http://www.rawstory.com/rs/2010/11/professor-downplayed-oil-spill-federal-government-contracts/

NOAA funds a lot of research, but I didn’t know they used private funds. The disturbing part is BP’s role in defining the actual research and NOAA’s compliance with such influence. DV

RAW STORY – Blog
Investigation also finds BP telling university what to research

By Brad Jacobson
Thursday, November 18th, 2010 — 8:50 am

Quoted in scores of news outlets, appearing on dozens of network news programs and even landing a guest spot on The Late Show with David Letterman, oil spill expert Ed Overton has been a ubiquitous presence in the media throughout the Gulf oil spill disaster.

Professor Emeritus of Environmental Science at Louisiana State University, Overton, who has been criticized for downplaying the effects of the worst offshore oil spill in history, has also headed the National Oceanic and Atmospheric Administration’s chemical hazard assessment team for over 25 years.

Yet in nearly every media appearance, and even during congressional testimony, Overton, an environmental chemist, has omitted this long-term, high-level contracting position for the federal government through LSU, a Raw Story investigation has found.

Overton’s prominent NOAA role and questionable objectivity

Many marine scientists have received NOAA grants and funding off and on over the years and many have also omitted such ties during media appearances and congressional testimony.

Florida State University oceanography professor Ian MacDonald, for example, who has actually been a vocal critic of statements made by BP and NOAA — including their estimates of both the amount of oil flowing into the Gulf while the well was still gushing and how much remained once the well had been capped — confirmed to Raw Story via email that he and several other scientists testifying before Congress and speaking to the media haven’t necessarily divulged past or present funding from NOAA.

But Overton’s prominent position as the chief chemist and principal architect of NOAA’s Hazardous Materials Response Division dating back to the early eighties, along with his tendency to provide rosier-than-average assessments of the effects of the Gulf oil spill since the catastrophe began — opinions often in line with those of BP, NOAA and other federal officials — have raised questions about the omission of his contracting work and the scientific objectivity of his public statements.

Additionally, as professor emeritus, Overton confirmed to Raw Story that he officially retired from LSU and no longer receives a salary from the university; all his income tied to his university association since May 2009 has come through grants and contracts, and mostly through his work for NOAA. The latest NOAA funding for his work was a $1.3 million five-year grant.

Just days after the oil spill began in April, BP and the Coast Guard were telling Americans that no oil appeared to be leaking into the Gulf after the explosion of the Deepwater Horizon rig. In a Time magazine article at the time, Overton is the only scientist who jumped on this bandwagon, saying, “Right now it looks like we dodged a bullet.”

While Overton purports to only provide his personal science-based opinions, as he did in an interview last week with Raw Story, he praised BP back in May for “stepping up to the plate” to begin compensating “some of the locals.”

Though these types of public statements may be unrelated to subsequent grants by BP, they too raise questions.

In June, LSU was the first university to receive funding from BP’s $500 million Gulf of Mexico Research Initiative, which is supposed to support universities in the Gulf area in researching the effects of oil spills. LSU received $5 million from BP upfront as part of a $10 million grant over the next 10 years.

In speaking with LSU’s Office of Research and Economic Development, Raw Story also found that, while all studies performed by the university will be scientifically peer-reviewed, BP decides what areas LSU will research.

None of this funding, for instance, will go toward the study of the long-term health impacts on the “locals” — something that Overton has also tended to downplay, such as during his August testimony before a congressional body.

Speaking on the effects of polycyclic aromatic hydrocarbons (PAHs), highly toxic and carcinogenic chemicals found in crude oil, Overton, who is also an expert in environmental toxicology, merely echoed federal talking points, telling Congress that PAHs do not bioaccumulate, without disclosing other possible impacts.

Texas Tech University Professor Ronald Kendall, testifying on the same day, was then quick to point out that while the risk of bioaccumulation of PAHs appears low, chronic carcinogenic effects can still lethally damage the DNA of both marine and human life.

Overton: “You can Google and find out a lot about me”

At the beginning of an interview with Raw Story, Overton claimed that he “always” discloses his contracting work with NOAA. As the interview proceeded, though, he then said he tells “anybody and everybody that’s willing to listen,” before he finally admitted it was “perfectly legitimate” that he does not provide full disclosure.

“What gives me the credibility is that I’ve been doing this as part of the NOAA team for a long time,” Overton said.

“Now, you can infer some information from that,” he granted. “But I don’t have to run my opinions by NOAA, NOAA has not asked me to do that, and I wouldn’t do it if they did ask me. Because when the media asks me a question or anybody asks me a question, I’m giving my opinion as Ed Overton.”

But how can the public “infer some information” from Overton’s NOAA affiliation if this is almost never disclosed when he’s providing comments to the media?

“People can look me up,” he told Raw Story. “I’m part of the public record. You can Google and find out a lot about me.”

And what about omitting this disclosure while providing congressional testimony on the Gulf oil spill?

“They had some NOAA reps there,” said Overton. “And NOAA gave their talk and I gave my talk. But again, I was up there representing LSU, not necessarily other folks.”

Ironically, one of the rare instances when this disclosure has been made occurred during his visit to a late-night comedy talk show, The Late Show with David Letterman, during Letterman’s introduction of Overton.

Experts say disclosure critical, LSU professor calls Overton “industry shill”

In interviews with Raw Story, experts found Overton’s defense of non-disclosure wanting.

One of them, a fellow senior sciences professor at Overton’s own LSU, also noted that Overton “does not appear to be an unbiased source of information” and found it laughable that the head of NOAA’s chemical hazard assessment team is purporting to provide public comments as an “independent scientist.”

The LSU professor, who spoke with Raw Story on condition of anonymity for fear of retaliation by the university, explained, “The issue is that everybody who is involved in investigating this event and its effects needs to be upfront and honest about the sources of funding that they receive.”

“It doesn’t necessarily negate their credibility,” he said. “But they should at least be honest and open about it. If anything, that makes them more credible.”

The professor clarified, “I don’t think, per se, getting money from NOAA or EPA or FDA or any of the regulatory agencies necessarily means that the science is bad.”

But he went on to say that his impression of Overton’s consistently rosy scientific assessments, coupled with Overton’s routine omission of full disclosure, is what’s most troubling to him.

“I think that Dr. Overton comes across as being an industry shill,” the professor offered bluntly. “He has never said anything that was not in favor of what the industry was saying and continued to minimize the effects from day one about how bad this spill and its effects would be.”

In Overton’s interview with Raw Story, he went on to say that his main reason for not disclosing his high-level contracting position with NOAA is because it would appear that he’s boasting about his accomplishments.

“It’s just that I’m not going to stand in a short interview and introduce a title and sound like I’m trying to be bigger than I am,” he explained, adding that would seem “like I’m trying to beat my chestŠlike I’m the Price of Wales.”

Chris Pincetich, a toxicologist and marine biologist at the Sea Turtle Restoration Project, told Raw Story, “If Dr. Overton wants to continue to mask his true associations and roles in the spill and claim he’s doing so because he’s trying to sound humble, that’s his prerogative. But I don’t feel it really does justice to the public and our need for accurate information.”

Roy Peter Clark, vice president and a senior scholar at the Poynter Institute, a journalism think tank in St. Petersburg, Fla., agreed.

“As someone who’s got several titles, I can understand how someone might be a little reluctant on some occasions to stack them up as evidence of his or her expertise,” Clark said. “That said, I think that’s a very poor reason for not being as forthcoming as possible as to his professional connections.”

“Universities for many, many years have been up to their necks in federal grants, in research money from businesses of all kinds,” he explained. “The question is, is it possible to be unconflicted? And I would say the answer is no.”

“Therefore, if that poison is always floating around,” Clark continued, “it’s absolutely clear that the best antidote to even the appearance of conflict of interest is full disclosure.”

Pincetich and other experts interviewed for this article noted that many individuals have been serving dual roles during the oil spill response.

Yet it’s for this reason precisely that he believes full disclosure is necessary for people to be able to accurately assess the sources of information they’re receiving.

“The critical information that the public needed to make scientific and value-based judgments was often clouded by a lot of these folks which are serving dual roles either through their appointments to Unified Command or, like Ed Overton, their dual funding,” Pincetich said.
Overton consulted on and defended pilloried federal oil spill report

Pincetich pointed out that the Obama administration’s oil spill report that estimated 75% of the oil from the Gulf was effectively “gone,” a report on which Overton consulted for NOAA, was a prime example of how federal information “can sometimes be a little too rosy” and of why those with dual roles such as Overton should provide full disclosure.

Most outside scientists assailed the veracity of the August federal report, and a subsequent analysis by University of Georgia scientists soon arrived at quite opposite findings.

But Overton noted at the time that while “everybody seems skeptical” about NOAA’s report, he didn’t “think it’s too far off,” telling the AP that it was mostly good work and positing to the New York Times that it might have even overestimated the amount of oil left in the Gulf.

He also pointed out at the time that “[t]he Gulf is incredible in its resiliency and ability to clean itself up,” adding, “I think we are going to be flabbergasted by the little amount of damage that has been caused by this spill.”

Only days before that August federal report was released, CNN had aired a segment on AC 360 called “Was the oil disaster overblown?”

The sole expert interviewed during the segment? Ed Overton.

CNN’s Anderson Cooper began the interview, saying, “Ed Overton is professor emeritus in the Department of Environmental Sciences at LSU. He joins me now. Professor was this overblown?”

“Well, I don’t know, I certainly didn’t overblow it,” Overton responded. “People that have been around an oil spill for a long time I don’t think overblowed it.”

Pincetich concluded his interview with Raw Story by underscoring his belief in the public’s right to know “the true background, the true funding and the true motivations” of experts speaking on the Gulf oil disaster.

“I think this investigation that you’re doing now is a perfect case where we’re hearing a lot of stuff from an individual that we don’t know everything about their motivations,” he said.

Pincetich added, “It’s disturbing when scientists lose their objectivity because of funding sources,” which is why we need to “diligently understand the ‘position statements’ such as those being produced by folks with dual affiliations.”

As Raw Story was wrapping up its interview with Overton, he said, “You’re trying to come up with a controversy where there is none.”

When told that some people disagree with his view, he replied, “You know, that’s the way life is. If we all agreed with everybody, we’d be married to the same woman.”

Brad Jacobson is a contributing investigative reporter for Raw Story. You can follow his Twitter feed at twitter.com/bradpjacobson.
Raw Story Media, Inc., Washington, D.C.

Special thanks to Richard Charter

http://blogs.wsj.com/washwire/2010/11/19/landrieu-relents-on-lew-did-she-get-a-deal-on-drilling/

WSJ Blogs. Washington Wire–Political Insight and Analysis From The Wall Street Journal’s Capital Bureau
* November 19, 2010, 12:49 PM ET

Landrieu Relents on Lew. Did She Get A Deal on Drilling?
By Siobhan Hughes

How much did Sen. Mary Landrieu really get in return for dropping her opposition to Jacob Lew’s nomination to run the White House Office of Management and Budget? So far, it’s not clear.

Mr. Lew’s confirmation to the job late Thursday was made possible by Ms. Landrieu’s agreement to drop the hold she’d placed on his nomination as part of a battle with the Obama administration over offshore drilling. The Louisiana lawmaker blocked Mr. Lew’s bid to replace departed budget director Peter Orszag to protest the administration’s moratorium on new deepwater oil and gas drilling in the Gulf of Mexico.

The moratorium is officially ended, but oil and gas industry executives are still concerned that the Interior Department is enforcing what some lawmakers call a “permitorium” – acting so slowly on new drilling permit applications that it amounts to a ban.

Ms. Landrieu said she freed Mr. Lew’s nomination after getting commitments that Interior Secretary Ken Salazar “will outline the path forward so that permits will be issued and the people of Louisiana can get back to work in this vital industry.” A Landrieu spokesman declined to elaborate.

Jim Noe, the general counsel of Hercules Offshore Inc. (HERO) and the head of a coalition of shallow-water drillers, said he understood that the U.S. Interior Department had agreed to issue five shallow-water drilling permits this week and to approve a flurry of new permits next week.

But Kendra Barkoff, an Interior spokeswoman, said that Interior’s offshore drilling agency continues to review permits on a case-by-case basis, on their merits. The Bureau of Ocean Energy Management, Regulation and Enforcement has approved 15 permits to drill new shallow-water wells in the Gulf of Mexico and had six shallow-water permits pending as of Nov. 18. No permits to drill exploratory and development wells in the deep waters have yet received regulatory approval.

Mr. Noe also said that he expected the Interior Department to indicate its commitment to offering new leases in 2011 to drill in the Gulf of Mexico. The Interior Department has been expected by the industry to cancel a March 2011 lease sale because it only recently started to conduct an environmental review of the sale and this kind of review can take about six months to complete. The Interior Department has remained silent on its plans.

The conflicting versions of events suggest continued negotiations on drilling in the Gulf of Mexico, which currently accounts for 30% of domestic oil production. U.S. Interior Secretary Ken Salazar appears in Louisiana on Monday to address the industry.

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http://www.thestreet.com/story/10927553/1/obama-budges-on-offshore-drilling.html

The Street: Obama Budges on Offshore Drilling
By Eric Rosenbaum 11/19/10 – 09:05 AM EST

NEW YORK (TheStreet) — Oil drillers in the Gulf of Mexico received a positive signal on Friday with the confirmation of Jacob Lew as President Obama’s new budget chief.

Lew’s confirmation as White House budget chief had been held up by the Louisiana Senate power tandem of Sens. Mary Landrieu (D., La.) and David Vitter (R., La.), who wouldn’t budge on the budget chief unless the Interior Department relented on its slow road to new offshore drilling permits.

The drilling ban was implemented after the BP(BP) Macondo oil spill.

The White House has maintained all along that the drilling ban has not hurt the Gulf economy greatly, and the industry has overhyped the issue. The White House issued a report earlier in the fall with data it said backed the case that the drilling ban was more or less benign, though Obama did end up lifting the ban early.

Even though the White House had lifted the ban on new drilling in October, oil and gas companies have complained that the permitting process has become a bureaucratic nightmare.

Oil players including BP oil-spill partner company Anadarko Petroleum(APC) have said all along that they were ready to go the second the offshore drilling ban was lifted, but even with the ban eliminated, oil and gas companies are venting frustration over the long arm of the government.

It’s having an impact not just on administrators trying to get permit applications through the government, but leading to comments from oil and gas drilling company CEOs about a permitting process that could impact earnings for quarters to come.

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http://www.lakestevensjournal.com/county-state/article.exm/2010-11-19_call_for_study_of_gulf_fisheries_after_new_oil_spill_report_finds_risks_ignored

Lake Stevens Journal: Call For Study of Gulf Fisheries After New Oil Spill Report Finds Risks Ignored

Lake Stevens, Washington

Published on Fri, Nov 19, 2010 by Soundbite Services

The science is in, and it finds BP and its contractors failed to learn from “near misses,” and made risky decisions that contributed to the oil well blowout and spill in the Gulf of Mexico. Those findings are in an interim report out this week that was requested by Interior Secretary Ken Salazar.

Fisheries scientists, like Aaron Adams, director of operations with Florida’s Bonefish and Tarpon Trust, say the report is a good step as Salazar strengthens oversight of offshore drilling. He hopes the government’s next move is to conduct similar science-based studies of the Gulf’s fisheries to help safeguard them for the future.

“We know so little about the natural resources of the Gulf of Mexico, that if we put an oil rig, or do deep sea mining, or anything else, we don’t know if we put that in a particular location if it’s gonna severely impact part of that $140 billion fishery.”

Adams hopes the oil spill continues to motivate government agencies like the U.S. Department of Interior and the National Marine Fisheries Service to collaborate on a plan to assess and manage Gulf resources. He says as it stands right now there are big gaps in available data.

“There is no comprehensive map of habitat available in the Gulf of Mexico. In other words, we don’t even know what’s available for the fish to live and reproduce in the Gulf.”

He notes it is common for companies to roll as much as 20 percent of profits into research and development to stay viable, but nowhere near that kind of investment is being put in to Gulf research.

Adams is particularly interested in continuing impacts from the spill on the tarpon fishery and their migration range between Louisiana and Florida.

“A lot of the oil and the dispersant remains in the system, and since tarpon live up to eighty years, those effects may take a while to occur, but they’re also going to be long-term.”

He adds there’s little data available on tarpon, despite their cultural importance and estimated $6 billion value as a fishery.

Content provided on behalf of Bonefish & Tarpon Trust. Contact: Andrea Keller Helsel, 202-320-784, andrea@wcfnd.org

________________________________

http://online.wsj.com/article/SB10001424052748704312504575618852339002996.html

Wall Street Journal

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New York Times blogs: U.S. Oil Imports Shrink, Yet Worries Loom

November 19, 2010, 10:00 am
By CLIFFORD KRAUSS

Good news on the energy security front?

According to some October statistics released by the American Petroleum Institute, the United States imported 10.75 million barrels of oil a day last month, a decrease of 133,000 barrels a day from October 2009.

That decline may seem small, and indeed that is equivalent to only about one-eighth of what the country imports from Saudi Arabia every day. But from a security and economic point of view, some say that it’s a step in the right direction, particularly given that gasoline demand for the month was actually 0.6 percent higher than last October.

And it looks even better when you consider that imports from the Persian Gulf are declining by a faster rate than total imports. (Canada is the No. 1 source of imports, with Mexico coming in second.)

The reason the country can import less oil is that it is producing more domestically. The institute reported that crude oil production in the United States in October rose to 5.5 million barrels a day, the highest level since 2003. This reflects a continuation of another trend: domestic oil production has been increasing since 2009, the first year in nearly two decades that showed a rise.

Time to celebrate? Perhaps, but of course there is a cost. The increase in domestic production comes mostly from deepwater drilling in the Gulf of Mexico, a focus of attention since the BP disaster this spring and summer. Deepwater exploration has slowed since the accident and spill, and domestic production may level off over the next couple of years.

Unless, of course, production onshore increases — and that would depend on more hydraulic fracturing in new oil fields in North Dakota, Texas and Colorado that sit amid shale rock. Hydraulic fracturing, or fracking, involves injecting water and chemicals into the ground, and some environmentalists worry about the possibility of contaminating underground water supplies.

There is always Arctic drilling in Alaska to take up the slack, however, and Shell has plans to start drilling in the Beaufort Sea. Then again, the Obama administration doesn’t seem to be in a hurry to move forward with Arctic offshore drilling, given concerns over the recent gulf spill and polar bear habitat.

The United States can always import more from Canada, which is almost like not importing at all, some would argue. But then that means more refining of synthetic oil from oil sands, which have a larger carbon footprint than your average barrel from Saudi Arabia.

It gets complicated. Good news in the energy patch can mix with a downside, and bad news can still be really bad. Better walk to work tomorrow.

An earlier version of this post said the petroleum institute reported that crude oil production in the United States in October rose to 5.5 billion barrels a day; the correct number was 5.5 million.

Special thanks to Richard Charter

http://ecocentric.blogs.time.com/

Posted by Bryan Walsh
November 17, 2010 at 6:19 pm

It’s only been seven months since the Deepwater Horizon oil spill began, but doesn’t it feel so much longer? Maybe it’s the accelerated pace of modern media, which I attribute to Politico, Twitter or too easy access to Monster energy drinks. The offshore drilling industry is still complaining about government attempts at regulation-even though the White House lifted its moratorium on new deepwater drilling well before its six-month deadline was up-but little seems to have changed despite the biggest oil spill in U.S. history. (By the way, while the offshore drilling industry argues that renewed regulation is “starving” access to energy, the renewable energy industry has a much bigger problem-government grants that make solar installation economically viable are set to expire on Dec. 31, and there’s little hope Congress will act to rescue them. But considering the oil and gas industry spent $250 million in lobbying through the first six months of 2010, and the renewable industry spent $17 million, perhaps that’s not surprising.)

But before we return to normalcy, it might be nice to figure out why the Deepwater Horizon disaster happened. The National Academy of Engineering (NAE) released an interim report of its investigation into the spill this morning, and they found that the blame can be spread across the board. The report faulted BP and its chief subcontractors-Halliburton and Transocean-for inadequte training and supervision of personnel aboard the Deepwater Horizon, and a general lack of focus on safety.

Get the report http://www.nationalacademies.org

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http://www.washingtonpost.com/wp-dyn/content/article/2010/11/17/AR2010111705786.html

Washington Post

Experts: BP ignored warning signs on doomed well

By DINA CAPPIELLO
The Associated Press
Wednesday, November 17, 2010; 7:05 PM

WASHINGTON — A new report from an independent scientific panel says BP and its contractors missed and ignored key warning signs and failed to fully recognize important risks in the days and hours leading up to the massive Gulf of Mexico oil well blowout.

Some of the panel’s conclusions appear more critical of BP, the owner of the well, than preliminary findings issued last week by the presidential oil spill commission.

That commission said while BP made decisions that saved time it found no evidence that employees consciously chose saving money over safety. The National Academy of Engineering, which issued the latest report, said BP and others involved in the disaster failed to manage risks and didn’t even have a system in place to weigh safety against costs.

Several entities, including the Coast Guard, the Justice Department, Congress and BP itself, also are looking into the causes of the worst offshore oil spill in U.S. history.

The various inquiries have so far come up with similar core findings: That BP and its partners misread critical pressure tests, that the cement job meant to seal the well didn’t work, and that the blowout preventer failed to stop the gusher as designed.

Yet the investigations vary sharply in emphasis and tone. BP’s internal investigation spread the blame around, saying its partners on the doomed rig shared responsibility. The presidential panel said a cascade of failures, not any single decision, led to the disaster.

The engineering academy, which issued its report late Tuesday, focused on flawed and risky decision-making. It said that the companies involved downplayed the risks of deepwater drilling even as they insisted they never compromised safety.

“A great number of decisions, all of which appear to us to be questionable … also appeared to be justified by those individuals and those companies involved,” said Donald Winter, chairman of the 15-member panel.

The reasons behind the differences in the panels’ findings are unclear. But they may have something to do with who is doing the investigating and why. The presidential panel included academics and an environmentalist but is led by a former Democratic senator and a former EPA administrator who served during the George H.W. Bush administration. The academy panel is composed entirely of scientists and marine, petroleum, and chemical engineers. BP’s panel was made up of BP employees.

Some are tasked with looking at just the cause, and not the broader safety culture at the companies involved. Others are looking at offshore drilling broadly.

Winter, a professor of engineering practice at the University of Michigan, said in an interview Wednesday that the behavior leading up to the oil spill would be considered unacceptable in companies that work with nuclear power or aviation. The committee is considering whether an independent technical authority, similar to that used in the submarine and nuclear fields, would provide critical checks and balances that were lacking.

“In an operation like this you have to recognize the uncertainties of where you are going,” Winter said. Drilling an exploratory well more than three miles beneath the ocean’s surface involves significant unknowns, such as the underlying geology.

Among the hazards highlighted in the panel’s report were several tests that indicated the cement at the bottom of the hole would not be an effective barrier to an influx of oil and gas. More than a month before the disaster, BP also lost drilling materials deep in the hole – a situation that hinted at the challenges of the well, but was not used to address risks.

The report, while similar to previous investigations, does not weigh in on two central points – the path the oil and gas took to reach the rig and whether the type or mixture of cement was faulty. BP, and the presidential commission, both believe the flow of oil went up the inside of the pipe, not the sides – a conclusion that puts the blame more on Halliburton Co., the cement contractor, than on BP’s well design. They have also highlighted problems with Halliburton’s cement mixture and tests with similar blends that suggested it would fail.

The engineering panel said that those two points are still in dispute, and instead reiterated concerns highlighted elsewhere about BP’s decision to run a single piece of pipe from the ocean floor to the well’s bottom and to use fewer centralizers than recommended to center the pipe during cementing.

The report says it may not be possible to ever establish exactly what happened because much of the evidence was lost when 11 workers died and the rig sunk in April.

BP said some of the differences between the academy’s work and that of the commission are the result of new evidence that has yet to be considered by the academy.

“The National Academy of Engineering/National Research Council Committee’s interim report addresses similar issues as the Presidential Commission and BP’s own internal investigation but draws no final conclusions regarding the April 20th accident,” the company said in a news release.

Halliburton Co., in a statement issued Wednesday, said that it was still reviewing the 28-page document, but said “it notes that a variety of decisions made by BP may have contributed to the incident.”

Interior Secretary Ken Salazar asked in May for the investigation by the academy. In a statement issued Wednesday, Salazar and Bureau of Ocean Energy Management director Michael Bromwich said the committee’s work will help guide the department to strengthen standards and oversight of offshore oil and gas recommendations.

A final report is due June 2011.

—

Online:

Special thanks to Richard Charter

http://www.chron.com/disp/story.mpl/business/energy/7292617.html

By JENNIFER A. DLOUHY Copyright 2010 Houston Chronicle
Nov. 12, 2010, 10:25PM

WASHINGTON – The future of a planned March sale of offshore drilling leases in the Gulf of Mexico is in doubt because of the federal government’s plans to first conduct a lengthy environmental study of the region.

The environmental analysis – formally announced this week – is expected to take about six months, so it probably won’t be finished before March.

Although the Bureau of Ocean Energy Management, Regulation and Enforcement has not announced any delay in the lease sale covering offshore tracts in the central Gulf of Mexico, oil industry lobbyists and analysts said it is unlikely to go forward.

Analysts at the investment bank FBR Capital Markets said the March lease sale will probably be canceled because of the study and because of the bureau’s work vetting new drilling permits and drafting new safety rules.

“The agency faces significant workload on other offshore regulation, including permitting and public comment period requirements,” the analysts said.

Mike Olsen, a lawyer with the Houston-based Bracewell & Giuliani firm who previously spent five years working for the Interior Department, said such studies typically take several months, and it would be difficult to get one done by March.

The government’s environmental impact study is designed to assess the potential impact of drilling in the Gulf of Mexico in light of the Macondo deep-water well blowout and oil spill earlier this year. The last similar study was conducted long before the April 20 blowout that destroyed the Deepwater Horizon drilling rig and killed 11 workers.

“This is a vehicle for BOEMRE, other government scientists and the public to gather and consider new information obtained and analyzed as a result of the Deepwater Horizon blowout and spill,” said Michael Bromwich, the bureau director.
Helps decision-makers

He said the fresh assessment will allow his agency “to make objective, science-based decisions about the activities involved in offshore energy exploration, development and production.”

Under the government’s current five-year plan for drilling on the outer continental shelf – which runs through June 30, 2012 – the ocean energy bureau was slated to conduct three more sales in the Gulf of Mexico, beginning with the one in March and followed by sales in the Western Gulf of Mexico later in 2011 and in the Central Gulf in early 2012.

Bromwich said in an interview Tuesday that an upcoming “filing” would shed light on the future of the sales. It was unclear when – or what – that would be.

But the government may have tipped its hand with its formal announcement of the environmental impact study, which lays the groundwork for the upcoming sales.

The notice published in the government’s Federal Register on Wednesday specifically named two of the remaining three sales – and omitted the one planned for March. To analysts and industry advocates in Washington, that signaled the March sale is off
.
Notice revised

The government swiftly revised that notice, and the announcement published a day later did not specifically name any lease sales.

Olsen said the revision gives the government more flexibility and preserves the appearance, at least, that the March sale is still on track.

jennifer.dlouhy@chron.com

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http://www.dailycomet.com/article/20101113/ARTICLES/101119666/1212?Title=First-new-deepwater-permit-issued

Daily Comet

First new deepwater permit issued

By Kathrine Schmidt
Staff Writer

Published: Saturday, November 13, 2010 at 6:01 a.m.
Last Modified: Saturday, November 13, 2010 at 12:01 a.m.

HOUMA – Federal officials have issued the first deepwater permit since the Deepwater Horizon spill.

It’s not quite what the industry was hoping for – it’s not an entirely new well, but a water-injection well, which pumps substances into a reservoir that has already been drilled to extract additional oil and gas. But some are saying it’s a start.

The revamped Bureau of Ocean Energy Management issued the permit to BHP Billiton for a well in 4,583 feet of water on Nov. 5, according to spokeswoman Melissa Schwartz. The company will use Transocean’s Development Driller 1.

“It’s good news,” said Chett Chiasson, executive director at Port Fourchon, the Lafourche port that handles more than 90 percent of deepwater activity in the Gulf. “It’s not full-fledged new well drilling. It’s another positive step in the right direction. We’re hoping to see more of that in the coming weeks.”

That job will mean at least some additional business for Fourchon, since BHP Billiton uses a shorebase there, Chiasson said.

Still, the announcement was greeted without much enthusiasm from the industry and business advocates who have urged the federal government to speed up its issuance of permits in the aftermath of the April 20 Deepwater Horizon explosion, which killed 11 and caused the worst oil spill in the nation’s history.

Offshore oil-and-gas work has slowed substantially and drilling, an important economic driver in south Louisiana, has nearly stopped as officials implement new safety and environmental rules.

“Our initial concern is still valid. Up to 30,000 Louisiana jobs will be at risk if drilling activity does not reach a reasonable rate,” said Michael Hecht, President and CEO of GNO Inc, the New Orleans economic-development group.

Environmental groups have urged caution, and the administration has said the extra review time is necessary to make sure that emergency-response plans are in place and past safety problems are avoided.

Historically, the government has issued about four new deepwater permits per month, GNO said. In shallow water, the government historically has issued about seven new permits monthly, the group says. But in the seven months since the spill, the government has only issued 13 new well permits in shallow water.

Other permits have flowed more freely. The BOEMRE has approved more than 1,400 permits for shallow-water well construction or modification, known in the industry as workover, and 47 revised new wells.

In deepwater, there have been 24 deepwater workover permits and one sidetrack well, in which a new offshoot of a well is drilled from an existing one. Four new deepwater-well permits are awaiting approval.

While most of these permits provide oilfield-service work for area companies, new drilling provides the most.

Schwartz wouldn’t comment on when any of those new well plans would be approved.

“Hopefully we’ll see more permits coming in the coming weeks and get ourselves some sense of normalcy,” Chiasson said. “If that starts to happen, things are going to start looking up. We can begin to feel a little bit of relief and our businesses can continue what they were doing prior to the oil spill.”

Staff Writer Kathrine Schmidt can be reached at 857-2204 or Kathrine.schmidt@houmatoday.com.

Special thanks to Richard Charter

http://www.cubastandard.com/2010/11/16/petronas-expects-to-begin-offshore-drilling-in-2011/

The oil arm of Russian gas giant Gazprom bought a 30-percent stake in four offshore blocks contracted by Malaysian state company Petronas.

In making the announcement, JSC Gazprom Neft said in a press release that Petronas expects to begin exploratory drilling next year; 2D seismic surveys have been completed. A drilling platform is expected to arrive in Cuban waters early next year, where it will first be used by a consortium led by Spain’s Repsol S.A.

Last week, President Hugo Chávez announced that Venezuelan state company PdVSA will “soon” begin exploratory drilling. PdVSA’s four blocks are contiguous with Petronas’ blocks, off the western tip of Cuba. Chávez suggested to his oil minister to use a Brazilian platform.

Petronas signed a product sharing agreement for four blocks with the Cuban government in 2007, which allows for oil production through 2037 and gas production through 2042.

The additional agreement makes JSC Gazprom Neft a junior partner of Petronas in blocks 44, 45, 50 and 51. Exploration and production costs will be financed proportionally, subject to pro-rating of Petronas’ previous expenses.

“Gazprom Neft’s partnership with Petronas will enable the company to further extend its geographic reach and strengthen its position in the global market,” said Gazprom Neft Chairman Alexander Dyukov in a press release. “The offshore experience will promote the company’s growth.”

The four Petronas blocks are shown on the map online.

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Special thanks to Richard Charter