Industry keeping tabs on funding request for US BOEMRE

President Barack Obama requested $358.4 million to fund the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE) in fiscal 2012. Oil companies operating in deepwater and offshore drilling contractors will be watching closely to see how Congress responds.

Following the April 2010 blowout of the Macondo well and the resulting oil spill in the Gulf of Mexico, government officials have acknowledged BOEMRE, formerly the Minerals Management Service, historically was underfunded. Lack of funding reportedly has hindered the agency's regulatory oversight of oil and gas activities.

Industry spokesmen have told OGJ that BOEMRE needs technically savvy inspectors and engineers who can keep up with deepwater drilling advances. BOEMRE also needs enough people to help streamline the approval process for deepwater drilling permits.

The requested BOEMRE budget marks a 50% increase above the 2010 funding level after adjusting for the reorganization of the MMS. Additional funding would be used to hire more inspectors, engineers, scientists, and others to oversee industry operations and to review offshore safety systems.

Industry agrees that BOEMRE needs more people. One issue that cannot be resolved by any budget request is the question of how to recruit and train additional BOEMRE inspectors so that they can be brought up to speed on the complex drilling equipment that they will be inspecting.

Crews cleaning oil residue from Louisiana wetlands

Crews using special vacuum devices are sucking pools of spilled Macondo crude oil residue out of Louisiana marshes, said US Coast Guard Rear Adm. Paul D. Zukunft, federal onscene coordinator for the Deepwater Horizon response.

“At some point, we will let Mother Nature do the work,” Zukunft said, adding the USCG and other federal officials are working with state officials to mutually determine when “there is no net environmental benefit” to continuing to clean marsh areas.

During a Sept. 29 teleconference, Zukunft said 588 miles of shoreline remained oiled and are being cleaned. This includes both marshes and beaches.

In Louisiana, one particular marsh cleanup crew involves 600 people, he said. Nine marsh areas continue to be cleaned, and they are all in Louisiana. Zukunft described a heavy, black “sticky residue in marsh grass.”

An Apr. 20 blowout of the deepwater Macondo well resulted in a fire and explosion on Transocean Ltd.’s Deepwater Horizon semisubmersible, killing 11 workers and resulting in a massive oil spill in the Gulf of Mexico. No oil has spilled since the installation of a capping stack on July 15. BP operated the well.

Baker Hughes opens drilling waste management R&D center

Baker Hughes Inc. opened its Eco-Centre waste management plant in Peterhead, Scotland, in June. In addition to treating and recycling drilling waste, the plant includes a research and development center.

Drilling waste contains oily residues classified as hazardous waste, and its disposal must follow strict federal and local regulations, Baker Hughes said in a recent company magazine, Connexus.

“Facilities that treat hazardous waste in the UK must adhere to Scottish Environmental Protection Agency guidelines and have an Integrated Pollution Prevention and Control Directive permit that outlines operational measures to control emissions to the environment,” Baker Hughes said.

Martin Gilbert, Baker Hughes global R&D manager, said he believes no other R&D center has direct access to drill cuttings and waste fluids like the one in the Peterhead Eco-Center.

Waste disposal from oil and gas drilling and production is an issue of growing important for operators worldwide. Baker Hughes said North Sea operators have the choice of hiring waste management companies to transport cuttings and fluids for disposal onshore or else operators reinject cuttings into dedicated disposal wells.

Florida lawmakers might reconsider offshore drilling

Oil & Gas Journal editors for decades have monitored discussions about possible drilling in the Gulf of Mexico off Florida. There is interest in a band of leases 7-10 miles off the coast south of Naples.

It’s believed the area has geology similar to the giant Jay oil field in the Florida Panhandle. Jay field, discovered in 1970, was the largest US discovery since the supergiant Prudhoe Bay oil field on Alaska’s North Slope (OGJ, Sept. 29, 1997, p. 101).

The Florida legislative session starts Mar. 2, and lawmakers again are expected to discuss whether the state should allow oil and gas exploration in state water off the Gulf Coast, where a ban has been effective since 1990. Tourism, especially visitors frequenting the beaches, is the often-cited reason for the ban.

Last year, the Florida House passed a bill that would have moved to allow drilling, but the idea stalled in the Senate. Senate President Jeff Atwater, R-North Palm Beach, ordered an analysis before the Senate can take any action.

Atwater is running for state chief financial officer. If lawmakers were to lift the ban, then a final decision on whether to offer drilling leases likely would fall to the state Cabinet, which involves the governor, attorney general, chief financial officer, and agriculture commissioner.

NOAA questions offshore drilling plan

The National Oceanic and Atmospheric Administration questions a plan to expand offshore oil and gas drilling, according to documents posted online by the Public Employees for Environmental Responsibility (PEER).

NOAA recommends safeguards for fisheries, marine mammals, and coastal populations that would significantly reduce the number and size of offshore tracts offered for exploration and development leasing.

NOAA filed its 26-page comment on Sept. 21, which was the US Minerals Management Service’s deadline for the Draft Proposed Outer Continental Shelf Oil and Gas Leasing Program for 2010-2015.

The 5-year leasing plan, issued in January, reflects the ideas of the former President George Bush administration. The plan would offer 12 lease areas (4 in Alaska, 3 in the Atlantic, 2 in the Pacific and 3 in the Gulf of Mexico) covering much of the OCS. Interior Secretary Ken Salazar is considering the plan.

In its comments, NOAA outlined its positions, including:
--Exclusionary zones that would block lease sales in the Northern Aleutians (including Bristol Bay), near shore in the Chukchi Sea, as well as all the proposed Atlantic and Eastern Gulf tracts.
--Buffer zones that would bar drilling “around national marine sanctuaries, habitat areas of particular concern, critical habitat for endangered and threatened species, major fishing grounds, and to provide visual buffers to coastal areas dependent upon tourism.”
--A moratorium on any Arctic Ocean drilling until better oil spill prevention and response capability is in place. NOAA also contends that MMS understates the expected frequency of and risk from spills, especially after Hurricanes Katrina and Rita.

PEER calls itself a service organization assisting federal and state public employees. “PEER allows public servants to work as ‘anonymous activists’ so that agencies must confront the message, rather than the messenger,” its website said.