Activity begins to pick up post-Macondo

Bruce Beaubouef • Houston

Drilling activity in the deepwater Gulf of Mexico has begun to show signs of life, as the Bureau of Ocean Energy Management, Regulation, and Enforcement has approved a handful of drilling permits over the past few weeks. These include work on projects being developed by ExxonMobil, BHP Billiton, Noble Energy, ATP Oil & Gas, and Statoil.

The first of these permits came in early March, when BOEMRE approved the first deepwater drilling permit since theDeepwater Horizon incident and the subsequent moratorium, which was lifted officially on Oct. 12.

This permit allows Noble Energy to finish drilling a well it began prior to the moratorium in Mississippi Canyon block 519, about 70 mi (~110 km) southeast of Venice, Louisiana, in 6,500 ft (~1,980 m) of water. This is a bypass well to drill around a block in the original bore. Noble has contracted the Helix Well Containment Group to use its capping stack should emergency well control be needed.

“This permit was issued for one simple reason,” said BOEMRE Director Michael R. Bromwich, when the permit was issued. “The operator successfully demonstrated that it can drill its deepwater well safely and that it is capable of containing a subsea blowout if it were to occur.” Bromwich also said that he expected further deepwater permits to be approved in the near future.

Then, in mid-March, BOEMRE issued the second deepwater drilling permit following the moratorium, this time for BHP Billiton’s Shenzi field. It is about 120 mi (193 km) south of Houma, Louisiana, and the permit allows the company to resume drilling that had originally begun in March 2009. As with the Noble permit, BHP will use a stacking cap designed by Helix Well Containment Group to contain oil in the case of a spill.

In the second half of March, BOEMRE then issued drilling permits to ATP Oil & Gas, ExxonMobil, and Statoil.

ATP’s permit allows it to resume drilling the Mississippi Canyon block 941 #4 well in the deepwater Gulf. The MC 941 #4 well at ATP’s Telemark hub in 4,000 ft (1,219 m) of water was drilled to approximately 12,000 ft (3,658 m) and cased during 2009. Operations to finalize drilling and completion were expected to resume in March.

At just about the same time, ExxonMobil received a permit to drill a new well in Keathley Canyon block 919. It is the first approved permit that names the Marine Well Containment Co. as the containment system supplier. The well is in 6,941 ft (2,116 m) of water about 240 mi (386 km) off the Louisiana coast. ExxonMobil had a permit to drill and a rig on site before the Macondo oil spill.

Then, in late March, Statoil received the go-ahead from BOEMRE to drill Well-1 in Alaminos Canyon block 810 in 7,134 ft (2,174 m) water depth 216 mi (348 km) offshore Texas. Statoil has contracted Helix Well Containment Group to supply containment services. Statoil had a rig under contract and an approved permit to drill when activity was halted in response to the Macondo well.

“We will continue to review and approve applications that demonstrate the ability to operate safely in deep water,” said Bromwich. “As we have seen, the rate of deepwater permit applications is increasing, which reflects growing confidence in the industry that it understands and can comply with the applicable requirements, including the containment requirement. We expect additional permit approvals in the near future.”

That could be seen in yet another post-Macondo permit issued by BOEMRE in March, allowing Petrobras to start production from its Cascade-Chinook project. Cascade-Chinook will have the first FPSO operation ever in the Gulf, and has the capacity to produce 80,000 b/d of oil and 500,000 cm/d (17.65 MMcf/d) of natural gas. The field is in 2,500 m (8,202 ft) of water. Petrobras did not release a production start-up target date.

These permits have been issued amidst increasing pressure from Republicans, oil-state Democrats, and industry groups to accelerate permitting in the Gulf to create jobs, boost domestic production, and potentially cushion the recent rise in gasoline prices.

Yet, there were also cautionary signals issued by the Interior Department. In early March, Interior Secretary Ken Salazar said that resuming a pre-Macondo pace of drilling while implementing new safety measures will depend on whether the agency receives a requested $133 million bump over current spending levels.

Foster Wheeler to design deepwater GoM pipelines

Foster Wheeler AG reports that its global engineering and construction group has been awarded a detail design contract by Enbridge Offshore Facilities LLC for the deepwater Walker Ridge Gathering System (WRGS) export gas pipelines and the deepwater Big Foot (BGF) export oil pipeline in the Walker Ridge (WR) area of the Gulf of Mexico. Foster Wheeler’s work on the design contract is expected to be completed during 2Q 2011.

Helix Well Containment Group grows to 22 companies

The Helix Well Containment Group (HWCG) has announced that W&T Offshore, Inc. and Stone Energy Corp. have joined the organization, increasing its membership to 22 deepwater oil and gas operators. HWCG is a consortium of deepwater operators in the Gulf of Mexico who have the common goal of quickly responding to a subsea spill to protect employees, communities, and the environment.

“The Helix Well Containment Group has invested in the best available technology, engineering and minds, and applied the most important lessons learned from the past to create a comprehensive well containment response system ready to be activated immediately in the event of a deepwater spill,” said John Weust, chairman of HWCG Steering Committee. “Representing two-thirds of the deepwater operators in the Gulf of Mexico and approximately half of all deepwater oil and gas production in the Gulf, we further expand our technical expertise and resources with the addition of W&T Offshore and Stone Energy.”

HWCG has signed an agreement with Helix Energy Solutions Group, which will provide the primary components of the well containment response system. Building upon Helix-owned equipment used in theDeepwater Horizon response, the system currently is capable of facilitating control and containment of spills in water depths down to 5,600 ft (1,707 m). In the coming weeks, the system will substantially increase its containment capacity, expanding its capabilities to water depths down to 8,000 ft (2,438 m) and capture and processing capabilities of 55,000 b/d of oil and 95 MMcf/d of gas.

Recently, the Department of the Interior approved three deepwater drilling permits in the Gulf of Mexico for HWCG members Noble Energy, BHP Billiton, and ATP Oil & Gas Corp. “We are encouraged by the Department of the Interior’s recent permit approvals, and we are eager to continue to work with the government to safely and responsibly develop our domestic deepwater energy resources,” said Roger Scheuermann, commercial director of HWCG.

The HWCG completed its first comprehensive, day-long tabletop exercise designed to increase members’ coordination and preparedness in the event of a subsea spill. The first of multiple exercises, it included 180 participants from HWCG member companies and service providers, and simulated the implementation of the group’s Well Containment Plan to assure rapid response and containment of a deepwater oil spill.

“Development of the HWCG Well Containment Plan has been a collaborative effort of our Deepwater Intervention Technical Committee (DITC), which is made up of some of the industry’s brightest and most experienced deepwater personnel,” said Tim Sargent, chair of the HWCG Technical Committee. A second tabletop exercise was planned for March 31, 2011.