P.2 ~ Western GoM lease sale high bids total more than $109 million

Western Gulf of Mexico Lease Sale 238 attracted $109,951,644 million in high bids for 81 tracts covering 433,823 acres on the US outer continental shelf.

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BOEM issues notice of proposed rule

The Bureau of Ocean Energy Management (BOEM) has issued an Advanced Notice of Proposed Rulemaking (ANPR) on Risk Management, Financial Assurance, and Loss Prevention to seek public input as it considers modernizing its risk management program and bonding regulations for offshore oil and gas operations on the outer continental shelf.

This first step initiates a dialogue about BOEM's existing regulations, which are 20 years old and have not kept pace with offshore infrastructure developments, including deepwater operations, current industry practices, and the growing costs of decommissioning.

"We would like to work with industry and others to determine how to improve our regulatory regime to better align with the realities of aging offshore infrastructure, hazard risks, and increasing costs of decommissioning," says BOEM Acting Director Walter D. Cruickshank. "Today's action is an important first step in initiating a dialogue on how to best enhance our risk management program to better match current practices, with the ultimate goal of ensuring that industry meets its decommissioning responsibilities and the burden of decommissioning a facility on the outer continental shelf does not fall to taxpayers."

BOEM is seeking stakeholder comments regarding various risk management and monitoring activities related to offshore energy development on the outer continental shelf. The advanced notice of proposed rulemaking seeks comment on the bonding and financial assurance program for BOEM's offshore oil and gas program. The bureau is also accepting comments on the analogous bonding and financial assurance program for BOEM's offshore renewable energy and hard minerals programs. The notice also solicits comments on best practices to mitigate risks, as well as whether, or to what extent, the current forms of financial assurance are adequate and appropriate.

The ANPR will be published in the Federal Register on Aug. 19. It includes a 60-day comment period which will close at midnight on Oct. 20. After the comment period closes, BOEM plans on continuing its outreach and hosting a workshop with stakeholders to have additional opportunities for discussion as it considers options for proposed regulations.

Chevron provides GoM operations update

Chevron Corp. has updated its offshore Gulf of Mexico operations. The company states that the production platform has been installed offshore at the non-operated Tubular Bells development in Mississippi Canyon block 725, and startup is expected in 3Q 2014.

Also in the deepwater Gulf, Chevron Corp. expects the startup of its Jack/St. Malo project later this year and from its Big Foot project in 2015. Offshore hookup and commissioning is under way at the Jack/St. Malo project, which remains on track for its expected startup in 4Q 2014. The Jack field is located in Walker Ridge blocks 758 and 759, while the St. Malo field is located in Walker Ridge blocks 633, 677, and 678.

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