MMS still wary of FPSOs in Gulf of Mexico

Operators still have not received assurances from the U.S. Minerals Management Service on whether floating, production, storage, and offloading (FPSO) vessels will be allowed to serve as production facilities in the Gulf of Mexico OCS. Chris C. Oynes, MMS Regional Director, Gulf of Mexico Region, discussed remaining unresolved environmental, conservation, and technical issues concerning FPSOs in a presentation, co-authored with Don Howard, MMS Regional Supervisor for field operations, at the

May 18, 1998

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Chris C. Oynes, MMS Regional Director, Gulf of Mexico Region, discussed remaining unresolved environmental, conservation, and technical issues concerning FPSOs in a presentation, co-authored with Don Howard, MMS Regional Supervisor for field operations, at the Offshore Technology Conference in Houston early this month.

Burden of proof

MMS places on the operators the burden of proof for demonstrating that FPSO operations can be performed in a safe and pollution-free manner. The authors said MMS has to be assured that FPSOs will not increase environmental risk vs. other options.

The authors said that environmental issues related to an FPSO installation would trigger the need for an environmental impact statement (EIS), which would be a 2-year process.

But the authors added that a third-party contractor could reduce this time to about 14-18 months if the industry submits either a formal site-specific FPSO-based development operations coordination document or a generic environmental document.

Another concern of MMS is resource conservation related to gas disposition and early abandonment of producing zones.

The authors said MMS might allow limited gas flaring of up to 1 year with an approved plan for later eliminating flaring by either installing a gas pipeline or reinjecting gas into a formation. Oynes stressed that the reinjection option would have to spell out the manner for eventually recovering this gas.

FPSO installations also still have unresolved technical and operational problems. The authors said the U.S. Coast Guard would likely require double hulls on Gulf of Mexico FPSOs, and MMS still has questions about shuttle tanker interface with production equipment.

According to a recently published U.K. Health and Safety Executive on FPSO operations, the greatest single marine risk is a collision between an FPSO and its offtake tanker.

The authors cautioned operators that environmental and regulatory requirements cannot be compromised as part of a fast-track project, even though this is a common theme for many deepwater development projects.

Because Oynes expects one operator to submit, before long, a development plan for installing a tanker-based production facility without storage, he declined to comment on whether MMS would treat such a facility option as an FPSO or as the floating semisubmersible, tension-leg, or spar facilities already active in the Gulf of Mexico.