BOEM to Offer Over 21 Million Acres in Western Gulf Lease Sale

The Bureau of Ocean Energy Management (BOEM) will offer over 21 million acres offshore Texas for exploration and production in Lease Sale 233 in August.

The acreage, which includes 3,953 blocks located 9 to 250 miles offshore in water depths ranging from 16 to over 10,975 feet (5 to 3,346 meters), will include all available unleased areas in the western Gulf planning area.

The proposed sale is the third offshore auction under the current Outer Continental Shelf Oil and Gas Leasing Program for 2012 to 2017. The first sale under the plan, Western Gulf Lease Sale 229, was held in November 2012 and netted nearly $134 million in high bids. The second sale, Central Gulf Lease Sale 227, was held last month, and attracted over $1.2 billion in high bids.

BOEM estimates the sale could generate production of 116 to 200 million barrels of oil and 538 to 938 billion cubic feet of natural gas.

The proposed economic terms for the sale will not include the provision for deep gas royalty relief under the Energy Policy Act of 2005 (EPAct), which will end May 3. However, ultra-deep gas royalty relief required under the EPAct will still be available, BOEM said in a statement.

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BOEM to Offer Over 21 Million Acres in Western Gulf Lease Sale

The Bureau of Ocean Energy Management (BOEM) will offer over 21 million acres offshore Texas for exploration and production in Lease Sale 233 in August.

The acreage, which includes 3,953 blocks located 9 to 250 miles offshore in water depths ranging from 16 to over 10,975 feet (5 to 3,346 meters), will include all available unleased areas in the western Gulf planning area.

The proposed sale is the third offshore auction under the current Outer Continental Shelf Oil and Gas Leasing Program for 2012 to 2017. The first sale under the plan, Western Gulf Lease Sale 229, was held in November 2012 and netted nearly $134 million in high bids. The second sale, Central Gulf Lease Sale 227, was held last month, and attracted over $1.2 billion in high bids.

BOEM estimates the sale could generate production of 116 to 200 million barrels of oil and 538 to 938 billion cubic feet of natural gas.

The proposed economic terms for the sale will not include the provision for deep gas royalty relief under the Energy Policy Act of 2005 (EPAct), which will end May 3. However, ultra-deep gas royalty relief required under the EPAct will still be available, BOEM said in a statement.

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Western Energy Alliance brazenly flubs facts in new poll

Western Energy Alliance is hard at work spinning their new survey, which underscores the lengths to which they’ll go to increase the profit margins of the billion dollar oil and gas industry – even when that means putting water, public health, and local communities at risk.

WEA announced their new poll a month ago, but just released the results today. Was it because they needed all that time to figure out how to spin the poll?

Unfortunately for WEA, since they included so many factually incorrect statements in the poll, they won’t be able to use their results for much other than spin sessions. And, this isn’t the first time that WEA and their vice president for government affairs, Kathleen Sgamma, haven’t been able to keep their facts straight or master basic grade school multiplication skills.

While WEA’s poll also spins that the public supports hydraulic fracturing, there are already 351 towns and cities across the U.S. that have taken action to limit or ban fracking within their borders.

Here’s a look at some of the most glaring factual errors from the WEA poll materials:

WEA claim #1: “The government has prevented oil and natural gas development on federal lands, even though less than one-tenth of 1% of public lands is being used for oil and natural gas today.”

Facts: Both the federal government and industry has aggressively pushed to increase drilling activity on public lands. According to the U.S. Energy Information Administration, production of crude oil is at its highest level since 2002, and data from the Department of Interior show that oil production on federal lands was up 7 percent in 2012. This is despite the fact that nearly 21 million of the almost 39 million acres of public lands leased to the oil and gas industry sit idle.

WEA claim #2: The oil and gas industry do such a great job cleaning up lands where they’ve drilled that they’re considered wilderness, or pristine areas, post-clean up.

Drilling infrastructure in Wyoming. Source: EcoFlight

Facts: Reports on reclamation efforts in Utah, Wyoming and New York have shown that:

restoration attempts often fail and create long-lasting problems that threaten western wildlife;companies fail to provide adequately funded bonding, leaving behind billions in clean-up costs for states such as Wyoming; andthe oil and gas industry often fails to plug depleted wells – industry neglected to plug 89 percent of wells in New York.

In fact, a recent Government Accountability Office (GAO) analysis pointed to a highly inadequate system for funding clean-up of oil and gas wells on public lands.

WEA claim #3: “Increased energy production of American energy from public lands will lead to lower energy costs for consumers.”

Fact: Unfortunately for WEA’s spin team, experts agree – from BusinessWeek to the Energy Security Leadership Council – that the global market actually drives consumer oil prices, not U.S. production levels, so increased U.S. drilling doesn’t lead to lower energy prices.

Polls are only worth the paper they’re printed on if they fail to relay facts in a straightforward and honest way. Clearly, Western Energy Alliance and the companies they represent such as Anadarko and Noble care more about spin than they do about facts.

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Western Energy Alliance wants taxpayers to front $44 billion in handouts to most profitable companies in the U.S. – billion dollar oil and gas industry

The Western Energy Alliance has once again proved that they’ll go to any length to increase the profit margins of the billion-dollar oil & gas industry. Now they’re lobbying for $44 billion dollars in taxpayer-funded handouts over the next 10 years, despite the fact that the oil and gas companies are some of the most profitable in the U.S.

ExxonMobil and Chevron topped the Fortune’s rankings of the world’s most profitable companies in 2012. In fact, four of the top ten companies on the Fortune 500 list were oil and gas companies. And the big five oil companies, BP, Chevron, ConocoPhillips, ExxonMobil and Shell, made a combined profit of $118 billion dollars last year and $137 billion in 2011. 

The oil and gas industry has more than proven that they don’t need these excessive, wasteful subsidies – they’re making billion dollar profits while American taxpayers are paying more at the pump.  

Unfortunately, this is just the latest example of Western Energy Alliance putting profit margins of a billion dollar industry ahead of what’s best for Westerners.

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Chevron Evacuates Workers in Western Australia as Cyclone Nears

PERTH - Chevron Corp. has begun evacuating workers from some of its oil and natural gas operations in Western Australia state as Tropical Cyclone Rusty threatens to unleash high winds and flooding in the Pilbara region over coming days.

Chevron is moving non-essential workers on Barrow and Thevenard Islands as a precautionary measure, and tying down equipment ahead of the cyclone's arrival, the U.S. company said in a statement Tuesday.

Chevron operates oil facilities on the two islands, while Barrow Island is also the site of its 52 billion Australian dollar ($53.4 billion) Gorgon gas-export project, which is under construction and around 55% complete.

Workers have also been evacuated from the Atwood Osprey drilling rig, and Chevron said it is continuing to monitor the situation closely.

Woodside Petroleum Ltd., operator of the North West Shelf and Pluto gas-export facilities at Karratha, separately said it is taking precautions to "safeguard our people and assets" without being more specific.

Australia's three biggest iron ore ports are readying for the tidal surges, destructive winds and heavy rainfall predicted as Rusty heads towards land in the next day or so. Port Hedland, Cape Lambert and Dampier ports were closed Monday due to rough seas ahead of the storm.

Fortescue Metals Group Ltd. said its port and rail operations at Port Hedland have been locked down in accordance with cyclone readiness procedures.

"All work has been suspended on site," the Perth-based company said in an email.

Atlas Iron Ltd. said it has stopped work at its flagship Pardoo mining operations located about 75 kilometers east of Port Hedland.

"It is very much bearing down on us," managing director Ken Brinsden said of the cyclone on a conference call with investors. "It is looking almost like a direct hit on the Pardoo site."

He said Atlas didn't expect the temporary shutdown to affect the company's full-year guidance. Atlas Iron is targeting shipments of between 7.4-7.7 million metric tons of iron ore this fiscal year.

"There will be an impact, clearly, but we would expect to get back in pretty quickly," Mr. Brinsden said.

Rusty is expected to move close to the Pilbara coastline Wednesday and may intensify into a Category 4 system, Australia's second-most severe cyclone ranking that assumes very destructive winds and structural damage.

Australia's Bureau of Meteorology has also warned of flooding in some areas, along with a dangerous storm tide as the eye of the cyclone nears land.

Copyright (c) 2012 Dow Jones & Company, Inc.

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Shell to Drill in Western Black Sea

Royal Dutch Shell is to sign an agreement next week with Turkish state-owned energy company TPAO covering oil exploration in the western Black Sea region, according to a Reuters report Friday.

Sources told Reuters that the two companies envisage drilling at least one well within two years.

"Shell and TPAO's oil exploration work will be in the western Black Sea," said one source. "Depending on the results of this work, drilling will be carried out in at least one well within two years."

The deal will be signed Feb. 14, according to Reuters.

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ENI Makes Oil Discovery in Egypt's Western Desert

Italy's ENI announced Wednesday that it has made a new oil discovery at its Rosa North 1X well located in the Meleiha Concession in the Western Desert of Egypt.

Part of ENI's strategy to refocus exploration activities in the country by targeting deeper oil plays in the Western Desert, the well encountered a total oil pay of around 250 feet in multiple good-quality sandstones of the Bahariya, Alam El Bueib, Khatatba and Ras Qattara reservoirs. Oil flowed from these reservoirs at between 43 and 48 API at "very good rates", said the company.

ENI said it plans to develop the discovery by drilling at least two more wells in 2013. Production for each well is estimated at 2,000 barrels of oil per day.

Production at the Rosa North Field is expected to reach 5,000 bopd during the first 12 months, and will be delivered to the nearby processing facilities of the Meleiha field.

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