OTC told MMS is likely to approve FPSOs for Gulf of Mexico

While the US Minerals Management Service still has not authorized the use of floating production, storage, and offloading systems in developing deepwater oil reserves in the Gulf of Mexico, industry and government officials at the Offshore Technology Conference seem to assume it's just a matter of time.


Sam Fletcher
OGJ Online

HOUSTON, May 2 -- While the US Minerals Management Service still has not authorized the use of floating production, storage, and offloading systems (FPSOs) in developing deepwater oil reserves in the Gulf of Mexico, industry and government officials at the Offshore Technology Conference seem to assume it's just a matter of time.

MMS officials are still studying the environmental impact study submitted in February that centers on a generic ship-shaped FPSO of a type that would most probably be used in the gulf.

But at a FPSO session Wednesday, J. Hammond Eve, part of the MMS staff who worked on that study, said, "We've plowed this ground as thoroughly as we can before getting an application for a FPSO. That's the next step."

No offshore operator has been willing to submit a development plan utilizing an FPSO "that would invite a lengthy EIS study," said Deborah Cranswick, senior environmental scientist with the MMS office in New Orleans. That, she said, would have "short-circuited" the whole purpose of using a FPSO to get a deepwater field into production more quickly.

Although an additional study still will be required for a specific proposal, Cranswick said, the preliminary study now under review would substantially shorten the process.

At a session on oil and gas development in water depths of 5,000-10,000 ft, Robert A. Solberg, president of commercial development for Texaco Inc.'s worldwide exploration and production operations, said the Gulf of Mexico surely will see use of FPSOs at some point.

David H. Welch, vice-president of Gulf Coast upstream operations for BP PLC, said, "If we thought we had a situation where a FPSO was the best solution, we wouldn't hesitate to go with that method for production."

OTC was told both FPSOs and conventional pipeline systems will be needed to develop deepwater reserves in the gulf within the next few years. Also possible is the use of a new "gas-carrier" design to transport compressed natural gas to shore. No vessels of that type have yet been built.

Contact Sam Fletcher at samf@ogjonline.com

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