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BOEM Document Seeks to Clarify Offshore Drilling Requirements

In an attempt to answer "recurring" questions from the oil and gas industry, the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM) Monday issued additional guidance "summarizing and clarifying" previously issued offshore deepwater drilling safety requirements.

The BOEM called the new five-page document a supplement to the guidance that was issued in mid-December (see Daily GPI, Dec. 15) to address questions posed by the new regulations that were imposed on producers following the Macondo well blowout and sinking of the Deepwater Horizon rig in the Gulf of Mexico (GOM) last year (see Daily GPI, April 22, 2010).

Specifically, the new document addresses:

This guidance highlights BOEM's process for reviewing subsea containment plans for deepwater operations. The guidance contains no additional regulatory requirements, but BOEM said it "instead provides clarifying information to assist the oil and gas industry in complying with existing regulations and guidance."

"Our goal remains the same as it has been from Day 1 -- to ensure that offshore operations are conducted as safely as possible," said Michael R. Bromwich, director of BOEM. "This guidance document gives deepwater drilling operators additional information to help address some of the recurring issues that have been raised in our ongoing discussions with industry."

After a long period of no activity, the BOEM's permit-issuing process appears to be gathering steam. Last week the Interior Department approved a fifth permit -- this time for Chevron USA Inc. -- to resume drilling in the deepwater GOM (see Daily GPI, March 25). This is the first permit issued for completely new exploration since the federal moratorium was lifted last October.

ExxonMobil Corp. was also issued a permit last week to resume deepwater drilling in Keathley Canyon Block 919, approximately 240 miles off the coastline south of Lafayette, LA (see Daily GPI, March 23). This was the first permit approved that designated the Marine Well Containment Corp.'s system as its containment solution, according to BOEM.

The BOEM also has approved permits for ATP Oil & Gas Corp., Noble Energy and BHP Billiton to resume drilling in the deepwater Gulf (see Daily GPI, March 1). The permits for these producers, as well as ExxonMobil, allow continuation of drilling that was interrupted by the moratorium. They do not permit new drilling.

Last week Bromwich said more deepwater permits "will be approved in the coming weeks and months." However, during the same speech he noted that the agency is taking steps to ensure a stronger firewall between the agency and those companies that it regulates, such as oil and natural gas producers.

Because of the sluggish pace of the permitting, Republican lawmakers, state regulators and producers contend that a de facto moratorium remains in place (see Daily GPI, March 17). Earlier this month oil and gas drilling services companies told attendees at CERAWeek in Houston that while the effects from the months-long de facto moratorium on GOM drilling are already being felt, the shockwaves from the U.S. government action are likely to reverberate for many years to come, even after the permitting flowrate gets back up to speed (see Daily GPI, March 10).

Bromwich said he and BOEM personnel have met regularly with multiple oil and gas operators and industry representatives to answer questions about new regulations, Notices to Lessees (NTL), and how the agency will apply National Environmental Policy Act requirements with respect to deepwater drilling operations. The issues addressed in the information document include compliance issues relating to: the Drilling Safety Rule (or Interim Final Rule) and NTL-10, as well as further information on BOEM's process for evaluating subsea containment information submitted by operators along with their permit applications.

The BOEM's new guidance document is available at: www.boemre.gov/ooc/pdfs/DeepwaterGuidanceSupplement.pdf.

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