East Coast: Oil Drilling

Will there be drilling on Georges Bank?
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	 		The Alaskan Star drilling rig  operates on Georges Bank in 1983. None of the test wells drilled in the  early 1980s found significant fossil-fuel deposits.File photo

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 		 	     	       	 		 			  By Patrick Cassidy


June 21, 2008

 	  	 	   	   	 	  	It has been nearly three decades since oil companies last dug into Georges Bank southeast of Nantucket.

The eight test wells drilled into the submerged glacial bump in 1981 and 1982 came up dry. At the time, environmentalists and fishermen vigorously opposed continued exploration, a fight that led to a ban on offshore drilling that spread down the East Coast and west to the Pacific.
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[li]Lawmakers vow to protect Georges Bank[/li][li]Georges Bank oil drilling banned in bill[/li][/ul]

		[IMG]http://static.djlmgdigital.com/cct/capecodonline/graphics/icons/icon_photo.gif[/IMG] Related Photo Galleries 			

[li]George Bank Drilling Rig Photos[/li][/ul]

   	Georges Bank 	

[li]Formed in the last ice age, 12,000 to 14,000 years ago[/li][LIST]
[li]16,000 square miles[/li][li]10 to 30 feet of water depth along “central crest,” sloping off to 600 feet deep on edges[/li][li]Located 40 to 200 miles off Cape Cod[/li][li]1 million tons of fish caught at height of foreign fishing operations in 1973, before U.S. marine territory was extended to 200 miles from shore[/li][/ul]
Source: NOAA scientist Michael Fogarty


 	 	 		But with President Bush's call this week to  lift the drilling moratorium on the Outer Continental Shelf and the  country facing high gas prices, future plans for Georges Bank may,  again, hang in the balance.

“We don’t even want to open that door, particularly in Georges Bank,” Peter Schelley, vice president at the Conservation Law Foundation, said yesterday.
The area is too valuable as a fishery and marine life habitat to risk, Schelley said.
Although Georges Bank may not be the first place companies would look for new offshore oil or natural gas deposits, they would come eventually if given the chance, said Michael Gravitz, oceans advocate for Environment America, a research and policy center associated with the U.S. Public Interest Research Groups.
“The seismic tools that they have today are just a world apart from what they had 25 years ago,” Gravitz said. “My guess is they’d be interested in going out there again.”
But any oil found in U.S. waters would not bring down the price of gas significantly or quickly, Gravitz said.
Oil companies expressed cautious optimism about the prospect of opening up more areas offshore for exploration and development leases.
“Obviously, we’re pleased at the first steps,” said Judy Penniman, a spokeswoman for the American Petroleum Institute, a trade association that represents oil companies.
It would likely be seven to 10 years before any production drilling took place if the moratorium is lifted, Penniman said. Individual states would have the power to veto drilling, she said.
Gov. Deval Patrick’s administration wants “no part” of drilling on Georges Bank, Robert Keough, spokesman for the state Office of Energy and Environmental Affairs, said in a telephone message left for the Times.

“Massachusetts fought the idea of offshore drilling 30 years ago,” Keough said. “It was a bad idea then and a bad idea now.”
“Then” was 1979, when a handful of oil interests bought more than $800 million in leases on Georges Bank through the U.S. Department of Interior’s Minerals Management Service.
A series of wells drilled about 125 miles off Nantucket to depths up to 20,000 feet found nothing, although a report from the MMS indicated natural gas may be found deeper.

Opportunity knocksSome companies that drilled in the area no longer exist, but the ones that do are actively seeking new opportunities.

“I think it’s safe to say that we’re always looking for new prospective areas that are opened up,” said Alan Jeffers, a spokesman for Exxon-Mobil.
Before the companies merged, Exxon and Mobil both drilled test wells on Georges Bank, along with Shell, Conoco and two other energy firms.
Those leases are no longer active, according to Caryl Fagot, an MMS spokeswoman.
Jeffers and other oil company representatives would not say whether Georges Bank was in their sights.
“We don’t know,” said Mickey Driver, a spokesman for Chevron. “We would have to look at the data.”
Chevron has drilling platforms off the eastern coast of Canada, but America’s northern neighbor also has a moratorium in place on its portion of Georges Bank.
“We need all the energy we can produce everywhere we can produce it in every form,” Driver said. “There’s no silver bullet.”
Companies such as Chevron have diversified and invested in wind, solar and geothermal projects, he said. But for now, with the United States consuming 20 million barrels of oil every day, drilling for crude remains definitely part of the mix, he said.

“It’s going to be oil today, tomorrow, 10 weeks and 10 years from now.”
Most of that oil comes from outside the United States, he said, adding that finding new deposits is the only way to meet future demand.

Fishermen tornThe reaction from local fishermen yesterday was mixed.
“The system that’s out there is unique in the world,” Jim Kendall, owner of New Bedford Seafood Consulting, said of Georges Bank. “We don’t really know what the outcomes of a disaster out there would be.”
Kendall fished Georges Bank when test wells were in place decades ago. He recalled boats catching nets on drilling equipment after they were supposedly removed.
The area poses challenges to fishermen even without man-made obstructions, he said.
Chatham fisherman John Our is more open to exploiting Georges Bank for energy.
“They could drill in Chatham harbor right now,” he said, adding that anything to bring down fuel prices that are hurting the fishing industry would be welcome.
Our, who used to fish on Georges Bank but now stays closer to shore, said he especially feels bad for boats out of New Bedford, which can spend $50,000 on fuel for a single trip.
But Our expressed skepticism that drilling at Georges Bank would put a dent in his diesel fuel costs.
“How many rigs can you put out there realistically?” he said.

Oil drilling moratorium on Georges Bank extended
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By Kevin Jess
May 18, 2010 in World
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Halifax - Canada’s federal and Nova Scotia governments have extended the moratorium on oil and gas exploration and drilling on Georges Bank to December 31, 2015. They say the massive oil spill in the Gulf of Mexico had little to do with their decision.
Nova Scotia Premier Darrell Dexter said in a press release, "We know that any decision on whether or not to lift the moratorium on Georges Bank could have significant economic and environmental impacts on the province, the country, and beyond. It is critical that government understands these impacts before such a decision is made."
In place since 1988, the ban was set to expire in 2012. This extension brings Canada’s position with respect to Georges Bank more in line with that of the United States which recently opted to extend its ban until 2017, reports the Globe and Mail.
Mr. Dexter assured, "We would want solid science and a full public review before making any decision to lift the moratorium. I have heard the public’s concerns and I am confident that extending the moratorium will put people’s minds at ease."
Georges Bank is well known for an abundance of haddock, halibut and scallops, but it is also home to endangered species of whales and turtles.
A major oil spill in the Georges Bank area would be “monstrous to think about,” said Wayne Petersen, director of the Important Bird Areas program for the Massachusetts Audubon Society, considering the abundance of sea birds off the coast of New England.
Some have questioned whether the oil spill in the Gulf of Mexico will affect Georges Bank.
Avijit Gangopadhyay, associate dean of UMass Dartmouth’s School for Marine Science and Technology and a professor in the department of estuarine and ocean science said to SouthCoast Today, while oil will dissipate as it travels, "water knows no boundaries. Wherever the current will go, it will take (the oil) with it."
Although Mr. Gangopadhyay admits it is “far-fetched” that the oil from the Gulf could reach Massachusetts, he said it could do so if the so-called Loop Current moves it around Key West, Florida.
If this were to happen the current would ferry the oil up the east coast.
On Monday, CNN reported tar balls being found on a Florida Keys beach.
Researchers reportedly are saying it is unlikely although not impossible that the tar balls have resulted from the oil spill south of Louisiana but they agree with federal officials that a plume of oil is in the process of being sucked into the Gulf of Mexico’s Loop Current.

Read more: http://digitaljournal.com/article/292182#ixzz2Jt63kSSF

Nova Scotia’s Georges Bank Offshore Oil Deposits
Georges Bank Offshore Oil Deposits

Georges Bank is a large, shallow, biologically diverse and productive bank on the outer shelf of eastern North America.

Canada and the United States share jurisdiction over Georges Bank; the Canadian side of the boundary includes the northeast portion known as the Northeast Peak.

Georges Bank is a relatively flat-topped bedrock feature exploited for a number of commercial species of fish.

It also contains the potential for large hydrocarbon reserves.

However, there is currently a moratorium in place on oil & gas exploration on Georges Bank. The federal and provincial governments have a joint agreement to extend the moratorium until 2015.

Oil & Gas - Offshore Oil Exploration and Development The petroleum resource potential is out there - right off the shores of Nova Scotia.
It’s already been tapped with the Sable Offshore Energy Project, the Deep Panuke natural gas project is coming soon.
Now, Nova Scotia is an even more attractive place for offshore investors.
Nova Scotia is a stable place to do your petroleum business. We’re close to the major North American energy markets.
We have brought fairness and speed to the regulatory process. And we are proud of the growing, worldwide reputation of our researchers, engineers, and fabrication and supply companies.
In 2012, Nova Scotia attracted two of the largest oil and gas companies in the world to explore the offshore - Shell Canada and BP Exploration Company Ltd. Shell Canada has been awarded the exploration rights for eight parcels, two in the Sable Island area and six in deep water. Shell has committed to spending more than $1 billion exploring these parcels over the next six years. For more information, please read the news release here.
BP Exploration has been awarded four deep-water parcels for a total exploration spending commitment of nearly $1.1 billion over six years. For more information, please read the news release here or visit the CNSOPB web site at www.cnsopb.ns.ca. Together, these two companies are investing more than $2 billion exploring Nova Scotia’s offshore over the next six years, demonstrating the confidence industry has in Nova Scotia’s potential.
Read on to learn more about the Nova Scotia energy advantage.

[li]Current Activity[/li][li]Economic Benefits[/li][li]Our History[/li][li]Regulations[/li][li]Companies Involved[/li][li]Georges Bank[/li][li]CNSOPB[/li][li]Maps[/li][li]Economic Scoping Tool[/li][/ul]

Offshore Oil Exploration Projects - Current Activity
Related Topics
2012 Offshore Profile
Nova Scotia offshore video
Offshore Renewal Plan
Public education (Oil & Gas)

Encana is progressing with development of Deep Panuke and first production is expected in 2012.

The Sable Project has added compression to its offshore platforms and is pumping more than 450 mmcf each day into the Maritimes and Northeast Pipeline, most of it heading to the northeastern United States.

In January 2012, the Canada-Nova Scotia Offshore Petroleum Board (CNSOPB) announced the awarding of exploration rights to Shell Canada Limited for four parcels of deep-water land off Nova Scotia’s south western shore. Shell has committed to spend a total of $970 million exploring those properties over the next six years. For more information, please read the press release.

The Deep Panuke offshore gas project, which includes a second pipeline to landfall, will be under development in the Sable Sub-basin area.

Nova Scotia has a plan to encourage more exploration, with new geoscience, policy, regulation and marketing. For more information please read the Nova Scotia Offshore Renewal Plan.
Offshore Oil Exploration Projects - Current Activity
Deep Panuke Project

The Deep Panuke Project is operated by Encana Corporation, and involves the installation of facilities required to produce and process natural gas from the Deep Panuke field, 250 kilometres southeast of Halifax, Nova Scotia on the Scotian Shelf. Natural gas from Deep Panuke will be processed offshore and transported, via subsea pipeline, to Goldboro, Nova Scotia for further transport to market via the Maritimes and Northeast Pipeline. The design capacity of the current project is 300 MMscfd of sales gas, with first gas expected in 2012.
Sable Offshore Energy Project

Based on July 2009 numbers, the Sable Offshore Energy Project (SOEP) production is averaging around 346 Mmcf/d production.

ExxonMobil installed a compression deck on the Thebaud platform which will push the gas to shore, lower the pressure at all platforms, and mean longer production from the fields. This unit is expected to boost output by 25% and significantly increase overall project deliverability until 2016.

Royalties Update

Royalty forecasts are sensitive to volatile and unpredictable gas prices and to estimates of recoverable hydrocarbons.

Royalty forecasts are updated quarterly as new information arises or as circumstances warrant.


I could not manage to copy and post this Nova Scotia block map, but perhaps someone else can?


I could not manage to copy and post this Nova Scotia block map, but perhaps someone else can?[/QUOTE]

An off-shore oil industry in my own backyard? I’m game.

So, to dig this up again, as I understand the ban on offshore drilling of the east coast is lifted in 2017. With the vast continental shelf off the coast of the Carolina’s and massive methane deposits in the deep water, does anyone see drilling coming soon that way? A local news article in South Carolina described some of the creators of Port Fourchon expressing interest in local ports to set up shop. Has anyone heard other info on this?

I see this as one of the many reasons that the boat companies are all in a building frenzy. The GoM is a large market, but not large enough IMO to justify 20-40 new-builds from every large player.

Perhaps this could justify the new X-bow designs being built as well.

The Atlantic is a whole other animal in respect to weather and sea conditions. So you could be correct. Also could be the reason for the new design we are seeing from most companies. Large, high bow, and a bit more freeboard.

Article from local newspaper in SC

Hopes for turning the port of Georgetown into a hub for the offshore oil and gas industry will come down to timing, according to industry experts. The South Carolina coast will have to be among the first tracts opened up for leases from the federal government.

If not, “you will probably miss that opportunity,” said Ted Falgout, a consultant to the oil and gas industry in Louisiana. He was the director of Port Fourchon during its 30-year rise from a fading commercial fishing port to the principal service center of the deepwater oil and gas industry in the Gulf of Mexico. He is now scouting locations for a similar facility on the East Coast.

The East Coast is off limits to the petroleum industry until 2017, but the federal government last month opened the door to offshore exploration. Conservation groups oppose the move saying the explosions of compressed air used in the test will harm marine mammals.

Deepwater drilling takes place in water deeper than 500 feet. When the Gulf was opened to the drilling in 1995, Port Fourchon took steps to accommodate larger vessels and infrastructure needed to get the oil to refineries. Falgout said the port issued bonds to pay for dredging and pledged the increased revenue from port fees toward repayment. Once traffic increased, the Army Corps of Engineers and industry contributed to maintenance dredging, he said.

The port of Georgetown stopped getting federal funds for channel dredging as its traffic volume fell. An effort to use state and local funds to trigger Corps of Engineers participation led to the creation of a local port task force. It is chaired by Tim Tilley, who also chairs the county Economic Development Alliance, which brought Falgout and a colleague, Lori LeBlanc, to speak with county leaders last week.

The oil and gas industry is only one potential user for the port, Tilley said.

The alliance believes there will be action on the port dredging this year, said Bill Crowther, its executive director. “We think we’re there,” he said.

He first met LeBlanc, who is also a consultant to the oil and gas industry, at a forum last year sponsored by the American Petroleum Institute. He invited her to speak to Georgetown County officials and business owners. “We’re trying to educate the public about the truth of what offshore exploration can mean to South Carolina,” he said.

In Louisiana, it means jobs and tax revenue, LeBlanc said. The offshore oil industry has a $44 billion economic benefit, with a $700 billion impact when related industries are factored in, she said.

“The boom of the offshore oil and gas industry results in the boom of many other industries,” she said.

She and Falgout came to the industry with environmental backgrounds. Falgout worked for the Sea Grant in Louisiana before he was offered the port job. He was named the state’s Conservationist of the Year in 2010.

LeBlanc, the granddaughter of a coal miner and the daughter of two Exxon employees, has a degree in environmental science and was the deputy secretary of the Louisiana Department of Natural Resources.

The idea that the petroleum industry degrades the coastal environment is out of date, LeBlanc said.

“We have the energy, we have the ports, we have the hunting and the fishing, and we balance it,” she said. “We can do it all.”

Falgout pointed out that Port Fourchon straddles two major estuaries. “It’s impossible to develop this area without impacting wetlands,” he said.

It also has to deal with the twin threats of subsiding delta land and rising sea levels. But he said the area around the port has been able to invest money from the petroleum industry in conservation projects.

There are 600 oil and gas platforms off Port Fourchon and each functions as an artificial reef for fish, Falgout said. There was opposition when they were built, but now there is concern about loss of habitat if they are removed, he said.

“I will probably go to my grave saying we made this a better place,” Falgout said. “With oil and gas off your coast, things like this can happen.”

Crowther said that is the message the alliance hopes to get out in Georgetown County. “You don’t have to choose between conservation and energy. You can have both and they’ve proven it in Louisiana,” he said.

But Falgout said for that to happen there has to be planning. “Who knows what can be done in this area,” he said. “Have a vision. Do it right.”

Crowther agrees that any future for Georgetown in the oil and gas industry rests in Washington. “We would love for Georgetown to be considered,” he said. “There’s a lot that would have to happen.”

He said U.S. 7th District Rep. Tom Rice and Sen. Lindsay Graham support the push for offshore drilling on the East Coast. U.S. 3rd District Rep. Jeff Duncan was among the co-sponsors of two bills last year to expand offshore drilling.

“It’s out of the hands of Georgetown, other than us putting pressure on our congressional delegation,” Crowther said. “Ted has told us it needs to be a daily conversation.”

All good points about the East Coast. My thought is along the lines of Gulf_engineer and justaboatdriver. The other thing I have been aiming to do is look up and see if these ports have been upgrading the old Navy Bases. Those would make get staging points. It will be interesting to see how many folks get in trouble with all the military exercises going on in the area.

[QUOTE=gulf_engineer;136437]The Atlantic is a whole other animal in respect to weather and sea conditions. So you could be correct. Also could be the reason for the new design we are seeing from most companies. Large, high bow, and a bit more freeboard.[/QUOTE]
We ran out of Davisville Depot to service rigs in the Baltimore Canyon and Georges Bank in the late '70s using the same AHTSs and mudboats used in the North Sea and the Gulf. The only difference nowadays would be to work in deeper water.

Y’all had bigger balls back in the day.

I work with some guys who got their start doing that, some badass boatmen came from that operation.

After going lobstering and scalloping on Georges in 45’-90’ wooden fishing boats, those 220’ steel AHTS mudboats seemed like going for a pleasure cruise on a battleship.

[QUOTE=AB Murph;136446]All good points about the East Coast. My thought is along the lines of Gulf_engineer and justaboatdriver. The other thing I have been aiming to do is look up and see if these ports have been upgrading the old Navy Bases. Those would make get staging points. It will be interesting to see how many folks get in trouble with all the military exercises going on in the area.[/QUOTE]

I’m not really sure what you mean by that. Hampton Roads (Norfolk) is a very busy port with lots of commercial traffic in and out daily. The only off-limits areas are in the immediate vicinity of the Naval station piers which are now cordoned off by a movable security barrier. And some of the beach area at the Joint Expeditionary Base Little Creek, where the SEALS train but I doubt Shell, etc would be interested in storming the beaches.

I would think the usual Notice to Mariners would warn of any particular security exercises in a given area.

So the real issue would be available land and pier space, not security issues.

Now, Charleston, that has more potential now that the former naval shipyard is largely turned over to private business. There is some unused or seldom used pier space in that area. Lots of offices for rent, lots for rent or sale, warehouse space, etc. Same with Philadelphia. In fact, there’s been a lot of redevelopment there at the old Navy yard.

I hope this happens. This is one of the reasons im trying to break in to the OSV industry. If it does happen I think it will be a good thing. It will make the local shipyards lots of money and the trickle down effects will also help lots of the small dieing east coast ports like Georgetown, Morehead City, and Cape Charles.

I think he is talking about the stuff the Navy does offshore like live fire and maneuvering exercises. And yes look at all of the stuff right here in town that is unused. Lamberts Pt docks, PMT, NNMT, the old railroad docks at Little Creek. And thats just here. Philly and Charleston have all of those old navy docks.