Salazar defends proposed 5-year OCS plan before House panel

The US Department of the Interior proposed a 5-year Outer Continental Shelf program that concentrates on the central and western Gulf of Mexico after the 2010 Macondo well incident showed the oil and gas industry could not effectively handle a major incident and spill, Interior Secretary Ken Salazar told a US House committee on Nov. 16.

“It’s important for this committee, Congress, and the United States not to have amnesia about the Deepwater Horizon incident,” he told the Natural Resources Committee, adding that the central and western gulf are the best-known OCS areas with the most systems.

DOI kept working on a 2012-17 proposal amid calls to completely shut down OCS oil and gas activity following the 2010 accident that took 11 lives and set off a massive oil spill, Salazar said later in the hearing.

“At the end of the day, we know that developing oil and gas in the world’s oceans is not a risk-free activity. That’s why we’ve led the nation’s largest overhaul of its offshore oil and gas development regulations,” the secretary said. “Some members on my staff have worked 18 hr/day, 6 days/week, to make sure we have the right kind of leasing program where we can move forward.”

Committee Republicans were skeptical. Chairman Doc Hastings (R-Wash.) noted in his opening statement that both Congress and then-US President George W. Bush lifted decades-long US offshore drilling bans in 2008, creating new oil and gas leasing and development opportunities off the Atlantic and Pacific coasts.

Missed opportunities

“Unfortunately, these opportunities have been missed by this administration, he continued. “[It has] ignored the bipartisan will of both Congress and the American people to allow for new drilling off our coasts. The Obama administration’s draft plan only allows lease sales in areas that were previously open, and it indefinitely delays the Virginia lease sale scheduled to take place last year. With this, the president has effectively put the moratoriums back in place.”

Salazar said a lease sale off Virginia was not part of the proposed 2012-17 OCS program despite bipartisan support from its governor and most of its congressional delegation because the US Department of Defense raised significant questions about possible conflicts with military operations in the area. More time also is needed to evaluate potential resources along the Mid-Atlantic OCS with modern technology, he added. “We believe running seismic will help us develop information in an area when there’s been a dearth,” he said.

Committee member Robert Wittman (R-Va.) urged Salazar to move more quickly to resolve coordination issues DOD raised. “It seems to me these issues can be taken up in a fairly timely manner and not spread out over the next 5 years,” he told the secretary. “I have spoken to US Navy officials who say they would like to get moving on it.”

Salazar said in his prepared testimony that while most of the proposed 5-year OCS program’s lease sales are in the gulf, two have been proposed in the Arctic, “where we must proceed cautiously, safely, and based on the best science available.” The sales would not take place until late in the program so DOI can properly evaluate their potential impacts and assure that the necessary accident and spill response infrastructure is in place, he said.

Tommy P. Beaudreau, director of the new US Bureau of Ocean Energy Management, told the committee that the agency plans to spend millions of dollars for research on climate change, marine mammal migration, ocean currents, and other issues. “All of this information is necessary as development in the Arctic proceeds,” he said. “The scale of this development will depend on our evaluations. We will make those decisions at an appropriate time in the leasing schedule.”

Conditional permits

Another committee member, Niki Tsongas (D-Mass.), who mentioned that she has introduced a bill that would require companies drilling offshore to have a worst-case spill scenario as part of their plans, said that Shell Exploration Co.’s plan for its Arctic leases envisioned responses in August, when conditions would be most favorable. Beaudreau responded that Shell’s permits included a condition requiring it to satisfy BOEM that its spill response capabilities would be adequate in any season.

Deputy US Interior Sec. David J. Hayes also is overseeing a multiagency effort coordinating governmental agencies’ reviews of Shell’s drilling plans, BOEM’s director said. “There are challenging circumstances there,” he observed. “The regulations set a very high bar to spill response. Close attention must be paid to challenges in the Arctic.”

Other Republicans on the committee questioned whether companies would be willing to fund seismic research of areas presently not part of the proposed 5-year OCS program if lease sales aren’t scheduled. They also said that Salazar’s references to strong activity in the gulf ignored the fact decisions in previous administrations made it possible. “The average time period from a lease sale to first production is 9.5 years,” said Bill Flores (R-Tex.). “For this administration to take credit for current activity is remarkable.”

Salazar responded that oil and gas industry response to previous OCS lease sales also should not be overlooked. “It’s a shared accomplishment. The oil and gas production we’re seeing in the gulf is largely dependent on the discoveries the industry has made,” he said. “We see robust production going on in the gulf today. Our expectation is with 12 additional lease sales there in the next 5 years, more production will come on line.”

Contact Nick Snow at nicks@pennwell.com.

Related Articles

Cooper to buy 50% of offshore Gippsland Sole gas field

12/17/2014 Cooper Energy Ltd., Adelaide, has bought a 50% interest in the offshore Gippsland Sole dry gas field in retention lease Vic/RL3 as well as 50% of t...

Repsol to acquire Talisman in $13 billion deal

12/16/2014 Spain’s Repsol SA has agreed to acquire all shares of Talisman Energy Inc. of Calgary for $8.3 billion along with assumed debt of $4.7 billion. The...

Eni reports flow test rates for well offshore Congo (Brazzaville)

12/15/2014 A production test conducted by Eni SPA on the Minsala Marine 1 NFW well offshore Congo (Brazzaville) flowed 5,000 b/d of 41° gravity oil and 14 MMs...

Cook to head DONG Energy E&P group

12/15/2014 David B. Cook has been named group executive vice-president and chief executive officer for exploration and production at DONG Energy, Fredericia, ...

Security takes center stage

12/15/2014

Thwarting terrorists, repelling pirates, and routing organized crime: sounds like themes of familiar, big-budget Hollywood movies.

Frac ban exemption made in Broomfield

12/12/2014 A Colorado District Court judge has ruled that a hydraulic fracturing ban in Broomfield, Colo., does not apply to an operator that entered into an ...

Uncertainty lingers about local content rules as Mexico prepares for competitive bid round

12/12/2014 The energy industry around the world has it eyes on Mexico as the country implements constitutional and legislative reforms that are set to open it...

COGA calls frac fluid study "sound science"

12/12/2014 Chemicals used in fracturing fluid appear to be no more toxic than chemicals commonly found in homes, said an analysis by University of Colorado Bo...

Study links methane contamination in water wells to poor well construction-not fracing-in Marcellus

12/12/2014 A new study found that fugitive gas contamination at eight clusters of water wells in the Marcellus and Barnett shale regions might be linked to we...

White Papers

AVEVA NET Accesses and Manages the Digital Asset

Global demand for new process plants, power plants and infrastructure is increasing steadily with the ...
Sponsored by

AVEVA’s Approach for the Digital Asset

To meet the requirements for leaner project execution and more efficient operations while transferring...
Sponsored by

Diversification - the technology aspects

In tough times, businesses seek to diversify into adjacent markets or to apply their skills and resour...
Sponsored by

Engineering & Design for Lean Construction

Modern marketing rhetoric claims that, in order to cut out expensive costs and reduce risks during the...
Sponsored by

Object Lessons - Why control of engineering design at the object level is essential for efficient project execution

Whatever the task, there is usually only one way to do it right and many more to do it wrong. In the c...
Sponsored by

Plant Design for Lean Construction - at your fingertips

One area which can provide improvements to the adoption of Lean principles is the application of mobil...
Sponsored by

How to Keep Your Mud System Vibrator Hose from Getting Hammered to Death

To prevent the vibrating hoses on your oilfield mud circulation systems from failing, you must examine...
Sponsored by

Duty of Care

Good corporate social responsibility means implementing effective workplace health and safety measures...
Sponsored by

Available Webcasts


On Demand

Optimizing your asset management practices to mitigate the effects of a down market

Thu, Dec 11, 2014

The oil and gas market is in constant flux, and as the price of BOE (Barrel of Oil Equivalent) goes down it is increasingly important to optimize your asset management strategy to stay afloat.  Attend this webinar to learn how developing a solid asset management plan can help your company mitigate costs in any market.

register:WEBCAST


Parylene Conformal Coatings for the Oil & Gas Industry

Thu, Nov 20, 2014

In this concise 30-minute webinar, participants have an opportunity to learn more about how Parylene coatings are applied, their features, and the value they add to devices and components.

register:WEBCAST


Utilizing Predictive Analytics to Optimize Productivity in Oil & Gas Operations

Tue, Nov 18, 2014

Join IBM on Tuesday, November 18 @ 1pm CST to explore how Predictive Analytics can help your organization maximize productivity, operational performance & associated processes to drive enterprise wide productivity and profitability.

register:WEBCAST


US HYDROCARBON EXPORTS Part 3 — LNG

Fri, Nov 14, 2014

US LNG Exports, the third in a trilogy of webcasts focusing on the broad topic of US Hydrocarbon Exports.

A discussion of the problems and potential for the export of US-produced liquefied natural gas.

These and other topics will be discussed, with the latest thoughts on U.S. LNG export policy.

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected