013 methane hydrate program activities and plans, the methane hydrate program budget, methane hydrate program strategic direction, a draft interagency roadmap, and results from a Consortium for Ocean Leadership workshop.
The Committee, which was established pursuant to the Methane Hydrate Research and Development Act of 2000 and meets biennially, is tasked with advising the Energy Secretary on potential applications of methane hydrate, assisting with the development of recommendations and priorities for the methane hydrate R&D program, and submitting to Congress one or more reports on an assessment of the research program and the DOE 5-year research plan.
28 Restoration Projects Proposed For Gulf Of Mexico
The U.S. Interior Department on Thursday announced a preliminary agreement between the Deepwater Horizon Oil Spill Natural Resource Damage Assessment Trustees (Trustees) and BP to identify 28proposed Gulf of Mexico restoration projects in Texas, Louisiana, Mississippi, Alabama, and Florida that would be funded with nearly $600 million.
In Texas, projects would involve construction of an artificial reef at existing permitted reef sites along the mid or upper Texas coast ($1.8 million), enhancement of a nearshore artificial reef site off Freeport ($2 million), construction of new nearshore artificial reef site off Matagorda ($3.5 million), facility improvements at Sea Rim State Park ($210,000), and recreational enhancements on the Gulf side of Galveston Island State Park ($10.7 million).
Louisiana projects would address barrier island restoration to restore beach, dune, and marsh habitat ($320 million) and the establishment of two marine fishery enhancement, research, and science centers in Calcasieu Parish and Plaquemines Parish ($22 million).
In Mississippi, projects would involve 92 acres of living shoreline construction in Hancock County ($50 million), construction of wetland walkways, viewing structures, piers, indoor exhibits, a greenhouse/nursery, and interpretive centers at INFINITY Science Center in Hancock County ($10.4 million), construction of an interpretive center in Harrison County ($4.7 million), construction of concrete pathway with benches, shower stations, fire pits, sculptures, fishing areas, and a playground at Pascagoula Beach ($3.8 million).
Alabama projects would address Gulf State Park enhancements ($85.5 million), oyster reef restoration ($3.2 million), and oyster breakwater /living shoreline construction ($5 million).
In Florida, projects would involve restoration of the Perdido Key Dune ($600,000), breakwater construction in Pensacola Bay ($11 million), sea grass bed restoration in Florida Bay ($2.7 million), breakwater construction in St. George Sound ($800,000), oyster reef restoration in the Pensacola, St. Andrew Bay, and Apalachicola Bay systems ($5.4 million), saltwater sportfish hatchery construction in Escambia County ($20 million), scallop enhancement for recreational fishing in the Florida Panhandle ($3 million), nearshore and offshore artificial reef creation and restoration in the Western Florida Panhandle ($11.4 million), Gulf Island National Seashore beach enhancement ($11 million), boat ramp improvement in Big Lagoon State Park ($1.5 million), restoration of Bob Sikes Pier ($1 million), ferry boat access to Gulf Island National Seashore ($4 million), Perdido Key boardwalk improvements ($600,000), and sand replenishment at Shell Point Beach ($800,000).
In the coming months, the Trustees will seek public review and comment on the new proposed early restoration projects.
Following the Deepwater Horizon incident, BP agreed to provide up to $1 billion to fund early restoration projects in the Gulf of Mexico. The Trustees and BP have previously agreed on the identification and funding of ten other early restoration projects totaling roughly $71 million, some of which have already begun implementation.
Jewell Announces Members Of Climate Change & Natural Resource Science Advisory Cmte.
Interior Secretary Sally Jewell on Wednesday announced the members of a new Advisory Committee on Climate Change and Natural Resource Science (Committee).
The 25-member Committee, comprised of government, NGO, academic, and private sector representatives, is to provide advice on matters related to the creation of the U.S. Geological Survey National Climate Change and Wildlife Science Center and the DOI Climate Science Centers.
Specifically, the Committee will advise on matters including:
(1) the contents of a national strategy identifying key science priorities related to the management of natural resources;
(2) relations and engagement with “key” regional Climate Science Center-level partners;
(3) identification of key priorities from management partners and delivery of scientific results in “useful” forms;
(4) ensuring high scientific quality and integrity standards in National Climate Change and Wildlife Science Center products;
(5) the review and evaluation of individual Climate Science Centers; and
(6) coordination as appropriate with Federal Advisory Committees established for DOI Landscape Conservation Cooperatives
Secretary Jewell said that the Committee “embodies our commitment to working closely with our partners to strengthen our efforts to develop sound science that will help inform policymakers, land managers and the public in making important resource management decisions.”
Deputy Interior Secretary David Hayes added in part that the Committee “will play an important role in the department’s climate adaptation strategy by providing advice on critical issues such as science priorities, relations with key partners, ensuring scientific excellence and coordinating with other climate adaptation initiatives.”
For additional information, contact Brent Greenfield with HBW Resources. His contact information is below.
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