IEA: Drilling requests picking up

The International Energy Agency (IEA) says that drilling requests for the Gulf of Mexico are picking up since the moratorium has been lifted, according to a Bloomberg report.

Offshore staff

PARIS -- The International Energy Agency (IEA) says that drilling requests for the Gulf of Mexico are picking up since the moratorium has been lifted, according to a Bloomberg report.

“Oil companies are queuing up to submit requests to recommence drilling, including many of those previously active in the area,” the IEA said in a report issued in mid-November. “Companies remain keen to work in the Gulf of Mexico, seeing it as one of the more profitable regions accessible to them.”

US President Barak Obama halted oil and natural gas drilling in waters deeper than 500 ft (152 m) after BP’s Macondo well blew out April 20, killing 11 workers and setting off the biggest oil spill in US history. The new rules will add $183 million a year to the cost of drilling on the outer csontinental shelf, the Interior Department said in an Oct. 14 notice in the Federal Register.

The rules will add $1.42 million in costs for each new deepwater well that uses a floating rig, the department predicts. Shallow-water wells could cost an extra $90,000. Oil production in the Gulf for 2010 will be 60,000 boe/d and 100,000 boe/d in 2011, lower than earlier forecasts, the IEA said.

The rules are aimed at tightening workplace safety on offshore rigs and beefing up standards for equipment. Chief executive officers will have to certify that their companies comply with the regulations. Drillers will have to provide third-party verification that blowout preventers are properly designed and can stand up to pressure under all conditions.

Offshore operators remain optimistic about the Gulf. On Oct. 21, Chevron approved a $7.5-billion plan to develop oil and gas fields in the GoM. And Royal Dutch Shell says it expects to produce 220,000 b/d of next year in the Gulf.

11/17/2010

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