Offshore oil exploration stopped in Gulf of Mexico

Deep-water oil exploration on some drilling rigs in the Gulf of Mexico was stopped by U.S. regulators. According to Bloomberg, operations stretching as far as Brazil were discontinued after faulty bolts made by General Electric Co. were discovered on some rigs. The bolts are used to connect drilling tubes to safety equipment on the sea floor.

The article reported Chevron Corp., Royal Dutch Shell Plc and Transocean Ltd. are among the companies told to suspend work on rigs that use the faulty bolts after the U.S. Bureau of Safety and Environmental Enforcement issued an alert on January 29 about the equipment. Between 30 and 40 GE customers were reportedly at risk of being affected by the faulty bolts.

The bolts will be retrieved so they can be replaced, a process that may take up to three weeks for each rig, according to Bloomberg. The pause on exploration could be significantly delayed and cost companies hundreds of thousands of dollars.

Craig Pirrong, director of the University of Houston's Global Energy Management Institute, while discussing the enforcement by United States regulators, said the safety measure was a result of the government increasing scrutiny of deep-water drilling activities.

According to Reuters, offshore rig contractors in the Gulf of Mexico were told to inspect certain blowout preventers (BOPs) after a faulty bolt was to blame for a leak of drilling fluid in late January.

PennEnergy's research area provides more information on the top ten offshore drilling contractors.

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