DOI establishes Atlantic OCS seismic timetable with draft EIS

The US Department of the Interior set the stage for the first seismic evaluation of potential oil and gas resources off the South and Mid-Atlantic coasts in more than 30 years on Mar. 28 as it released a draft programmatic environmental impact statement for the program.

Plans call for approval of a final EIS by yearend so the US Bureau of Ocean Energy Management can begin to solicit bids from companies to conduct the research in 2013, officials said.

“There is significant interest in doing seismic exploration in the Atlantic,” US Interior Sec. Ken Salazar said during a Norfolk, Va., press conference. “The information we have is 30 years old. There will be 15 public hearings in the 8 states along the Mid- and South-Atlantic over the next 2 months.”

BOEM Director Tommy P. Beaudreau, who also participated, said the agency would work closely with the National Oceanic and Atmospheric Administration, which has extensive experience studying impacts of human activity on marine mammals, and consult with the US Fish and Wildlife Service about possible species effects, as it works on the final seismic EIS.

“We’ve received significant expressions of interest from companies in contracting for these seismic surveys,” he said. “We very much want to see them conducted. It’s important not only for the oil and gas side in developing new resource information, but also for renewable energy projects. These surveys will inform the potential for future lease sales as well as the sizing and configuration for renewable energy projects.”

Submitted applications

BOEM has received applications to conduct Atlantic seismic activities from CGG Veritas, Global Geo Services AS, GX Technology Corp., SeaBird Exploration Americas Inc., Spectrum Geo Inc., Spectrum GGS, TGS-NOPEC, and WesternGeco, according to the draft EIS. Comments on the document will be accepted until May 30, the agency said. It has scheduled public meetings in Jacksonville, Fla.; Savannah, Ga.; Charleston, SC; Wilmington, NC; Annapolis, Md.; Wilmington, Del.; Atlantic City, NJ; and in Norfolk.

“The first thing that needs to happen is for information to be developed about potential environmental impacts from doing seismic surveys,” Salazar said. “So much technology has changed to help us understand both the surface and ground of the ocean. We will have a decision on seismic this year. The next question is how to move forward. You won’t see rigs off Virginia until there’s a lease sale, however, and there isn’t one scheduled yet.”

Beaudreau said the seismic program—assuming BOEM decided to go forward with its permitting as early as next year—would allow both oil and gas producers and renewable energy developers to hire geophysical contractors to gather the information. No government funding would be involved, he emphasized.

Companies shooting seismic would retain data from areas they surveyed for sale to oil and gas producers, but BOEM would have information from all the surveys for use in planning for future oil and gas leases sales and offshore wind energy projects, he said. “We will be able to recreate the imagery created by all these surveys, where the companies will have information only about the areas they’ve contracted for,” he said.

The agency also will continue to work with states and other parts of the federal government to resolve potential conflicts between military and energy activities in the area, Beaudreau added. “As everyone in Norfolk knows, the military is very active off Virginia’s coast, and we want to work very closely with the Department of Defense to make sure oil and gas activity doesn’t conflict with its needs,” he said.

Support in Virginia

Virginia’s governor, US senators, and most of its US House members support federal leasing off its coast, and a recent survey found 80% of Virginians felt the same, according to Douglas W. Domenech, the state’s natural resources secretary. “The actions you announced today will help Virginians understand resources that are offshore and how to develop them in an environmentally responsible way,” he said, adding that Virginia’s government approved the first wind energy project in state waters a day earlier.

Virginia Gov. Robert C. McDonnell (R) said in a statement that he considered the announcement a small step forward after the Obama administration cancelled a federal OCS lease sale off the state’s coast which had been scheduled for 2011.

“Virginia was poised to become the first state on the East Coast to produce oil and gas offshore,” he said. “This breakthrough would have led to the creation of thousands of new jobs in our state, generated significant new revenues for state and local governments, and led to more domestic energy production…. Instead, the Obama Administration declared a 7-year timeout. That was the wrong decision.”

Salazar said DOI expects to finalize its 2012-17 OCS program, which does not include a lease sale off Virginia’s coast, by the end of June. The soonest one could be scheduled is 2017, he continued, although DOI could hold one sooner if information developed from the seismic surveys is sufficiently compelling. “But there are still two critical areas where information is needed: understanding the military needs in the area, and developing a better understanding of the area’s resource potential,” the secretary said.

“Seismic surveys are extremely important for all the reasons we described, but you need to be careful of possible environmental effects,” Beaudreau said. “We will work to develop mitigation measures by the end of this year and try to move forward with seismic surveys next year.”

Other responses

Officials from two oil and gas industry associations also noted in separate statements that the Obama administration could have done more.

“Since the areas have been largely unexplored for over two decades due to executive and congressional bans, the chance to conduct G&G activities there using modern-day technology is a welcome step,” said Randall B. Luthi, president of the National Ocean Industries Association.

“However, when it comes to oil and gas exploration, it appears that [DOI] has given the offshore industry a canoe with no oars, since there are no lease sales planned anywhere off the East Coast in the upcoming 2012-17 OCS leasing plan,” he maintained.

Meanwhile, Erik Milito, upstream director at the American Petroleum Institute, suggested, “This is a conversation starter that has been more than 3 years in the making, but the path forward remains unclear.”

He added, “Without an Atlantic coast lease sale in [its] 5-year plan, the administration’s wishful thinking on seismic research has no ultimate purpose. The White House has banned lease sales in the Atlantic for at least the next 5 years, discouraging the investment and job creation, and ultimately production, which would make seismic exploration valuable.”

Contact Nick Snow at nicks@pennwell.com.

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