Chevron exec notes gulf permitting backlog

By OGJ editors
-- Despite new permitting by the US Bureau of Energy Management, Regulation, and Enforcement, the outlook for resumption of work in the Gulf of Mexico remains “challenging at best,” says an executive of one of the region’s most active deepwater operators.

Steve Thurston, vice-president of Chevron Corp.’s Deepwater & Projects Business Unit, reported his company’s permit status at the Decision Strategies Oilfield Breakfast Forum in Houston.

He said Chevron sanctioned $14 billion in new Gulf of Mexico projects last year, when the fatal Macondo blowout and spill on Apr. 20 halted activity and inaugurated a round of regulatory tightening and improvements by the industry to offshore well control and spill preparedness.

Chevron has 11 wells in the permitting process, Thurston said. It has two drillships back at work, one drillship waiting on a permit, and two drillships en route to the gulf.

A moratorium imposed after the blowout ended in October 2010 but has been followed by what Thurston called a “permitorium.” He pointed out that the BOEMRE issued its first new well permit on Feb. 28 and has issued only new nine new permits so far.

He said Chevron received its first drilling permit on Mar. 24.

The company has five revived exploration plans and one development plan in the permitting process now. Thurston said frequent requests for additional information keep plans from progressing to completion.

The BOEMRE issued its first exploration-plan approval last month.

Thurston said the outlook for further plan approvals remains uncertain because of new environmental assessment rules.

“There’s a huge backlog out there,” Thurston said.

“The industry can and will develop deep water safely,” he said, adding that it needs “a regulatory system that can up its game.”

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