Your Voice Matters: Tell Federal Regulators You Support Safe Energy Exploration in the Gulf of Mexico

Shell Announces Large Deep-Water Discovery In Gulf of Mexico

via Shell

Shell Offshore Inc. (“Shell”) recently announced one of its largest U.S. Gulf of Mexico exploration finds in the past decade from the Whale deep-water well. The well encountered more than 1,400 net feet (427 meters) of oil bearing pay. Evaluation of the discovery is ongoing, and appraisal drilling is underway to further delineate the discovery and define development options.

“Deep water is an important growth priority as we reshape Shell into a world-class investment case,” said Andy Brown, Upstream Director for Royal Dutch Shell. “Today’s announcement shows how, through exploration, we are sustaining a strong pipeline of discoveries and future projects to sustain this deep-water growth.”

Whale is operated by Shell (60%) and co-owned by Chevron U.S.A. Inc. (40%). It was discovered in the Alaminos Canyon Block 772, adjacent to the Shell-operated Silvertip field and approximately 10-miles from the Shell-operated Perdido platform.

“Whale builds on Shell’s successful, nearly 40-year history in the deep waters of the Gulf of Mexico and is particularly special in that it offers a combination of materiality, scope and proximity to existing infrastructure,” said Marc Gerrits, Executive Vice-President Exploration for Royal Dutch Shell. “The result is another opportunity to think differently about ways we can competitively develop deep-water resources.”

This major discovery in a Shell heartland adds to the company’s Paleogene exploration success in the Perdido area. Through exploration, Royal Dutch Shell has added more than one billion barrels of oil equivalent resources in the last decade in the Gulf of Mexico.

Shell currently has three Gulf of Mexico deep-water projects under construction – Appomattox, Kaikias, and Coulomb Phase 2 – as well as investment options for additional subsea tiebacks and Vito, a potential new hub in the region. The Shell group expects its global deep-water production to exceed 900,000 boe per day by 2020, from already discovered, established areas.

Chevron Announces Major Oil Discovery in Deepwater Gulf of Mexico

Via Chevron

Chevron Corporation (NYSE:CVX) recently announced a significant oil discovery at the Ballymore prospect in the deepwater U.S. Gulf of Mexico.

Ballymore is located in the Mississippi Canyon area of the U.S. Gulf of Mexico, approximately three miles from Chevron’s Blind Faith platform, in water depth of 6,536 feet. The initial Ballymore well reached total measured depth of 29,194 feet and encountered more than 670 feet net oil pay with excellent reservoir and fluid characteristics. A sidetrack well is currently being drilled to further assess the discovery and begin to define development options.

“The Gulf of Mexico deepwater is an integral part of our company’s long-term strategy,” said Jeff Shellebarger, president of Chevron North America Exploration and Production. “This discovery is an important addition to our portfolio, especially with its combination of size, quality and proximity to existing infrastructure.”

Chevron subsidiary Chevron U.S.A. Inc. is the operator with a 60 percent working interest in the Ballymore prospect. The co-owner is TOTAL E&P USA Inc. (40 percent).

Chevron Corporation is one of the world’s leading integrated energy companies. Through its subsidiaries that conduct business worldwide, the company is involved in virtually every facet of the energy industry. Chevron explores for, produces and transports crude oil and natural gas; refines, markets and distributes transportation fuels and lubricants; manufactures and sells petrochemicals and additives; generates power; and develops and deploys technologies that enhance business value in every aspect of the company’s operations. Chevron is based in San Ramon, Calif. More information about Chevron is available at www.chevron.com.

APPEL: A Legal Case You’ve Likely Never Heard Of Signifies More Damage To Louisiana’s Oil And Gas Industry

via The Hayride

A recent conversation with a very successful oil and gas exploration operator gave me a sense of foreboding about something few of us have paid much attention to regarding the decline of Louisiana’s energy industry discussed yesterday in these pages.
Our readers likely have not heard of the case of Vintage Assets, Inc. v. Tennessee Gas Pipeline Company, LLC et al, but it’s a significant ruling handed down by Jane Margaret Triche Milazzo, a federal judge in New Orleans appointed to the bench by Barack Obama in 2011. A decision in that case last August went entirely the wrong way for the future of our energy economy…

Natural gas pipeline companies must repair some of the erosion that has occurred since 1953 along their pipeline canals on 20,000 acres of wetlands owned by New Orleans-based Vintage Assets Inc. in the Breton Sound basin in Plaquemines Parish, or compensate the landowner for the damages, a federal judge in New Orleans ruled Tuesday (Aug. 22).
If upheld on appeal, the ruling could set a precedent for how erosion attributed to other pipeline canals will be handled by both federal and state courts in other lawsuits, observers say.
The decision paves the way for a trial to begin on Sept. 11 before U.S. District Judge Jane Triche Milazzo to determine how much damage was caused by the canals built by Tennessee Gas Pipeline Co. LLC and Southern Natural Gas. Co. LLC, both subsidiaries of Kinder Morgan, and by the privately owned High Point Gas Transmission LLC and High Point Gas Gathering LLC, and how the losses will be compensated. Milazzo was appointed to her seat in 2011 by President Barack Obama.
Milazzo’s ruling did not indicate whether any money awarded to Vintage Assets would have to be used to restore wetland damage on the property. However, the trust that controls Vintage Assets has indicated it plans to use money it receives for that purpose.

The lawyer representing Vintage Assets? One Gladstone Jones, the lead plaintiff attorney in the Southeast Louisiana Flood Protection Authority coastal lawsuit case thrown out in a different federal court – and appealed all the way to the Supreme Court, to no avail of the plaintiffs. The chances are reasonably decent that this case will meet a similar fate.

But even if overturned, per my conversation with the oil and gas operator referenced above, this case has sent a message that judges, even Federal judges, will accept this newly crafted argument.
Vintage Assets is a company owned by the Perez family of Plaquemines Parish. Louisianans know well of their exploits.
I am not sure that this litigation has been given much attention but the result, if allowed to stand, is an overwhelmingly devastating blow to our oil and gas industry.
The ruling could set a precedent under which pipeline operators, whether the original pipeline owner or not, could be held responsible for massive sums to landowners that ironically were paid by the very same pipeline companies for years. And to make it worse the money may or may not (I suspect may not) ever be used to rehabilitate land that was claimed to be degraded. Jones claimed his clients the Perezes will remediate the land – do you want to give odds on how much of the award, if it stands, would go to that purpose?
The big winner will be the governor’s trial lawyer pals who will have a profitable new precedent under which they can sue pipeline companies all over Louisiana and from which they will make millions at the expense of Louisiana.
So why do we care? Well, when pipeline companies are subject to massive lawsuits resulting from decades old installations, they will simply quit building pipelines in Louisiana.
No pipelines, no oil and gas exploration.
No oil and gas exploration, no jobs and no state tax revenue.
No tax revenue and our governor will insist that we raise taxes on other businesses and our people to feed his spending addiction.
The result is a classic anti-economic growth death spiral brought on by the greed of the few who are supported by our own governor.
I once made a mistake on a similar issue and now I am sincerely sorry to have caved in to a glossed-over argument. It won’t happen again.
Business reads newspapers and makes plans based on their expectations of a business climate in which they will be subject to lawsuits such as this. The loser is always our people.

ExxonMobil Brings STEM Education To Louisiana

On Monday, Jan. 22, ExxonMobil, the Louisiana Department of Education and National Math and Science Initiative (NMSI) celebrated student success in advanced placement courses across Louisiana. The groups held a press conference at Woodlawn High School in Baton Rouge where First Lady Donna Edwards, Superintendent John White, NMSI Representative Matthew Randazzo and ExxonMobil Manager Angela Zeringue spoke in honor of student accomplishments.

In 2016, a $13 million ExxonMobil grant dramatically increased the number of high school students in the state who take and pass college-level courses in math, science and English by funding the NMSI’s College Readiness Program. The program offers a variety of help for participating schools: a summer training institute, mentors for teachers new to AP, several Saturday help sessions for students at participating schools and extra money for schools to buy additional AP instructional materials.

Since the launch of the program, NMSI found that “underrepresented groups” at those 13 schools enjoyed particularly strong growth with 51 percent growth among females, 65 percent among African-American students and 83 percent among Latino students.

Thank you to ExxonMobil for your commitment to Louisiana’s future! To learn more, check out this article from The Advocate: http://bit.ly/2nnGnV5.

LA Tech Eco-Car Team Competes at 2018 Shell Eco-Marathon

via LA Tech

Each New Year offers the opportunity to start fresh and make changes in small or large ways.

A group of Louisiana Tech students have set the goal of placing first in the 2018 Shell Eco-marathon Americas (SEM), an international competition hosted in three locations around the world by Shell Global. This year’s competition will be held in April in Sonoma, California. There, 150 teams from North and South America gather to compete for the title of most energy efficient vehicle in their category.

“Our team designs and builds a vehicle that averages about 400 miles per gallon,” said Dr. Heath Tims, advisor for the Louisiana Tech University Eco-car Team. “The car must meet street-legal qualifications and must include the same features as cars we use on the roads today.”

The team uses carbon fiber bodies and professional-quality paint jobs to draw the eyes of spectators as well as fellow participants. Members come from different backgrounds and majors to form a fully functioning team that runs much like a business.

“Engineers are not solely responsible for developing solutions to the world’s energy crisis, and engineers are not solely responsible for making this team,” team member Madison Wooley said. “We all play a part in working for a better world.”

The competition offers off-track awards in communication, technical innovation, safety, and vehicle design. The team’s new partnership with Louisiana Tech’s School of Design (SOD) stands to boost the program into a new era, improving branding and promotion for the team.

“Ultimately, we’re binding two colleges at Louisiana Tech to excel in the competition, earn our way back to the podium and make our university proud,” Wooley said.

Follow the team’s journey online @LATechEcoCar.

Supporting the Working Coast

via The Water Institute of the Gulf 

Land loss, sea level rise, subsidence, and storms increasingly threaten the economic sustainability of Gulf coastal areas at a time when populations and infrastructure investments are rising.

More than two million people live in Louisiana’s coastal zone, many in communities that face increasing risk of flood from storms or severe rain events. The industries many residents depend on for their livelihood are no different. It has been estimated that a three-month closure of Port Fourchon in south Louisiana – a major hub supplying the offshore oil and gas industry – would cost a national reduction in the gross domestic product to the tune of $7.8 billion.

At the same time, Louisiana is facing a coastal land loss crisis. Between 1932 and 2010, Louisiana lost more than 1,800 square miles of coastal land and is expected to lose an additional 2,250 square miles in the next 50 years if no action is taken. The state has aggressively worked to address this issue through the formation of the Coastal Protection and Restoration Authority, which continues to build and improve coastal projects for better long-term stability. However, even the state recognizes the amount of work needed far outstrips the funding that has been identified so far meaning Louisiana’s vast coastal infrastructure faces immediate threats.

For this vital “Working Coast” to continue to flourish, the changing coastal context must be understood in a way that enables coastal businesses to manage risk, sustain the environment, and leverage opportunities to enhance resilience for the economy, the environment, and local communities.

APPROACH

Partnering with industry, The Water Institute of the Gulf is working across the coastal zone with ports and industry to help address some of the challenges faced by infrastructure in these changing landscapes. The following are two examples of how the Institute is implementing its “Working Coast” strategies.

Port Fourchon

South Louisiana’s Port Fourchon plays a critical national economic security role by providing the U.S. with approximately 18% of its total oil supply and servicing over 90% of the Gulf of Mexico’s deepwater oil production.

As Port Fourchon continues to grow, there are plans to potentially deepen the port’s access channel which could yield more than 20 million cubic yards of sediment. This situation presents a unique opportunity as the port will need to dispose of the material while also desiring additional storm protection.

The Institute has proudly worked to create a Public-Private Partnership with the Port, Shell, Chevron, and Danos to determine the best, nature-based way to use the dredged material to protect the port’s critical infrastructure, improve the environment; make communities from Fourchon to Larose more resilient; and yield carbon-capture sequestration benefits.

Lake Charles

The Port of Lake Charles faces challenges due to the large amounts of sediment flowing into the Calcasieu Ship Channel, forcing ongoing dredging. While the port has been proactive in finding ways to beneficially use the dredged sediment, the port seeks a sustainable way to better manage sediment through the system.

Currently, the Calcasieu Ship Channel must be dredged yearly to make sure it meets the 400-by 40-foot-deep federally mandated requirements. It’s estimated that the Port of Lake Charles will need to have 97 million cubic yards of disposal capacity for dredged material within the next 20 years.

In August 2017, the port tasked the Institute with providing a better understanding of how sediment moves through the ship channel as part of a strategy to reduce dredging needs and to evaluate alternative locations to find long-term and realistic dredge disposal sites.

Louisiana’s New Trial Lawyer Shakedown

Via Washington Examiner

Liberal New York City Mayor Bill De Blasio made headlines recently when he announced that the city would be suing five major oil companies for damages sustained during Hurricane Sandy, on the theory that the storms were worse because of those companies’ contribution to climate change.

In Louisiana, Gov. John Bel Edwards and his fellow trial lawyer cronies have borrowed a page from the same playbook. A group of trial lawyers is representing six coastal parishes against the oil and gas industry in 42 absurd lawsuits alleging that drilling and the cutting of canals as far back as 80 years ago are responsible for coastal erosion.

There’s no proof to support their claim, yet they still hope to win. That’s because, with a judicial system overrun with trial lawyers and judges elected with their generous campaign contributions, the need for proof may be superfluous.

“The governor has unilaterally and, according to some critics, unlawfully sought to hire some of the state’s wealthiest plaintiffs’ lawyers to run the energy industry-targeting litigation,” the American Tort Reform Foundation’s “Judicial Hellholes” report noted.

To appreciate the chief cause of the state’s coastal erosion problem, it’s important to understand that the U.S. Army Corps of Engineers has long maintained a network of levees that protect the Louisiana Delta region from flooding. On the plus side, this works well in mitigating floods. On the negative side, it works too well in preventing the flooding of the environmentally sensitive coastal wetlands. The occasional flood is crucial in maintaining the wetlands. Deposits of Mississippi River silt accumulate, building up the land. By starving the wetlands of sediment, the levees become a major contributor to coastal erosion.

But despite the known effects of levees, the greedy trial lawyers are only targeting the oil and gas industry, which has been a key driver economic growth in Louisiana for over 100 years. The industry has generated uncounted billions of dollars in royalty payments to Louisiana landowners and tax revenues for state and local governments as well as providing hundreds of thousands of high-wage jobs to generations of Louisianans. Today, that prosperity is under threat, not from the federal government or even low oil prices, but from Louisiana’s own governor, his trial lawyer donors, and the abuse of the legal system.

Abusive lawsuits are a familiar scourge in Louisiana. The U.S. Chamber of Commerce Institute for Legal Reform ranks Louisiana dead last in its most recent report on state legal climates. When Edwards was elected governor in November 2015, Louisiana was ranked 7th best for doing business. But the litigious, anti-business environment he helped foster has sent the state into an economic free fall. Just two years removed from the gubernatorial election, “No state is worse for business than Louisiana,” according to a 24/7 Wall St. survey.

If the cases remain in Louisiana state courts, it is also not likely to matter that many of the energy projects were undertaken with state incentives and subjected to rigorous regulation. What does matter is that the trial attorneys see the oil and gas industry as a fat cash cow, potentially worth billions. That’s unfortunate for the working people of Louisiana who rightly view the industry as a golden goose, providing high-paying jobs and a substantial tax base.

One way for justice to prevail would be for these cases to be moved to federal courts — where judges are not running for re-election and not prejudiced by special interests. A previous frivolous lawsuit over this issue from the Southwest Louisiana Flood Protection Authority was dismissed by a federal district court in 2015. The decision was upheld by the 5th Circuit and then the Supreme Court just this year. The recent flood of lawsuits instigated by Edwards have no more merit than that case. That’s why the trial lawyers will fight hard to keep the legal venue from being moved out of state courts, knowing that it spells the end of their shakedown.

For the rest of the nation, this is a cautionary tale on the need to keep lawsuit abuse in check. Meanwhile, the people of Louisiana must take back their state from the trial lawyer junta that thwarts a fair and impartial legal system and drives business and jobs away.

Thomas Pyle
President of The American Energy Alliance

To speak out against these misguided lawsuits, click here. 

Thank You, Don Briggs, for Your Steadfast Commitment to Louisiana’s Oil and Natural Gas Industry

As you may have seen, Don Briggs announced yesterday that he will transition out of his role as President of the Louisiana Oil & Gas Association (LOGA) to pursue other ventures on behalf of the industry.

As an American oilman and as President of LOGA, Don Briggs is a respected champion for the most important industry in Louisiana. Don is Louisiana oil and gas. His passion for our industry has always been contagious. He is the role model for the tens of thousands of supporters working to build a brighter future for the industry in our state. Don and LOGA are original partners of the Grow Louisiana Coalition, and we are proud to continue to stand with them in advocating for an industry that represents a way of life for 300,000 of our neighbors, families and friends.

However, our collective work is far from over. The Grow Louisiana Coalition looks forward to continuing our partnership with incoming LOGA President Gifford Briggs. We are also excited to continue our work with Don as he furthers his mission to help Louisianians from every corner of the state fight for better oil and natural gas opportunities here.

Thank you, Don.

Louisiana Lawsuits Try to Put Oil Industry on Trial for Following the Law 80 Years Ago

Via InsideSources

Louisiana’s economy has benefited a lot from the energy industry. For decades, oil and natural gas wells in the Gulf of Mexico, as well as the refining and other support industries on shore, have given the state billions of dollars in tax revenue. At the same time, various conservation groups and other special interests in the state have worried about the effects of the industry, including oil spills and coastal erosion. For decades, regulators have tried to mitigate these harms through permitting policies which have become more extensive over time. Now 2018 is shaping up to be a year where oil companies operating in the Gulf will be forced to justify their practices in court without any specific violations being in question.

Twenty coastal parishes (out of a total of 60 in the state) are filing lawsuits against oil companies who either are operating or did operate in the area. The lawsuit is surprising in its breadth. Each company is being sued individually and the list of names includes both major companies like Chevron, Shell, BP, and ExxonMobil, as well as smaller companies that no longer operate in the area. In part, the lawsuit looks back to the 1930s, when development in the area began.

The case is not the first one to go after the industry for coastal erosion. One of the first cases filed against oil companies seeking damages for coastal erosion was filed in 2013. That case sought to force the oil companies to pay to fill in canals and restore wetlands. The lawsuit was soon joined by others, but the entire process became bogged down in the courts.

Louisiana Gov. John Bel Edwards, a Democrat, has brought the lawsuits back into play, laying the foundation for what could cost the industry tens of billions of dollars and earn trial lawyers hefty fees. In May 2016, Edwards met with representatives of more than 30 companies, asking them to settle and pay to repair damages in coastal counties.

To the industry, this meeting was fundamentally flawed, since it did not include any attempts to discuss a reasonable liability structure. Under Louisiana state law, there are no damage caps on this type of liability lawsuit. Instead, a plaintiff can, in theory, recover more than the market value of the property in damages. In addition, state law allows for “legacy” lawsuits against companies that had developed an area previously, but are no longer working there.

In August, trial settings for some of the lawsuits were established. An attorney for one of the oil companies, speaking on background, said that one judge even announced that he was clearing his 2019 docket to hear these cases. This is concerning for the oil industry, which is still fighting to have the cases thrown out or shifted to federal court.

The oil industry is contesting the lawsuits, arguing that coastal development complied with all necessary regulations in place at the time the permits were issued. Most oil development in the coastal region occurred before the current regulatory structure was put in place in the 1980s. Between 1930 and 1980, the companies operating in this zone complied with the regulations in place at the time.

In addition, development in the coastal zone is managed by the Coastal Zone Management Act, a federal law. Attempts to shift the lawsuits into federal court, in reflection of this, have so far been unsuccessful.

At these early stages, arguments are centering around the parameters of the case. One of the issues at play is “broad discovery,” which would allow the state access to oil company files. This is vary similar to the discovery orders at the heart of the ExxonKnew campaigns in New York and Vermont.

Supporters of energy development are also suspicious of Edwards’ close ties to Louisiana’s community of trial lawyers, particularly Glad Jones, an attorney in New Orleans who litigates environmental and commercial cases. In 2006, Jones won what was then the largest judgement against an oil company in Louisiana’s history: $57 million in damages for pollution and marshland loss against ExxonMobil. Jones is also a strong campaign supporter of Edwards.

Edwards’ office did not respond to multiple requests for comment.

The most recent set of lawsuits has the potential to increase the cost of doing business in Louisiana even more than that. For an industry that is tied to specific geological deposits that cannot be moved, the regulatory structure of Louisiana has made doing business increasingly difficult. The start of 2018 shows that Louisiana’s fraught relationship with energy development continues.