Offshore Magazine - May - June 2023

May/June 2023
WORLD TRENDS FOR OIL, GAS & RENEWABLE ENERGY
DRILLING RIG MARKET UPDATE

Global rig market tightens as
inventory declines, demand increases
Annual rig survey shows that ten
largest rig contractors have taken on
increased market share
PLUS:
NORTH SEA
Tax regime impact
on drilling
GEOSCIENCES
Seismic survey market
on the upswing
ESG FOCUS
Green hydrogen
pilot project
SPECIAL REPORT
Remote operations
COMMENTARY
Rise of the robots
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TECHNOLOGY
TRENDS
Exploring the Future of

Maritime Innovation
Download your copy today
at www.eagle.org/techtrends
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5/10/23 8:46
2:38 AM
PM
MAY/JUNE 2023
DECOMMISIONING
22 Production data underpins successful

worldwide ARO analysis
Planners should understand relationship between
asset retirement obligations, production rates
ESG FOCUS
COVER STORY: DRILLING RIG REPORT
12 Top 10 offshore rig managers

expand their dominance
26 Green hydrogen platform enters harsh
environment offshore test phase
Production module expected to be
China Oilfield Services Ltd continues to hold onto top spot
deployed to an open-sea test site soon
15 Adrilling
tale of two North Seas: Norway incentivizes
while UK levy could lead to rig loss
Global demand for harsh environment semis
may pull rigs from UK North Sea
GEOSCIENCES
18 Seismic survey market finally recovering

Analysts says seismic market upturn is in full swing
COVER: The deepwater, harsh-environment

semisubmersible drilling rig Hercules will be
FOLLOW US
mobilizing to eastern Canada before heading
to offshore Namibia later this year. (Photo FACEBOOK TWITTER LINKEDIN
by Ole Jørgen Bratland, courtesy Equinor) @OffshoreMagazine @offshoremgzn www.linkedin.com/groups/4542757
MAY/JUNE 2023 | www.offshore-mag.com OFFSHORE 1
2305_06OFF01-03_toc_online.indd 1 5/22/23 8:46 AM

MAY/JUNE 2023
SPECIAL REPORT:
REMOTE INSPECTIONS & OPERATIONS
30 The rise of remote operations in
OVERVIEW
the offshore energy industry

Offshore operations are being
revolutionized with remote technologies
32 Autonomous drone technology

DRONES
increasing efficiencies of
offshore platform inspections
Autonomous drones are lowering risk while 41 Affordable offshore well
REMOTE-CONTROLLED OPERATIONS
increasing data quality and efficiency for monitoring lowers P&A costs
complex offshore platform inspections Digital innovations are driving adoption
of satellite-powered monitoring
33 Transforming offshore operations: The

ROBOTICS
rise of autonomous inspection robots

Autonomous inspection robots have the
42 Remote survey services reducing
project carbon footprint,
potential to transform offshore asset monitoring
mobilizations and costs
Sophisticated communications
35 Executive insights: Remote operations

AUV/ROV hardware provides connectivity
to bring data processing ashore
and reduce survey costs
are evolving with ROV/AUV advancements
43 Opinion: Nigeria needs
Oceaneering executive details the challenges
and solutions of remote operations
to take the leap toward
adopting digital twins
38 Advanced ROV vision systems are
the future of subsea operations
New technology employs edge computing
Digital twins provide a blueprint for
overcoming the gaps in Nigeria’s oil
and gas digital transformation journey
to capture high-quality stills images
44 AIunplanned
in tandem with low-latency video
tools improving HSE, reducing
downtime
39 Autonomous robots use AI for data
collection and intervention services AI is unequivocally transforming
offshore operations
AI streamlines subsea operations,
DEPARTMENTS
45 Examining
enhances productivity and safety
an evolution in FPSO
autonomous operations
40
3 ONLINE Troubleshooting problems has become
A new project is underway to
4 COMMENT a more manageable process advance safety performances
5 DATA C-I performs remote survey work offshore of a global FPSO fleet
Guyana from its Louisiana headquarters
6 GLOBAL E&P
8 SUBSEA SYSTEMS
9 RIGS & VESSELS
1 1 GULF OF MEXICO
46 BUSINESS BRIEFS
47 ADVERTISERS’ INDEX
48 BEYOND THE HORIZON
2 OFFSHORE www.offshore-mag.com | MAY/JUNE 2023

OFFSHORE-MAG.COM LATEST NEWS Vol. 83, No. 3
The latest news is posted daily for the offshore energy industry covering technology, companies, personnel moves, and products. GROUP PUBLISHER Diana Smith
dsmith@endeavorb2b.com
CHIEF EDITOR/CONFERENCES EDITORIAL DIRECTOR
VIDEOS WWW.OFFSHORE-MAG.COM/VIDEOS David Paganie
dpaganie@endeavorb2b.com
MANAGING EDITOR Bruce A. Beaubouef
bbeaubouef@endeavorb2b.com
EDITOR-EUROPE Jeremy Beckman
jbeckman@endeavorb2b.com
EDITOR and DIRECTOR OF
SPECIAL REPORTS Ariana Hurtado
ahurtado@endeavorb2b.com
POSTER EDITOR E. Kurt Albaugh, P.E.
Kurt.albaugh@yahoo.com
ART DIRECTOR Meg Fuschetti
The search for alternative marine fuels Top 5 projects to watch in 2023
PRODUCTION MANAGER Josh Troutman
Rig operators and vessel owners are The five projects were selected on the jtroutman@endeavorb2b.com
hoping to reduce their emissions through basis of upcoming FID, and also use of AD SERVICE MANAGER Shirley Gamboa
the use of ammonia, hydrogen, methanol, unique technologies, innovative solutions, sgamboa@endeavorb2b.com
biofuels, compressed natural gas, and LNG and renewable energy components. AUDIENCE DEVELOPMENT MANAGER Emily Martin
WWW.OFFSHORE-MAG.COM/14292469 WWW.OFFSHORE-MAG.COM/14290806
endeavorbusinessmedia.com
Corporate Officers
CEO Chris Ferrell
PRESIDENT June Griffin
CFO Mark Zadell
COO Patrick Raines
CRO Reggie Lawrence
Deepsea mining – opportunities Offshore wind energy and the CHIEF DIGITAL OFFICER Jacquie Niemiec
and challenges problem of global stilling CHIEF ADMINISTRATIVE AND LEGAL OFFICER
Tracy Kane
The energy transition is driving The phenomenon of “global terrestrial
EVP INDUSTRIAL GROUP Mike Christian
demand for resources that deepsea stilling” may pose a significant reality
Offshore Customer Service:
mining may be able to extract. check on the offshore wind industry. P.O. Box 3257, Northbrook, IL 60065-3257
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COMMENT
Oil, gas investment is core

to energy transition
energy company, but still plans to invest up to $8
billion of new capital through 2030 on oil and gas
short-cycle, quick return opportunities with low
carbon emissions, and on existing assets that can
benefit from life extension.
Petrobras has increased its planned oil and
gas E&P investments to $64 billion for the period
2023 – 2027, up from its previous five-year invest-
David Paganie ment plan. The strategic plan calls for up to 18 new
CHIEF EDITOR
FPSOs, and some may be equipped with all-elec-
T
he critical role of oil and gas supply for an tric topsides that could lower emissions by up to
orderly energy transition has never been in 30%. Both Petrobras and BP are investing in tech-
question to those that work in the industry. nologies to lower the carbon footprint of their oil
But in recent years, policy and social chang- and gas assets.
es, and investor ESG requirements, have influenced Hess has allocated $3.7 billion this year for its oil
structural changes within many operating compa- and gas E&P capital and exploration budget, with
nies. Part of the changes are related to corporate more than 80% of it directed to its developments
marketing and external messaging. Many compa- offshore Guyana. The operator strategically targets
nies have changed logos, branding, and messaging what it considers to be high margin and low carbon
to support new strategic objectives. intensive prospects in high growth basins.
One important message that has been seeming- Shell talked at OTC extensively about how it
ly muted within these communication efforts is adapted to a new business environment to bring
the critical role of oil and gas in the energy tran- its Vito project in the deepwater Gulf of Mexico
sition. This is changing, as the geopolitical events to first production earlier this year. And now it is
of 2022 have reinforced the need for balance in applying lessons from Vito to Whale, its next deep-
energy security, affordability, and sustainability. water GoM project.
Fossil fuels still account for about 80% share of The best way forward for deepwater to be con-
primary energy needs, and oil demand is expect- sidered more sustainable – and essential to long-
ed to reach a record high by the end of this year. term corporate investments plans – is to co-locate
It was encouraging to see oil and gas technolo- the resources with renewables and CCS, according
gy presentations as a big part of the agenda of this to Julie Wilson with Wood Mackenzie. She calls
year’s Offshore Technology Conference. One session these co-located basins “energy super basins”
addressed the role of deepwater in the energy tran- of the future.
sition. All the panelists, including three from oper- Still, oil and gas continue to be core to the tra-
ators – BP, Petrobras, and Hess – pointed to oil and ditional operator’s investment strategy; the differ-
gas as the core component of their energy invest- ence today is the level of comfort in voicing the
ment plans. BP is transforming into an integrated corporate imperative.
To respond to articles in Offshore, or to offer articles for publication, contact the chief editor at dpaganie@endeavorb2b.com.
2305_06OFF04_comm.indd 4 5/22/23 8:46 AM

DATA
Slower rig contracting activity Offshore rig fixtures
For jackups, both the contract duration and 140
number of fixtures announced in Q1 2023 are Q1 2022 duration (rig-years)
down from Q1 2022. Most 2022 jackup work 120 Q1 2023 duration (rig-years)
was for the Middle East, where operators are Q1 2022 fixture count
working to get many of these rigs operating, 100 Q1 2023 fixture count
which has slowed 2023 contracting activity

so far. For semis, the number of fixtures 80
in Q1 2023 was a little below Q1 2022, but
60
the duration was up as charter terms are
lengthening, notably for Norway, UK and
40
Mexico. Drillships saw the most increase in
duration over Q1 2022 and were the only rig 20
type to record more fixtures. Drillship time
booked in Q1 2023 was triple that of Q1 2022 0
Jackup Semi Drillship
mainly due to multiple awards for Brazil and
new work in the US Gulf.—Esgian Source: Esgian Rig Analytics
Vessel supply to fall short Turbine demand & supply forecast

In Vessel Years | 2023–2030 41
Spinergie predicts 200 GW of offshore wind
demand by 2030, a sevenfold increase.
A key challenge in meeting this demand Extra O&M
43%
is insufficient supply of installation and < 11 MW
maintenance vessels. While the jackup 11–15 MW
(WTIV) fleet will see three to four units enter > 15 MW
22
the market by 2027, the floater fleet will see
the older O&G legacy fleet bolstered by 17 17
31%
newbuilds and conversions. More vessels are
12
required to meet demand for offshore wind 11 50%
installation and maintenance. The market 7 94% 94%
7 13%
requires the building of small O&M jackups, 57%
29% 97%
or alternative solutions, to reduce pressure 71%
78%
17% 13%
30%
on installation-capable vessels. Without such
Demand Supply Demand Supply Demand Supply Demand Supply
measures, reaching 2030 global offshore wind 2023 2025 2028 2030
energy targets may be impossible. —Spinergie Supply: Accounting for newbuilds, and newbuild contracts in option and under discussion. Source: Spinergie
OFS revenue growth improves Year-on-year growth rate of key financial parameter
SLB, Baker Hughes and Halliburton are on for major OFS trio
SLB
course for strong financial performances in 40% 600%
Halliburton
the coming quarters after the trio of oilfield 540.3%
Baker Hughes
services (OFS) giants all posted a sparking set 29.8%
32.5%
2.1%
3.6%
500%
of results for the first three months of the year. 30%

400%
All three posted improved topline numbers, 344.0%
margins and cash flow in Q1 2023 compared 20% 18.2% 0.8% 300%
to Q1 2022. The trio has focused on returns to
shareholders and increasing dividends, with 200%
151.9%
two hatching a share repurchase plan for the 10%
100%
year. Market fundaments necessary for OFS 34.9% 41.8%
49.2% 42.3% 34.3%
11.6%
players to boost their financial performance 0% 0%
will remain strong for the rest of the year. Jackup Incremental adjusted CFO Capex Dividends paid
EBITDA* margin
—Rystad Energy
Note: Results of Baker Hughes includes both its business segments. Year-on-year
calculation based on 1Q 2023 and 1Q 2o22
*EBITDA: earnings before interest, tax, deprecition and amortization Source: Rystad Encergy ServiceCube — Oil & Gas
2305_06OFF05_data.indd 5 5/22/23 8:46 AM

GLOBAL E&P Jeremy Beckman london
NORTH AMERICA block off Guyana, in 2,000 m water depth. MODEC is constructing
KBR has a Letter of Intent from Equinor to perform the topsides the 250,000 b/d FPSO, named Errea Wittu: this will be connected to
FEED for a newbuild FPSO for the Bay du Nord project offshore 44 production and injection wells at up to 10 subsea drill centers.
Newfoundland. This will produce oil from various discovered fields Technip FMC will supply the subsea trees, 12 manifolds and associ-
in 650-1,170 m water depth in the Flemish Pass basin, 500 km ated controls and tie-in equipment, while Saipem will design, fabri-
north-east of St. Johns. KBR’s scope of work includes supporting cate and install the connecting SURF facilities, using its FDS2 and
Equinor with development of a combined cycle power system and Saipem Constellation vessels for the offshore campaign. Recent-
other technologies to minimize the platform’s emissions and crew ly, the Stabroek licensees boosted their reserves with the Lan-
complement and maximize the use of digital solutions. Equinor is cetfish-1 discovery well, drilled by the Noble Don Taylor drillship.
targeting first oil in the late 2020s.
Petrobras has produced first oil from its revitalization project at the
The Canada-Newfoundland and Labrador Offshore Petroleum post-salt Marlim and Viador fields in the Campos basin off Brazil.
Board has included 28 parcels off eastern and south-eastern New- The FPSOs Anna Nery, which started operations last month, and
foundland in its latest Call for Bids, which will remain open until MODEC’s Anita Garibaldi MV33, are replacing nine platforms on the
November 1. Exploration licenses for successful applicants could two fields and should eventually deliver 150,000 boe/d combined.
be awarded early next year.
The company is also part of the Equinor-led consortium that has
Shell Offshore has commissioned Worley to perform FEED and just taken FID on a $9.9-billion development in Block BM-C-33 in
detail design studies for a lightweight floating production platform the pre-salt Santos basin, covering three accumulations discov-
at the Sparta development, 170 mi off the Louisiana coast. Shell ered by Repsol in 2010. Collectively, Pão de Açúcar, Gávea and Seat
deployed Worley’s concept for two previous platforms: the compa- hold over 1 BBoe recoverable: Repsol Sinopec Resources is the
ny and partner Equinor expect to take FID on Sparta later this year. other member of the current consortium. Plans call for a 126,000
b/d FPSO with a gas production capacity of 16 MMcm/d, and facil-
Wintershall Dea’s recent Kan discovery in Mexico’s offshore Sur- ities topside to process the gas and oil/condensate and specify
este basin could hold up to 300 MMboe in place, initial analysis these for sale without the need for further onshore processing.
suggests. The well, drilled by the Borr Ran jackup 25 km from the
Tabasco coast in 50 m of water, encountered over 170 m net pay
sands in the Upper Miocene. The Block 30 consortium, which
includes Harbour Energy and Sapura OMV, will finalize an apprais-
al plan by the end of July.
Pemex has submitted a Unit Development Plan (UDP) for the giant
Zama oilfield to Mexico’s National Commission of Hydrocarbons
(CNH) for approval. Zama extends across two contiguous blocks:
Pemex and the Block 7 partnership of Talos Energy, Wintershall
Dea and Talos Energy agreed to form an integrated project team
to take the development into the construction phase. Main com- Proposed field layout for the BM-C-33 project
ponents of the UDP are two fixed platforms, 46 dry-tree wells and in the Campos basin. COURTESY EQUINOR
two 68-km subsea pipelines exporting the oil and gas to new pro-
cessing facilities at the onshore Maritima Das Bocas terminal. Sales gas will be exported through a 200-km offshore pipeline
to reception infrastructure at the Cabiúnas terminal onshore in
Macaé, with processed liquids offloaded via shuttle tankers.
SOUTH AMERICA
McDermott is working on the FEED for Shell’s Manatee gas
development offshore Trinidad and Tobago, said to be one of the
WEST AFRICA
country’s largest discoveries. The work scope covers a wellhead The refurbished FPSO Baleine (ex-Firenze) has sailed to Côte d’Ivo-
platform, export pipeline system shore approach, midstream pipe- ire for service on Eni’s Baleine field development in blocks CI-101
line and onshore control room. and CI-802. Following the upgrades, the facility can process up
to 15,000 b/d of oil and around 25 MMcf/d of associated gas, with
ExxonMobil and its partners have taken FID on the$12.7-billion the latter to be exported to shore through a new subsea pipeline.
Uaru project, their fifth FPSO-based development in the Stabroek Eni aimed to start production this month, less than two years
2305_06OFF06-07_glob.indd 6 5/22/23 8:46 AM

after the Baleine 1X discovery well, and is also progressing Phase 350 MMcf/d from the 10 subsea wells. Wood Mackenzie claimed
2 towards start-up in December 2024. an expanded Phase Two development could supply almost 30%
of the country’s gas needs by 2030.
AFC Equity Investment, owned by Africa Finance Corp, has nego-
tiated a deal that makes it the sole shareholder in Aker Energy,
which has a 50% operated stake in the Deepwater Tano Cape
MEDITERRANEAN SEA
Three Points block offshore Ghana. Aker Energy has since sub- Panoro Energy has agreed to acquire Beender Tunisia Petroleum’s
mitted a Plan of Development to the Ghanaian Authorities for a 40% stake in Sfax Petroleum Corp (SPC) for around $18 million.
phased project, initially focused on an FPSO and subsea pro- As SPC’s new outright owner, Panoro gains control of the Sfax
duction system on the Pecan field, 115 km offshore and in water Offshore exploration permit in the Cretaceous and Eocene car-
depths of 2,400-2,700 m. bonate platforms of the Pelagic basin. The permit contains three
oil discoveries with combined recoverable reserves estimated at
Aker Solutions will supply deepwater standard and configurable 20 MMboe and numerous prospects and leads with potentially
subsea production systems to TotalEnergies for three infill wells much larger resources.
tied back to the Moho Nord field center off Republic of Congo.
Moho Nord, 75 km offshore in 750-1,200 m of water, came onstream BP and Wintershall Dea have commissioned the Subsea Inte-
in March 2017 and is the country’s largest oil project to date. gration Alliance (Subsea 7 and One Subsea) to supply and install
subsea equipment for the two-well Raven Infills tieback proj-
Tullow Oil and Perenco have signed an asset swap agreement ect in Egypt’s offshore West Nile Delta block, in water depths of
covering offshore and onshore fields in various licenses in Gabon. around 800 m.
For Tullow, the arrangement would allow it to optimize its equity
ownership in the offshore Tchatamba field cluster which it would
seek to develop as a new core production hub.
NORTH SEA
Shell U.K. expects the FPSO Haewene Brim to produce more than
30,000 boe/d at the Pierce field in the UK central North Sea fol-
lowing upgrades at Aibel’s yard in Houston. The project will switch
production from Pierce, which came onstream in 1999, from oil Subsea 7 will install the subsea infrastructure for the
alone to gas and oil, with the gas exported through a new subsea Raven Infills project offshore Egypt. COURTESY SUBSEA 7
pipeline connecting to the SEGAL pipeline system and onward to
the St Fergus terminal north of Aberdeen. ADNOC and bp have jointly offered to acquire a 50% interest from
Delek Group in NewMed Energy, a partner to Chevron in the Levi-
NEO Energy is set to take control of the Greater Buchan Area athan and Tamar gasfields offshore Israel. If accepted, this could
licenses in the central UK sector after negotiating a 50% farm-in represent the first step of their plan to form a joint venture com-
with current operator Jersey Oil & Gas (JOG). With NEO agreeing pany focused on gas developments, including in the East Medi-
to part-fund JOG’s costs, this opens the way to a redevelopment terranean region.
of the shut-in Buchan oilfield and a phased development of vari-
ous other discoveries in the area.
ASIA-PACIFIC
BlueNord (formerly Noreco) has applied for a license in the Danish Valeura Energy has resumed oil production from the Wassana
sector containing the Elly-Luke gas discovery. If successful, an field in the Gulf of Thailand, which had been shut down prema-
award could follow later this year, with work then starting on a turely by previous operator KrisEnergy in 2020. Output has been
technical review ahead of a possible 5-bcm development. In addi- ramping up steadily as the wells are activated sequentially, and a
tion, BlueNord has formed a partnership with Semco Maritime to planned infill drilling campaign in Q3 could add a further 5,000 b/d.
assess other oil and gas development opportunities, including
taking on operation of existing fields. Shell Australia has agreed to sell its interests in the Woodside-op-
erated Browse project offshore north-west Australia to bp. The
Browse Joint Venture has been seeking a development solution
BLACK SEA for the Brecknock, Calliance and Torosa fields 425 km north of
Turkish Petroleum Corp (TPAO) has started production from Broome in the Browse basin. Woodside’s last update revealed a
Sakarya, Turkey’s first deepwater gasfield development. The Phase preference for two LNG/LPG/gas FPSOs and a 900-km export
One subsea-beach facilities came onstream only two and a half pipeline connecting to infrastructure serving the North West
years after the discovery in August 2020, and should deliver up to Shelf Project. ●
2305_06OFF06-07_glob.indd 7 5/22/23 8:46 AM

SUBSEA SYSTEMS Ariana Hurtado houston
Overcoming unfavorable conditions

during ROV pipeline inspections
COURTESY ADVANCED NAVIGATION

Last year was a busy one for Advanced into a miniature titanium enclosure
Navigation, an AI-based navigation small enough to fit in the palm of your
and robotics specialist, as it released hand, Baker said. It runs fully on the
two new technologies: the Boreas D70 processor within the transceiver and
fiber-optic gyroscope inertial navi- is accessible via a web browser, with
gation system and the Hydrus fully no additional rack-mounted interface
autonomous subsea drone. Plus, it just units or processing PCs.
recently announced its investment in a
new subsea robotics center in Australia. Case study
Discussing current subsea systems JM Robotics was tasked with carry- viable solution that had the necessari-
challenges, Peter Baker, senior product ing out a submarine pipeline inspec- ly small physical dimensions and mini-
manager, told Offshore that a common tion for a major energy provider. The mal weight for the project,” Baker said.
challenge the company’s customers challenge was developing an agile, “Complementing this, the straightfor-
face is when depths and other condi- miniature ROV that provided accurate ward installation and connectivity of
tions are not favorable. acoustic heading and absolute position the Subsonus made the system easy for
“Subsea pipeline inspection is crit- in difficult shallow-water conditions. the team to set up, test and verify for
ical to the safe transfer of oil and gas “For JM Robotics, the first challenge both ROV and surface vessel.”
from offshore rigs to storage and pro- was to design an ROV that could oper- As a result, the company received
cessing facilities on land. Typically, ate in shallow depths and be deployed accurate ROV navigation using acous-
large and heavy work-class ROVs are by two crew members, while the ROV tic heading. The Acoustic Compass
used for this purpose; however, these was meant to reduce carbon emis- heading provided by Subsonus in
ROVs remain suited to large-scale oper- sions, expenditure, vessel and crew USBL2 configuration meant that the
ations and at suitable depth,” he said. sizes,” Baker said. “The maximum ROV ROV project is commercially viable.
“For example, as the water becomes weight was capped at ~50 kg (in air). “JM Robotics found that using
shallower or the environment more The requirement for lightness imme- Subsonus immediately provided the
sensitive to larger vessels, complica- diately discounted a range of compo- additional navigation functions and
tions arise in getting appropriately nents that are either too big and/or accuracy that they required,” he con-
sized and maneuverable equipment into heavy or would otherwise compro- cluded. “This particular application
place. The situation might entail using mise manoeuvrability of the ROV.” requires complex ROV piloting, using
divers or perhaps not surveying at all.” Johan Hellstrøm, JM Robotics six degrees of freedom of movement,
As a result, he said more companies technical manager, added, “This was to follow the hidden pipelines and suc-
are moving toward small-scale ROVs more challenging than we expected cessfully battle currents and avoid vari-
to reduce overall costs, carbon emis- because of poor or no visibility, a lot ous obstacles. This makes ROV heading
sions, vessel and crew sizes. However, of current, [and] shallow water with even more essential to the solution. ROV
this results in the challenge of sourc- obstacles such as fishing nets. The piloting is also improved when visibil-
ing a subsea navigation system that pipes are magnetic also. There were ity becomes difficult, with Subsonus
is appropriately sized, easy to install, also disturbances due to boat engines providing continuous position and
and doesn’t affect performance or and water jets that needed to be han- acoustic heading data regardless of
maneuverability, he added. dled without disrupting the USBL or water turbidity. An added benefit is
Advanced Navigation has developed sensors. There were a lot of very diffi- that having accurate ROV position
Subsonus USBL2, a miniature underwa- cult situations.” and heading can provide additional
ter acoustic positioning system that is The small size of the JM Robotics safeguards against collisions which,
designed to provide high-accuracy HD3 ROV necessitated using an particularly in resource extraction
position, velocity and heading at ranges ultra-compact USBL2 system that applications, can be devastating to
of up to 1,000 m. The system features would not impede maneuverability the environment.” ●
a calibrated hydrophone array com- or affect buoyancy of the vehicle.
bined with an internal tightly coupled “In this case, Advanced Navigation’s Editor’s note: Read an extended version of
inertial navigation system, all packed Subsonus was found to be the only this article at offshore-mag.com/14293561.
2305_06OFF08_sss.indd 8 5/22/23 8:54 AM

VESSELS/RIGS Bruce Beaubouef houston
Arrival of eighth-generation drillships to the

Gulf of Mexico heralds new era in HP/HT drilling
The era of high-pressure, high-tem-
perature development in the Gulf of The Deepwater Titan is the world’s
Mexico has arrived. After years of first drillship delivered with two
research, study, investment, and field 20,000-psi BOPs, well-control, riser,
and piping systems for high-
experimentation, the technology pressure and high-temperature
has been developed that enables off- drilling and completion operations.
shore drillers to take on challenging COURTESY TRANSOCEAN
HP/HT fields.
Transocean announced the arriv-
al of its eighth-generation drillships
Deepwater Atlas and Deepwater Titan to
the Gulf in 2022 and 2023, respectively.
The Deepwater Atlas and Deepwater
Titan are the world’s first eighth gen-
eration ultra-deepwater drillships
and only rigs to feature a three-mil-
lion-pound hook-load. Importantly,
these drillships also include the first
20,000 psi well control system, a
feature that has important implica-
tions for deepwater Gulf of Mexico
development.
High-pressure, high-temperature
reservoirs have been a challenge for
Gulf E&P for the past decade or more.
Overcoming the HP/HT challenge,
at least on the drilling front, stands
to be hugely important for the US
Gulf of Mexico as a producing region
going forward.
Recently, Offshore spoke w ith
Marijana Sosic, Manager, Technical
Marketing, with Transocean. She
offered some thoughts about the capa-
bilities of the new rigs, and what they
mean for Gulf of Mexico and deepwa-
ter development going forward.
Offshore: Can you talk about how these

rigs came to be, and their origins?
Sosic: While Deepwater Atlas and
Deepwater Titan were or ig ina l-
ly ordered in 2014 just before the
industry downturn, these two proj- a rig capable of drilling in 20,000 construction management contract,
ects shifted in 2018 when one of our psi environments – the new fron- and a five-year drilling contract,
customers approached us with an tier of ultra-deepwater drilling. As we shifted gears and got to work to
opportunity to design and construct a result of the new rig design and accomplish the design, construction
2305_06OFF09-10_vess.indd 9 5/22/23 8:46 AM

and delivery requirements set forth world, top drives and rotary tables
in the construction contract. were installed. Increased hoisting
As a result of these design changes, capacity will provide our customers
both the Deepwater Atlas and Deepwater with numerous cost and time-sav-
Titan became the first of their kind – ing opportunities, especially when
eighth-generation drillships – offer- drilling programs and well configu-
ing 20,000 psi well control capabilities rations, such as HP/HT wells, require
and a 3.4-million-pound hoisting the handling of heavy, large-diame-
capacity, the highest rated equipment ter casing strings.
The Aluminium in the industry. This newest genera- Well control equipment upgrades
tion of ultra-deepwater drillships will to safely access 20,000 psi reser-
TwixBeam allow Transocean, and its customers, voirs were required and an industry
to access high pressure and high tem- first 20,000 psi BOP was engineered
THE SMART BEAM IN SCAFFOLDING perature reservoirs that previously (prototyped), built and installed, as
2 The TwixBeam is the high-strength and multifunctional were not accessible. The equipment well as the 20,0000 psi rated choke
aluminium beam for every requirement. on our newest drillships, in addition, manifolds designed for high pres-
can reduce the time it takes to drill a sure drilling, cement manifolds and
2 Low weight, easy dismantling and high strength.
deepwater well, bringing total costs cementing unit, and associated riser
2 It fixes, stabilises, bridges and connects.
down for our customers. string modifications. This equipment
2 The TwixBeam has surprising variability and flexibility. For context, seventh-generation was designed and delivered specifi-
rigs offer 2.5-to-2.8-million-pound cally for these projects – marking new
hoisting capacity, and 15,000 psi firsts, not only for Transocean, but for
well control systems, while operat- the entire industry.
ing in water depths up to 12,000 feet.
Sixth-generation rigs offer a hoisting Offshore: What does the arrival of
Learn more: capacity of up to 2.0 million pounds these two drillships mean to GoM
http://yt-twixbeam-gb-en.layher.com and are rated for water depths up to development going forward? To u ltra-
10,000 feet. deepwater drilling?
Sosic: Given that Deepwater Atlas
Offshore: Can you elaborate on how the and Deepwater Titan are the only
equipment on the two drillships is specifi- two eighth-generation assets in the
cally designed to drill and complete these world, we are quite excited about
HP/HT wells? the expanding list of opportunities
Sosic: Transocean’s eighth-genera- requiring the extraordinary capabil-
tion drillships are the only two assets ities of these rigs.
in the world specifically designed to Transocean has a long history of
maximize efficiencies for 20,000 psi introducing new technologies that
well completions. The vessels and enable our customers to safely and
marine risers have been outfitted efficiently access the world’s most
for 20,000 psi well control capabil- challenging reservoirs. We are proud
ity, including cement systems, inte- to be adding to that history by deliv-
gral hull piping, and riser choke and ering the industry’s first two rigs
kill auxiliary lines. The Deepwater capable of drilling and completing
Titan is outfitted with two 20,000 wells requiring subsea equipment
psi BOPs, while the Deepwater Atlas rated to 20,000 psi and offering the
is outfitted with two 15,000 psi BOPs, industry’s highest hookload capaci-
one of which will be replaced with a ty. We are extremely excited about
20,000 psi BOP later this year. Both the initial campaigns in the Gulf of
rigs possess a 3.4-million-pound Mexico for the Deepwater Atlas and
hoisting capacity. To provide this the Deepwater Titan, and look for-
hoisting capability, upgrades had to ward to continuing to deliver safe,
be made to the derrick structure and reliable and efficient drilling opera-
a new active heave compensating tions for all our customers across our
drawworks, the highest-rated in the global fleet.
2305_06OFF09-10_vess.indd 10 5/22/23 8:46 AM

GULF OF MEXICO Bruce Beaubouef houston
bp affirms commitment to Gulf of Mexico with

startup of Argos platform
With a series of announcements made this year, bp has
shown its commitment to E&P in the US Gulf of Mexico.
In mid-April, the company reported that it had success-
fully started oil production at its Argos offshore platform,
delivering more energy at a critical time and strengthen-
ing its position as a leading producer in the deepwater US
Gulf of Mexico.
With a gross production capacity of up to 140,000 bar-
rels of oil per day, Argos is bp’s fifth platform in the Gulf of
Mexico and the first new bp-operated production facility in
the region since 2008. Argos is the centerpiece of bp’s Mad
Dog Phase 2 project, which extends the life of the “super-gi-
ant” oil field discovered in 1998.
The semisubmersible platform ultimately will increase
bp’s gross operated production capacity in the Gulf of Operating in 4,500 feet of water, Argos stands 27 stories tall, and
Mexico by an estimated 20%. The company says that it the platform has a deck the length and width of an American
expects to safely and systematically ramp up production football field, and weighs more than 60,000 tons. COURTESY BP
from Argos through 2023.
Operating in 4,500 feet of water about 190 miles south plans to invest a total of $7 billion into E&P activities in
of New Orleans, bp says that Argos will support 250 per- the Gulf of Mexico by 2025, compared to $10 billion in
manent jobs. Standing 27 stories tall, the platform has a investment over the past five years. The investment figure
deck the length and width of an American football field amounts to an annual average of $2.3 billion in the Gulf of
and weighs more than 60,000 tons. Mexico in the 2023-25 period, up from the $2 billion annual
Argos is bp’s most digitally advanced platform operat- investment seen over the past five years.
ing in the Gulf of Mexico, featuring bp’s proprietary LoSal As laid out in its “US Impact Report: Investing in
Enhanced Oil Recovery and Dynamic Digital Twin tech- America,” the company said that it aims to increase pro-
nologies. Argos has a waterflood injection capacity of more duction in the Gulf of Mexico from about 290,000 boe/day
than 140,000 barrels of low-salinity water per day to help in 2021 to around 400,000 boe/day by the mid-2020s.
increase oil recovery from the Mad Dog field. Several new projects are underway, including a $1.3-bil-
The platform also has a Dynamic Digital Twin, a bp pat- lion expansion at the Atlantis field in the Gulf of Mexico,
ent-pending software that links complex data from Argos to the $9-billion Mad Dog 2 development, and a major expan-
3D digital models of those systems, allowing remote oper- sion at the Thunder Horse field.
ators wearing Virtual Reality headsets to access data in Back in January, bp’s Gulf of Mexico & Canada team
real time to improve decision-making, efficiency and safety. achieved a milestone when the company’s largest platform
Starlee Sykes, who recently served as bp’s senior vice in the GoM, Thunder Horse, hit a production target of more
president, Gulf of Mexico and Canada, said: “Safely start- than 200,000 boe/d for the first time in over a year.
ing up the Argos platform is an incredible milestone for bp In an interview with Offshore in April, Sykes affirmed
and a proud moment for our team who delivered the proj- bp’s ongoing interest in the US Gulf of Mexico. “The Gulf
ect with an impeccable safety record. Producing some of of Mexico is an incredible basin; I’ve heard it called many
bp’s highest value, lowest operational emissions barrels, times a ‘super basin,’” she commented. “And we continue to
our Gulf of Mexico business has an important role to play advance technology that can unlock these reserves. High-
in delivering the energy the world needs.” pressure/high temperature equipment is quickly becoming
Ewan Drummond, senior vice president, projects, produc- industry-proven technology. And bp has done a lot of work
tion and operations, said: “Argos is key to our strategy of on seismic technology to the point where we can, in many
increasing our Gulf of Mexico production to around 400,000 cases, see below the salt layer, and thus have more certain-
barrels of oil equivalent per day by the middle of this decade.” ty about our geologic targets. And all of that continues to
And bp has been affirming its commitment to the Gulf in evolve. So from a geologic perspective, I think the Gulf of
recent months. Earlier this year, the company announced Mexico has massive running room.”
2305_06OFF11_gom.indd 11 5/22/23 8:46 AM

DRILLING RIG REPORT
Top 10 offshore rig

managers expand their
dominance
COVER STORY
China Oilfield Services Ltd

continues to hold onto top spot
Cinnamon Edralin, ESGIAN
T
he global supply of offshore drilling rigs continued to
shrink last year, even as demand picked up across mul-
tiple regions. At the end of 2021, the total supply of drill-
ships, semisubs, and jackups was 723. By the end of 2022, the
total had fallen to 709. Over this same period, the number
of rigs under contract increased to 451 at the end of 2022
from 418 at the end of 2021. A total of 254, or 56%, of the rigs
under contract at the end of the year were managed by the China Oilfield Services Ltd. once again stands atop Offshore’s
ten largest rig contractors in terms of managed fleet size Top Ten Drillers list with a fleet of 58 rigs. The COSL Promoter
for jackups, semisubs and drillships. This is up from 49% rig, shown here, has recently been undertaking a drilling and
of the fleet at the end of 2021. P&A campaign for Equinor offshore Norway. COURTESY COSL
Sales for conversions, recycling decline for drilling purposes in 2022, only five were jackups not
In response to rising demand, rig owners are now less moti- intended for the Middle East market. The four Middle East
vated to sell their rigs outside the industry than they have contractors that purchased jackups last year were ADES,
been for the past several years. Almost all of the rigs sold ADNOC, Arabian Drilling, and Shelf Drilling.
for recycling last year were built before the 1990s. Two One notable purchase transaction involved the merger
notable conversions were confirmed last year. Seadrill between Noble Corp. and Maersk Drilling. The UK’s
sold the semisubs Sevan Brasil and Sevan Driller to New Competition and Markets Authority required the pair to
Fortress Energy for conversion to non-drilling units for its divest some jackups in connection with the merger out of
LNG business. concern for reduced competition in the North Sea. Shelf
Conversely, we saw an increase in rig sales within the Drilling, which prior to this did not have a presence in the
drilling industry. Many of these sales were tied to rig con- North Sea, stepped in and acquired five jackups – Noble
tractors in the Middle East going on a buying spree of pre- Sam Turner (to be renamed Shelf Drilling Winner), Noble
mium jackups from around the world as they sought to Sam Hartley (Shelf Drilling Fortress), Noble Lloyd Noble (Shelf
build their fleets to meet demand. Out of the 41 jackups sold Drilling Barsk), Noble Houston Colbert (Shelf Drilling Odyssey),
2305_06OFF12-14_ten.indd 12 5/22/23 8:46 AM

and Noble Hans Duel (Shelf Drilling Perseverance) – for a com- 46 units at the end of 2021. For clarification, Valaris’s fig-
bined total of $375 million. Shelf then set up an entity called ures do not include units managed by ARO Drilling, which
Shelf Drilling North Sea to manage the rigs. is a 50/50 joint venture with Saudi Aramco. New to the list
Parent company Shelf Drilling also made one other rig this year is Advanced Energy Systems, or ADES, which is
acquisition last year when it purchased jackup Deep Driller based in Egypt. Following a string of rig acquisitions, ADES
7 from Aban Offshore. The rig is now named Shelf Drilling made its debut on the Top 10 list in third place with 45 units
Victory and is scheduled to start its next charter in the under its management.
Middle East in 2Q 2023. The Middle East makes a strong showing in the Top 10
Noble Houston Colbert is the only one of the five units pur- as the headquarters of four of the companies – ADES, Shelf,
chased by Shelf Drilling North Sea that is currently located ADNOC Drilling, and ARO Drilling. For the purposes of this
outside the North Sea region. The rig has been working off article, the Shelf Drilling North Sea fleet is counted under
Qatar since October 2022. Its last job in the North Sea was the parent, Shelf. These combined fleets of these four com-
for work in the UK that ended in April 2020. Furthermore, panies represent approximately 18% of the global fleet and
according to the purchase agreement, the jackup Noble Lloyd 37% of the Top 10 total.
Noble, which is working off Norway, will continue to be The company that dropped out of the Top 10 list was
managed by Noble under a bareboat agreement for the dura- Maersk Drilling, which was acquired by Noble. At the
tion of the charter. end of 2021, Noble had the seventh largest managed fleet,
As mentioned previously, only five of the jackups sold for with Maersk following in ninth place. The combined fleet
drilling purposes last year were not targeted for the Middle now comes in sixth place. In late December 2022, Seadrill
East. Four were the Shelf Drilling units still in the North announced its intention to acquire Aquadrill. Because the
Sea, and the fifth was the purchase of a previously retired transaction was not finalized until April 2023, Seadrill’s
jackup by US-based White Fleet Drilling for use in the US fleet count on the table does not include the Aquadrill fleet.
Gulf of Mexico. This rig has a management agreement with
Enterprise Offshore Drilling. Fewer rigs under construction
At the end of 2022, 45 rigs remained in the under-construc-
COSL maintains top spot on list tion phase, meaning they had not yet been delivered. The
The accompanying table lists the ten largest offshore drill- breakdown by rig type is 14 drillships, 6 semisubs, and 25
ing rig contractors in terms of managed fleet size, meaning jackups. Many of these rigs are far along in the construc-
the figures include rigs that are managed on behalf of other tion process and no recent work has been undertaken, as
owners. China’s state-run China Oilfield Services Limited, some have been considered stranded at shipyards while
or COSL, continues to hold onto the top spot on the list seeking new ownership ahead of final outfitting and formal
with 58 rigs under its management. Second place is also delivery. Last year we started seeing meaningful activity in
unchanged from the end of 2021, with Valaris managing terms of new bareboat arrangements, purchase agreements,
F L E E T B Y R I G S TAT U S FLEET BY REGIONAL SPREAD
OTHER UNDER TOTAL LATIN NORTH SEA/ WEST MIDDLE ASIA-

COMPANY DRILLING STATUSES CONSTRUCTION RIGS US GOM AMERICA BARENTS AFRICA EAST PACIFIC OTHERS
COSL 50 8 0 58 0 2 4 0 5 47 0
Valaris 30 14 2 46 8 5 11 8 5 8 1
ADES 29 16 0 45 0 4 0 0 37 4 0
Transocean 18 21 1 40 9 4 9 2 0 7 9
Shelf Drilling* 28 7 0 35 0 0 3 6 13 12 1
Noble Corp.* 24 9 0 33 3 10 11 4 1 3 1
ADNOC Drilling 27 3 2 32 0 0 0 0 29 3 0
Seadrill 17 4 1 22 2 9 2 4 3 2 0
Borr Drilling 16 3 2 21 0 1 1 5 5 9 0
ARO Drilling 15 0 2 17 0 0 0 0 17 0 0
Top Ten Total 254 85 10 349 22 35 41 29 115 95 12
Entire Fleet 451 213 45 709 44 98 71 46 177 226 47
Top Ten % of Total 56.3% 39.9% 22.2% 49.2% 50.0% 35.7% 57.7% 63.0% 65.0% 42.0% 25.5%
Rig types: Jackups, semisubs, drillships.
Latin America consists of Mexico, Central America/Caribbean, and South America. Asia-Pacific consists of Far East, Southeast Asia, India/Subcontinent, Oceania.
Source: Esgian Rig Analytics. Data as of 31 December 2022.
2305_06OFF12-14_ten.indd 13 5/22/23 8:46 AM

DRILLING RIG REPORT CONTINUED
and purchase options for many of the rigs, leaving fewer count was unchanged at 44, while the Top 10 companies
assets deemed stranded. This activity has carried over into controlled one fewer rig at the end of 2022 with 22 units
2023, shrinking the number of stranded units without a under their management. Even though the supply figure
manager. The Top 10 managers controlled nearly 22% of was unchanged, the region did have movement of rigs in
the undelivered supply at the end of the year. and out over the course of the year.
The last rig delivered in 2022 was Transocean’s
ultra-high-specification drillship Deepwater Titan, which More growth expected in Latin America
has a five-year contract with Chevron for work in the US Latin America has had a lot of attention recently due to
Gulf of Mexico that is scheduled to start in the third quar- Brazil’s Petrobras issuing several multi-rig tenders that
ter of this year. At the time of writing, the rig was in are resulting in reactivations of some cold-stacked float-
transit from Singapore to the US Gulf. This is the world’s ing rigs, and the continued drilling successes in Guyana
first drillship delivered with a blowout preventer (BOP) and Suriname. Mexico, on the other hand, has experienced
equipped for pressures up to 20,000 psi. Deepwater Titan several rig departures, particularly jackups. It has been
is outfitted with two 20K stacks manufactured by NOV. widely noted that there have been issues with contrac-
Meanwhile, sister rig Deepwater Atlas, which was deliv- tors receiving timely payments from state-run oil compa-
ered in mid-2022, was delivered with two 15K psi BOPs. ny Pemex. With growing opportunities around the world
The rig is scheduled for change-out to 20K capabilities and quickly rising dayrates, some rigs have been enticed
later this year. to other regions. Additionally, several jackups from Mexico
were purchased by contractors from the Middle East.
Top 10 make strong Middle East showing Latin America’s offshore rig supply fell to 98, of which 35
Globally, we’ve also seen a decrease in the non-drilling sta- were managed by one of the Top 10 companies, from 108 the
tuses, as a result of demand increasing and more rigs work- previous year, with 34 of those managed by that year’s Top
ing. Breaking this down by region, the Middle East is where 10. Interestingly, for 2022, the Top 10 companies increased
the Top 10 is the most dominant, managing 65% of the fleet, their dominance in the region, representing nearly 36%
up from 45% last year. The big boost is the direct result of versus almost 32% at the end of 2021. Keep an eye on this
so many purchases of rigs by Middle East contractors seek- region for rig count growth over the next couple of years,
ing to build their fleets. as additional capacity is brought in to meet demand.
West Africa has the second biggest showing in the Top Asia-Pacific is another region in which the Top 10 con-
10, although the 63% recorded in 2022 is down quite a bit tractors increased their representation in terms of percent-
from 73% the prior year. While the Top 10 companies had age, but in this case, the total number of rigs they managed
nearly the same number of rigs at the end of 2022 as in fell from 104 to 95. This region experienced a decline in
2021, with 29 and 30, respectively, more rigs have moved supply, dropping from 250 to 226. The primary cause for the
into the region, increasing the supply from 41 to 46, which supply change is due to Asia-Pacific being home to most of
has brought down the percentage. West Africa was the the offshore rig construction yards. Only two of the rigs
final portion of the Golden Triangle (Brazil, US Gulf, West delivered in 2022 remained in the Asia-Pacific region fol-
Africa) to show signs of demand recovery following the lowing delivery.
prolonged downturn. Notably, discoveries in the Orange For 2023, Esgian expects that some of the rigs still in
basin off Namibia have seen some rigs moving into, or shipyards will receive contract awards, and yard work will
making plans to move into, the region. Some of this work resume with an aim to deliver. However, because of global
requires harsh-environment units, which has been a con- supply chain challenges, rigs that have not yet resumed con-
tributing factor in the decreasing offshore rig supply in the struction may not be able to achieve a 2023 delivery date,
Norwegian sector of the North Sea. as lead times for parts and equipment are longer than they
The North Sea’s rig supply fell from 76 to 71, with the were at this time last year. Meanwhile, global rig demand
Top 10 contractors managing 41 units at the end of last is expected to continue to grow, aided by energy securi-
year versus 46 at the end of 2021. The North Sea region ty concerns and by operators moving forward with proj-
has faced a double-whammy of slower-than-anticipated ects made more economical given the strong oil prices the
demand recovery off Norway, and the implementation of market has seen lately. ●
a windfall profits tax in the UK, which has dampened
near-term demand and encouraged rig contractors to look Cinnamon Edralin is Head of Rig Market Research at Esgian. She has
to other regions, such as West Africa and Australia, to more than 15 years of experience researching and analyzing the
find new work. offshore oil and gas drilling rig market. Edralin previously worked for
The US Gulf has achieved a relatively stable supply/ ODS-Petrodata, which was later acquired by IHS Markit. She graduated
demand balance. There was little change to the region’s from the University of St. Thomas in Houston, Texas, with a bachelor’s
fleet from the end of 2021 to the end of 2022. The total fleet degree in liberal arts.
2305_06OFF12-14_ten.indd 14 5/22/23 8:46 AM

DRILLING RIG REPORT
A TALE OF TWO NORTH SEAS:

Norway incentivizes
drilling while UK levy
could lead to rig loss The harsh-environment
semisubmersible Deepsea Yantai
is currently working in the
Norwegian North Sea for OMV
Norge. COURTESY ODFJELL DRILLING/
NORWEGIAN PETROLEUM DIRECTORATE
Global demand for harsh environment

semis may pull rigs from UK North Sea planned. Apache said the cancellation
followed the changes to the EPL.
Bruce Beaubouef, MANAGING EDITOR According to Westwood Global
Energy Group’s Teresa Wilkie, a letter
of intent awarded to a sixth-genera-
T
o paraphrase from Dickens’ classic of the UK North Sea less appealing, tion semi by a UK operator has been
work, the North Sea has become a some drilling contractors are now cancelled after the company over-
tale of two seas: the UK North Sea anticipating moving their rigs out of hauled its UK drilling plans. The rig
and the Norwegian North Sea. The the North Sea and into more reward- could have been contracted until 2030
difference, which is already being ing environments. Harsh environ- if all options had been taken up but
manifested in drilling activity and ment semisubs could be particulalry will now be available on completion
field development plans, comes down impacted, as their owners and manag- of its current UK drilling campaign
largely to extremely contrasting fiscal ers look to deploy these high-demand in mid-2024.
regimes and regulatory policies. rigs for drilling campaigns off South The International Association
In the UK North Sea, drilling activ- Africa or offshore Australia. of Drilling Contractors’ North Sea
ity has been hampered by the Energy For exa mple, Odf jell Drilling Chapter recently sent a letter to all 650
Profits Levy (EPL) enacted last spring, recently announced that its semisub- UK MPs and 129 MSPs warning that
a fee that was subsequently increased mersible Deepsea Mira will leave the further harsh-environment rigs could
by an additional 10% late last year, North Sea for a 300-day contract be “lost for good” to the UK due to the
bringing the headline tax rate for with TotalEnergies in Namibia in 2Q windfall tax changes.
UK oil and gas producers to 75%. 2023. Other rigs are departing the The North Sea rig supply is now
The increased fees have led some UK UK North Sea too. The only drillship 40% below what it was in March 2017,
North Sea operators to slow their drill- in the region, Deep Value Driller, has Westwood’s RigLogix has calculated,
ing campaigns, and put the brakes on been bareboat chartered by Saipem with 13 rigs departing the region in the
field development projects that could and will move to Cote D’Ivoire to past two years either for work else-
have seen FID this year. drill for Eni this year. Apache recent- where or retirement. Two more – the
Already this year, the UK North Sea, ly announced an early contract ter- semis Hercules and the aforementioned
which has been fairly active in recent mination for Diamond Offshore’s Deepsea Mira – will relocate later this
years, has seen a decline in floating Ocean Patriot. The semisubmersible year to eastern Canada and Namibia.
drilling rig activity. With the global rig rig should now become available in A Westwood Insight published
market tightening, and the economics July, more than 400 days earlier than last November found that despite
2305_06OFF15-17_drill.indd 15 5/22/23 8:46 AM

improving North Sea rig conditions, harsh-environment rigs operating due TotalEnergies, Equinor, Shell and
assignments elsewhere commanded to weaker North Sea demand related EnQuest have announced plans to
longer durations and higher day rates. to the fiscal changes. reduce their UK offshore expendi-
RigLogix counts four cold-stacked And once rigs exit the region, they ture this year, and FID for planned
rigs at present in the North Sea at may not return, said Wilkie, due to greenfield projects, such as Ithaca
large, comprising three semis and a combination of high mobilization Energy’s West of Shetland Cambo
one jackup, and nine warm-stacked costs and more attractive contract oil development, may also be at risk
rigs (five semis and four jackups). Only terms and day rates in the Golden due to the EPL.
three of the latter have work lined up, Triangle region, the Middle East, Meanwhile, drilling activity off-
in two cases outside of the region. And and Australasia. This would lead to a shore Norway is picking up. Earlier
15 further rigs could come off contract smaller pool of rigs within the North this year, the harsh-environment semi
before the end of this year if follow-on Sea region, with less choice and higher Deepsea Yantai, operated by Odfjell
work is not secured or options not day rates for operators planning fresh Drilling, spud the Eirik exploration
declared. A high-spec, harsh-environ- campaigns in the years ahead. well in the Norwegian North Sea for
ment semi currently in the North Sea In addition, several field devel- operator OMV Norge. The 15/2-2 S well
could relocate later this year to drill in opment projects planned for the UK is drilling in production license 817,
the eastern Mediterranean. North Sea could be jeopardized by the close to the Equinor-operated Gudrun
As for jackups, Valaris reportedly EPL. Wilkie said that the UK North field in 111 m water depth. Operations
plans to preservation-stack the Valaris Sea outlook could worsen consid- could last up to 100 days in the event
Viking as a cost-reducing measure as erably if offshore operators decide of a discovery, which would include
it does not foresee sufficient work their projects are no longer feasi- a sidetrack. Eirik is a gas and con-
in the region to keep all three of its ble in the current financial climate. densate prospect close to existing
Departing the UK North Sea: the

semisubmersible rig Hercules will
relocate to eastern Canada in 2Q
2023. PHOTO BY OLE JØRGEN BRATLAND,
COURTESY EQUINOR
2305_06OFF15-17_drill.indd 16 5/22/23 8:46 AM

infrastructure, said OMV Norge gen-
eral manager Knut Mauseth.
In March, Equinor awarded con-
tracts for the use of the Transocean
Encourage, mainly in the Norwegian
Sea; and Transocean Enabler, for the
Johan Castberg field, in the Barents
Sea. The two companies also signed a
strategic collaboration agreement. The
rigs have been on eight-year contracts
with Equinor – one that expired last
December and one that will expire in
April 2024, respectively. This will be
the first contract extensions for these
rigs since they were built, as so-called
Cat D rigs, specialized for Norwegian
conditions. The drilling program in the
Norwegian Sea consists of nine wells
to be drilled on the Tyrihans, Verdande,
Andvare and Vigdis fields located in
the Tampen area of the North Sea. Departing the UK North Sea: the semisubmersible Deepsea Mira is scheduled for work
Verdande and Andvare will be tied offshore Namibia starting in 2Q 2023. COURTESY ODFJELL DRILLING
in to the Norne field. The drilling pro- present value and lowers the breakeven It should be noted that the main
gram also includes exploration wells prices of development projects. suppliers of gas will continue to be
and may be further extended, adding Operators on the Nor weg ia n major fields sanctioned during the
six wells. The estimated total value Continental Shelf strove to submit standard tax regime, such as Johan
of the nine wells is about $191 mil- their plans of development and oper- Sverdrup in the North Sea.
lion. The Transocean Encourage and ation before the new standard regime Rystad estimates the additional
the Transocean Enabler are sixth-gen- took effect at the start of this year. Of supply of gas in 2028 at about 24.9 Bcm,
eration fully winterized, harsh-envi- the 35 projects sanctioned within the close to 6.225% of demand in the EU
ronment semisubmersible rigs with temporary regime, 24 were sanctioned and the UK combined, with Norway
automated drilling control special- in 2022, a record for Norway in a single accounting for almost one-third of
ly designed for operations on the calendar year, with the total value of European gas supplies in five years.
Norwegian Continental Shelf. these projects likely to approach $29 And those projects sanctioned
Development spending offshore billion. Greenfield spending from the u nder Nor way ’s tempora r y t a x
Norway, buoyed by an ostensibly 35 projects should climb steadily over regime should help sustain high gas
temporary tax regime, is expected to the next three years, to $9.1 billion in production on the NCS through 2030.
increase significantly following the 2024, $7.4 billion in 2025 and to $6.3 Rystad Energy estimates that produc-
submission of plans for multiple proj- billion in 2026. The combined resourc- tion from the tax window projects
ects late last year. According to Rystad es are estimated at 2.472 Bboe. should peak at 921,000 boe/d in 2028.
Energy, the overall capex of greenfield Some of the key upcoming field Thereafter, based on current plans,
investments proposed in 2022 will be development projects in the Norwegian production could slip to 818,000 boe/d
$42.7 billion. The Norwegian govern- North Sea include Aker BP’s North Sea in 2029, 659,000 boe/d in 2030, then
ment implemented its temporary tax Yggdrasil Hub (startup in 2027), Shell’s evening out at 254,000 boe/d in 2035.
regime during the 2020 market down- Phase 3 of Ormen Lange (startup in The firm’s upstream analyst Mathias
turn to secure future development 2025) and Equinor’s Irpa (startup in Schioldborg said: “The outcome of
spending. The measures incentivized 2026). These projects are expected to this tax break is threefold: increased
operators by boosting the uplift rate provide a significant boost to Norway’s investment on the NCS, increased tax
on all ongoing investments in 2020 gas supply. And NCS liquids produc- receipts when production starts and
and 2021, and on new projects sanc- tion should also be steady going for- increased supply to Europe at a crit-
tioned before 2023 up until first oil ward, helped by the Yggdrasil Hub, ical time. Norway will need to con-
flows. Despite a reduction in the uplift Equinor’s Breidablikk (start-up in sider if this regime is a one-off to
rate last year from 2020’s 24% to 12.4%, 2025), and Vår Energi’s Balder Future attract investment or if lessons can
the temporary regime still lifts the net (start-up in 2024). be learned for the future.” ●
2305_06OFF15-17_drill.indd 17 5/22/23 2:54 PM

GEOSCIENCES
Seismic survey market

finally recovering
Analysts says seismic market
upturn is in full swing
Ariana Hurtado,
EDITOR AND DIRECTOR OF SPECIAL REPORTS
T
he future is looking bright for seis-
mic service providers this year.
Recent a na lysis by Esg ia n
revealed that seismic campaigns and
capex budgets are all up, with major
seismic player highlights that include:
• CGG: fourth-quarter 2022 delivered
higher-than-anticipated multicli-
ent data and equipment sales;
• PGS: 2022 multiclient late sales
second highest on record; and
• TGS: highest fourth-quarter 2022 Petrobras has contracted a consortium of Alcatel Submarine Networks and Maersk
late sales since 2014. Supply Service to construct and install a permanent seismic monitoring system offshore
Offshore recently chatted with ana- Rio de Janeiro. COURTESY MAERSK SUPPLY SERVICE
lysts from Rystad Energy and S&P
Global about the recovering seismic share of exploration capital expendi- 35% year-on-year and has since said
survey market to gauge their thoughts ture, while 20% of the year’s total is it expects this to continue, though it is
on the current trends and outlook for set to go on frontier basins, a hike of unlikely to replicate the rate increase
the remainder of the year. more than 50% from 2022.” experienced between 2021 and 2022,
“With increased exploration activ- Track ing the ma r ine seismic according to Sinclair.
ity, demand for seismic services is market and its vessels, Beth Sinclair, “The uptick in multiclient late sales
expected to grow by an additional an analyst with Petrodata SeismicBase and the success in obtaining full pre-
14%, or $1.1 billion, and total almost by S&P Global, added, “The consensus funding for multiclient sweeps off
$9.3 billion in 2023,” said Binny Bagga, within the industry is that 2023 and Brazil, West Africa and Southeast Asia
vice president of supply chain analy- beyond will see the seismic market demonstrate the current appetite for
sis with Rystad Energy. “Key offshore go from strength to strength as the exploration once again, and seismic
regions such as the Gulf of Mexico upturn is deemed to be finally in companies will be happy to be bolster-
[GoM] and the North Sea are expect- full swing. There is real optimism. ing their coffers. Especially the vessel
ed to remain core to the seismic Continued energy security concerns owners,” she said. “The streamers in
market, with strong growth expect- and improved profits have seen oil the global fleet are generally getting
ed in Norway. The surge in oil and and gas companies increase their E&P quite old, and to replace a full spread
gas prices in the past year following spending, which in turn has seen the costs approximately $50 million, as
Russia’s invasion of Ukraine has led revenues of seismic firms rise.” quoted by PGS.”
to an increased appetite for offshore Meanwhile, companies are reacti-
exploration spending among majors Vessel updates vating vessels, such as Shearwater’s
and national oil companies alike. In the final quarter of 2022, PGS report- SW Mikkelsen and SW Gallian last
Mature basins are set to take the lion’s ed that vessel day rates had risen by year and PGS’ Ramform Victory this
2305_06OFF18-21_seis.indd 18 5/22/23 8:46 AM

year, which “exemplifies the confi- Magseis Fairfield is mobilizing a project, it will be one of the largest of
dence companies have in the market crew to work in Norwegian and UK its kind in Asia to date, Bragga added.
going forward,” Sinclair added. “It is a waters in the coming months, and Other major seismic contrac-
pricy business to take vessels out of SAExploration has been contracted by tors such as Shearwater have also
cold stack.” TGS to gather multiclient data around announced several contract awards
Carbon Transition’s Utsira survey in recent months, including two con-
Collaborations, M&A off Norway.” tracts awarded to Shearwater by
“The marketplace is certainly chang- Petrobras for 4D seismic surveys at the
ing, however, with collaboration and Market outlook Jubarte and Tartatuga Verde fields in
amalgamation an ongoing trend,” “The strong market outlook for 2023 the Campos Basin off Brazil.
Sinclair explained. “Companies strike is good news for the seismic compa- Equinor and partner YPF gained
vessel time agreements (e.g., CGG with nies after the promising developments environmental approvals in April to
Shearwater GeoServices; WesternGeco we have seen last year,” Bagga said. acquire 3D seismic across three blocks
with Shearwater GeoServices; TGS “Preliminary revenue reports from offshore Argentina, with Shell and
with COSL) while acquisitions shrink both TGS and PGS for the first quarter TotalEnergies, along with partners bp
the market. TGS’ most recent acquisi- of this year as well as numerous recent and Qatar Energy, also set to acquire
tion of Magseis Fairfield has placed it contract awards point to continued 3D seismic on their Argentinian acre-
at the forefront of the OBN [ocean-bot- growing demand for seismic services. age during 2023/2024.
tom node] sector. Meanwhile, SeaBird Multiple contracts that will support That same month, PGS released
is calling for more mergers, believing the suppliers’ growth this year have the first data from its new Pacific
that its source/2D vessels would be the been awarded in the past few months.” MegaProject covering prospective
perfect addition to an OBN company.” The following sampling summariz- areas across much of Colombia’s off-
Sinclair said OBN is on the “up and es some of the latest contract awards shore Tumaco and San Juan basins.
up” and that crews are booked through- around the world. The company has reprocessed all
out 2023 and onward. For example, available data in the target area to
PXGEO’s OBN crew has work offshore South America produce a single unified and rejuve-
Brazil until August 2024. A crew for- In April TGS announced the com- nated MegaProject dataset. This is said
merly operated by Magseis Fairfield mencement of the second stage of a to provide new insights into potential
(now TGS) has work in Guyana until Peninsular Malaysia multiclient 3D petroleum system elements and possi-
the end of the year, while a second reprocessing project covering 20,347 ble hydrocarbon-bearing traps.
TGS crew has contracts in the US GoM sq km from 32 3D seismic studies Back in March, a consortium of
stretching beyond that. in collaboration with DownUnder CGG, TGS and BGP completed Phase IV
In addition, TGS signed a collabo- GeoSolutions (DUG). Combined with of their deepwater 3D seismic survey
ration agreement with SLB in March, the 16,957-sq-km first stage of the offshore Suriname. The 1,800 sq km
under which the two companies will
gain access to each other’s US GoM
data for sparse OBN acquisition and
processing. The combined database,
covering all prospective areas of the
US GoM, will allow the companies to
jointly pursue multi-year acquisition
campaigns over producing and explo-
ration acreage.
“Shearwater GeoServices (with its
newly activated source vessels men-
tioned earlier) will also remain in
the US Gulf of Mexico for the fore-
seeable future, while SW Tasman is
being converted into the industry’s
first dual ROV, source and stream-
er multi-purpose vessel,” Sinclair
said. “Meanwhile, SW Vespucci has
Norwegian OBN work to keep it busy Shearwater’s SW Empress vessel will conduct a two-month 4D monitoring survey
throughout the summer season, TGS/ offshore Cote d’Ivoire. COURTESY SHEARWATER GEOSERVICES
2305_06OFF18-21_seis.indd 19 5/22/23 8:46 AM

GEOSCIENCES CONTINUED
covered was the final part of a pro- inter-field pipeline locations in the UK Africa
gram to acquire a 14,500-sq-km survey southern North Sea. The 77-m-long Shearwater’s SW Empress vessel will
of new 3D data in deep and shallow DP2 vessel is equipped with cone conduct a two-month 4D monitoring
water in the Guyana-Suriname Basin, penetration testing and vibrocor- survey offshore Côte d’Ivoire. The pro-
with more than 6,400 sq km of existing equipment. gram, due to start in May, will be in
ing data reprocessed. Additionally, in February PGS com- direct continuation of the vessel’s cur-
The Petrobras-led Sépia consor- pleted 2D seismic surveys over the rent activity in the region.
tium contracted PXGEO in March west and southwest areas offshore In addition, a 3D survey over PEL
to acquire a 3D OBN survey in the Crete, Greece, for licensees Exxon 87 and the surrounding area in the
Santos Basin offshore Brazil. The pro- Mobil and Helleniq Energy. Hellenic Orange Basin offshore Namibia had
gram, in water depths of up to 2,300 Hydrocarbons and Energy Resources reached progress of being more than
m, will take about four months to Management Co. (HEREM A), the 50% complete as of late April, accord-
complete. It will be PXGEO’s fourth authority that manages the concession ing to Sintana Energy. The survey
acquisition project for Petrobras rights on behalf of the Greek State, said will cover a total area of 6,872 sq
since mid-2021. a total of 12,278 line km were collect- km. Initial processed results should
Petrobras contracted a consortium ed, far above the minimum contractu- be available by the end of August.
of Alcatel Submarine Networks and al obligation of 6,500 km for the two Woodside Energy reportedly cov-
Maersk Supply Service in February blocks combined. ered the costs of the $35 million 3D
to construct and install a permanent Late last year, CGG formed an seismic survey over an area of at least
seismic monitoring system (PSMS) in agreement with Carbon Transition 5,000 sq km.
the Mero Field in the presalt Santos subsidiary Axxis Multi Client to repro-
Basin, 180 km offshore Rio de Janeiro. cess the Utsira OBN seismic survey in Asia-Pacific
The project will deploy 4D seismic the Norwegian North Sea. The 2,000- Korea National Oil Corp. has com-
mon itor ing tech nolog y to track sq-km Utsira survey, which is due to missioned Shearwater to acquire a
reservoir behavior over time. Data be completed in 2024, is claimed to 3D streamer survey offshore South
acquired should broaden k nowl- be the largest ultra-high-resolution Korea. The 1,200-sq-km survey will
edge of distribution of fluids in the OBN survey in the North Sea. For the be the company’s third project for the
reservoir and support more efficient reprocessing, CGG will employ OBN state-owned oil and gas corporation.
oil production from the Mero Field, processing and imaging technol- At the beginning of the year, TGS,
Petrobras said. The PSMS will be ogy including time-lag full-wave- SLB and Petrobangla conducted a new
installed next year. form inversion. multiphase 2D seismic program off-
shore Bangladesh. The initial phase
Europe Gulf of Mexico involved acquiring a minimum of
In April GEOxyz’s Geo Ocean III vessel In February TGS and SLB started about 11,000 line km of HR broadband
started a geophysical survey for acquisition of the Engagement III seismic data, designed to improve
Hartshead Resources over the Anning ultra-long offset OBN survey in the understanding of the prospective
and Somerville gas fields and planned Green Canyon region in the US GoM. Bengal Fan. According to TGS CEO
The 111 OCS Block survey was expect- Kristian Johansen, this is one of the
ed to be completed in April and deliver world’s most-extensive remaining
imaging uplifts through full-wave- unexplored frontier basin.
form inversion velocity model build-
ing, using ultra-long offsets. SLB will The energy transition
perform imaging with final results “The ongoing energy transition is
expected in mid-2024. Engagement III, expected to create alternative reve-
the fifth multiclient ultra-long offset nues streams for seismic players that
OBN acquisition exercise in the GoM, have diversified their businesses by
will extend the data coverage south venturing into the carbon storage,
from prior phases. geothermal, offshore wind and deep-
That same month, TGS inked a sea mining sectors,” Bagga said.
letter of agreement to shoot a propri- For example, Fugro plans to per-
PGS’ Ramform Hyperion vessel recently etary 4D OBN survey over the Walker form offshore geotechnical site inves-
completed a 3D seismic acquisition
contract for exploration purposes in the Ridge canyon in the US GoM. The com- tigations for the Star of the South wind
Mediterranean Sea, awarded by an pany expects to mobilize for the 100- development off the Gippsland coast in
unnamed energy company. COURTESY PGS day campaign this summer. southeast Australia.
2305_06OFF18-21_seis.indd 20 5/22/23 8:46 AM

As another example, TerraSond
and Benthic, both in Acteon’s Data
and Robotics division, will perform
geophysical and geotechnical survey
work for two planned floating wind
farms northeast of Aberdeen. The
Ocean Fortune vessel, under long-term
charter to TerraSond, will acquire the
geophysical survey with support from
Acteon in Aberdeenshire and UTEC’s
data center in Livingston.
Additionally, Thistle Wind Partners
recently initiated seabed surveys for
its two ScotWind projects: the 1-GW
Ayre floating offshore wind farm off-
shore Scotland and the 1-GW Bowdun
fixed foundation wind farm offshore
Aberdeenshire in the North Sea. G-tec
is leading the first phase, geophysi-
cal surveys of the seabed at both sites
in leasing zones NE2 and E3, which
are due to continue through October.
The survey vessel will cover an area
of almost 400 sq km. G-tec special- “Our scheduling team were able to view
ists will process the data, apply-
ing the results to ground modeling
the impact of changes in real-time which
studies from October onward, with led to a direct impact on the bottom line.
metocean surveys starting around
the same time.
We saved $10 million on one well alone, by
“The current climate is the per- rapidly generating scenarios showing the
fect storm for seismic firms,” Sinclair
concluded. “The continued need for impact of diﬀerent well sequences.”
traditional oil and gas exploration,
paired w ith the ongoing energ y
transition process, puts the seismic
industry in an enviable position.
Frontier exploration is once again
in favor, while the need for spe- That's what a customer Program Manager
cialized seismic over potential CCS stated after they implemented Actenum DSO.
and wind farm sites means seismic
companies can be at the forefront of
new exploration and data processing With DSO, you can achieve results like this too.
innovation.” It's AI-powered software that integrates and
She listed the 1,600-sq-km survey
conducted by PGS’ Ramform Hyperion optimizes your oﬀshore operations schedules,
in June last year as an example. It and enables your team members to share, view
covered the Northern Endurance
Partnership CCS area in the UK North
and report on the same data.
Sea, which she said was the first and
largest of its kind. “Repeat 4D work Request a demo now!
will be required over the site in 2027,
and every five years thereafter, pro-
viding prolonged and predictable seis-
mic demand,” she said. ●
MAY/JUNE 2023 | www.offshore-mag.com info@actenum.com actenum.com
2305_06OFF18-21_seis.indd 21 2306OFF_Actenum.indd 1 5/22/23 8:46 AM

5/3/23 10:54 AM
DECOMMISIONING
Production data
for public companies reporting decom-
missioning liability are included
within a broader category called pro-
underpins successful
visions with (slightly) different rules
and requirements than AROs, but gen-
erally speaking the two liability clas-
worldwide ARO
sifications are quite similar.
Reporting requirements
For public companies that are orga-
analysis
nized under the laws of the United
States or are listed on US exchanges,
US Generally Accepted Accounting
Principles (GAAP) are required, also
referred to as the Financial Accounting
Planners should understand relationship between Reporting Standards (FASB). In other
asset retirement obligations, production rates countries, International Financial
Reporting Standards (IFRS) as issued
by the International Accounting
Mark J. Kaiser, LOUISIANA STATE UNIVERSITY Standards Board (IASB) are employed.
Both standards require decom-
P
ublic oil and gas companies are site to its original condition. These are missioning liabilities to be recorded
required to report the present value called asset retirement obligations at the present value of the expendi-
of their decommissioning liability, and public oil and gas companies are tures expected to be required to settle
referred to as asset retirement obliga- required to disclose the present value the obligation. The amount should
tions (AROs) and provisions, for all oil 2306OFFkais
of their AROs annually in theirfigures
finan- reflect the best estimate that a com-
and gas assets worldwide where there cial reporting. pany would pay to settle the obli-
is a legal obligation to perform. Outside the US, legal requirements gation at the balance sheet date or
One well-known feature of the oil for decommissioning 10000 vary widely to transfer it to a third party at that
and gas industry is the strong cor- depending on the country’s regulato- time. These standards are similar but
relation that exists between produc- ry regime and the contract terms that y = 0.0884x
not identical, with differences in ter-
tion and reserves. In the first part of 2306OFFkais figuresand production. R² =minology,
0.8994
Production (MMboe)
govern exploration reporting requirementsyand = 0.0215x

this two-part series, we show that a 1000
International accounting standards measurement. R² = 0.7809
similar relationship arises between
AROs and production, a much less 10000
obvious result but one with import-
ant implications. y =100
0.0884x
R² = 0.8994
Production (MMboe)
We begin with the regulatory defi- y = 0.0215x

nitions of AROs and provisions and 1000 R² = 0.7809
how AROs are estimated at the cor- 10
porate level. 1,000 10,000 100,000 1,000,000
100 Reserves (MMboe)
Asset retirement obligations
Whenever a well is drilled, equipment Integrated Integrated-
installed, or a pipeline placed in ser-
vice for oil and gas production, there 10
1,000
Figure 1. Production
10,000
vs. proved100,000
reserves for integrated companies and
1,000,000
is a legal obligation in the US for the
Aramco and the four Russian majors (“Integrated-”), year ending Dec. 31
operator to abandon the well when no Reserves (MMboe)
longer producing or useful for service, Figure 1. Production vs. proved reserves for integrated companies and those that
remove the equipment, decommission exclude Saudi Aramco and the four Integrated Integrated-
Russian majors (“Integrated-”), year ending
or remove the pipeline, and restore the December 31, 2021. 10000
y = 0.0884x
22 OFFSHORE
Figure 1. Production vs. proved reserves for integrated companies and
R² = 0.8994
www.offshore-mag.com | MAY/JUNE 2023
those that exclu
Aramco and the four Russian majors (“Integrated-”), year ending Dec. 31, 2021.
n (MMboe)
1000
2305_06OFF22-25kais.indd 22 5/22/23 8:46 AM

100
2306OFFkais figures
Asset retirement obligations associ- cases where an asset has been sold but profitable and reduce the discounted
ated with the retirement and decommis- the subsequent owner is no longer able cost of future decommissioning (com-
sioning of tangible long-lived assets are to fulfill its decommissioning obliga- pared to P1 reserves calculations).
10000 required to be recognized under FASB tions, for example due to bankruptcy.
guidelines asy =a 0.0884x
liability in the period in Let’s look at how AROs are estimated. Discount and inflation rates
which a legalR²obligation
= 0.8994 is incurred and Assumptions on discount rate and
Production (MMboe)
becomes determinable, with an offset- y = 0.0215x

Decommissioning cost inflation rate in ARO calculations are
1000 R² = 0.7809
ting increase in the carrying amount Decommissioning costs are estimat- company specific, whereas in the stan-
of the associated asset. The cost of the ed at a field (or project) basis by engi- dardized measure of proved reserves
tangible asset, including the initial rec- neers and project managers using calculations, discount rates are fixed
100 ognized ARO, is depleted such that the historical data, internal estimates and at 10%. The discount rates applied in
cost of the ARO is recognized over the market information. Typically, plug and ARO calculations consider the risk-
useful life of the asset. The fair value of abandonment well cost and structure free rate by term and currency, coun-
2306OFFkais
10
figures
the ARO is measured using expected removal cost are based on estimated try risk and a spread according to the
cash outflows associated with the ARO, duration and estimated rig spread rates, debt structure and cash flow proj-
1,000 10,000 100,000 1,000,000
discounted at a credit-adjusted risk-free lift boat rates (if offshore), and planned ect period. Companies that apply low
rate10000 Reserves
when the liability is initially (MMboe)abandonment logistics. Rig rates may
record- discount and inflation rates (1-3%/yr)
ed. Accretion expense is recognized over be based on a rolling three (or five) year are essentially valuing future decom-
time as the discounted Integrated
yliability
= 0.0884x Integrated-average observed in the marketplace for
is accret- missioning cost under current undis-
R² = 0.8994
Production (MMboe)
ed to its expected settlement value. similar types of rigs. Estimated dura- counted conditions, and this appears
y = 0.0215x
Figure 1. Production
1000 anvs.
Where provedexists
obligation reserves
for a newfor integrated companies
tion is normally based and
on
R² = 0.7809 those
historic that
jobs exclude Saudi assumption among
to be a common
Aramco and the four
facility Russian
or item of plant, majors
such as(“Integrated-”),
oil and adjusted year
for ending Dec.conditions.
site-specific 31, 2021. companies, while high discount and
natural gas production or transporta- inflation rates (4-8%/yr) assume sig-
tion facilities, this liability is recog- Timing nificantly lower present value to these
100
nized on construction or installation. The cessation of production is esti- costs. Companies do not have to report
10000
Similarly, where an obligation exists for mated by
y = 0.0884x decline curve methods and the discount/inflation rates applied,
a well, the liability is recognized when assumptions
R² = 0.8994 on commodity prices, but rates are sometimes disclosed.
1000 it is drilled. An obligation for decom- operating cost and economic limits,
Production (MMboe)
10
missioning may also crystalize
1,000 during
10,000 similar to the standardized 1,000,000
100,000 measure Commodity prices
the period of operation of a well, facil- of proved
Reserves (MMboe) reserves (STM) calculations. Commodity price assumptions impact
100 ity or item of plant through a change Companies that follow FASB guide- ARO cost directly and indirectly through
y = 0.0875x
in legislation or ythrough
= 0.086x a decision to
Integrated
lines apply
Integrated-
proved reserves P1 in their their impact on market cost assump-
R² = 0.9253 R² = 0.9043
terminate operations (e.g., additional timing assessment, while companies tions and timing effects. In STM compu-
10
or lesser work may be required when following IASB guidelines may apply 2P tations, commodity prices are assumed
Figure
wells1.or Production
infrastructure vs.are proved
preservedreserves for integrated
reserves (proved plus companies and those
probable), which thethat exclude
average of the Saudi
last reporting period,
Aramco
or and the
decommissioned four to Russian
a differentmajors
stan- (“Integrated-”),
will normally year
add ending
several Dec.
years to 31,
the 2021.
but in ARO estimation there are no spe-
1
dard);
1 an obligation
10 may also
100 arise in 1000time when 10000production is
100000 no longer cific requirements on what commodi-
Reserves (MMboe) ty prices should be applied. One would
10000 think similar price assumptions would
y = 0.0884x be applied in both ARO and STM calcu-
Onshore Integrated- Offshore R² = 0.8994 lations, but this is not required.
Production (MMboe)
1000
Figure 2. Production vs. proved reserves for independent onshore, independent offshore, and
Categorization
integrated companies excluding Saudi Aramco and the Russian majors (“Integrated-”),P year ending
ubl ic compa n ies a nd gover n-
Dec. 31, 2021. 100 y = 0.0875x ment-sponsored enterprises (GSEs)
y = 0.086x
R² = 0.9253 R² = 0.9043 are organized into integrated and
10 independent company groups, and
two subcategories for independents
are applied, primarily offshore and
1 primarily onshore independents.
1 10 100 1000 10000 100000 Primarily onshore/offshore compa-
Reserves (MMboe) nies have more than half of their pro-
1
Figure 2. Production vs. proved reserves for independent onshore, independent duction onshore/offshore.
Onshore excluding
offshore, and integrated companies Integrated- Offshore
Saudi Aramco and the Russian majors Most national oil companies (NOCs)
(“Integrated-”), year ending December 31, 2021. do not report ARO, STM or well data,
Figure 2. Production vs. proved reserves for independent onshore, independent offshore, and
integrated companies excluding Saudi Aramco and the Russian majors (“Integrated-”), year ending
Dec. 31, 2021.
2305_06OFF22-25kais.indd 23 5/22/23 8:46 AM
DECOMMISIONING CONTINUED
but we include a few NOCs in our sample (e.g., Saudi Aramco, many small companies (5-50 MMboe) such as Callon, DNO,
and the four major Russian majors Gazprom, Lukoil, Novatek, Kosmos Energy, Spirit Energy, and Tullow Oil.
and Rosneft) even though they are of a different character Most onshore companies sampled produce exclusively
than public companies and GSEs, especially in terms of geo- onshore, but five companies also had offshore production
political drivers and the manner of decision making. (ConocoPhillips, DNO, Hess, Marathon Oil, Occidental) rang-
Saudi Aramco and the four Russian companies are all ing between 15-40% total production.
integrated oil and gas companies, but having only a small
percentage of their production offshore (or in the case of Production vs. reserves
1000
Saudi Aramco, low-cost shallow water production), these Reserves are the storehouse of production, and since pro-
companies are more like independent onshore producers in duction operations are subject to the same engineering
y = 0.1387x
STM ($billion)
terms of their ARO requirements since AROs

100 do not include requirements
R² = 0.9845 in field development, similar business con-
downstream or midstream assets. Russian companies pro- straints (at least for public and private companies, and to a
y = 0.0967x
duce offshore in the Arctic, Far East and their Southern Seas large extent GSEs) and market conditions,
R² = 0.9154 it is not surpris-
10 1000 produc- 1000
(Azov, Black, Caspian), but as a percentage of total ing that production and reserves correlate across similar
y = 0.092x
tion, offshore regions contributes 5% or less per company industry groups. y = 0.1387x
R² =y0.9209
= 0.1387x
STM ($billion)
100 year-out, the basic oil and
STM ($billion)
(10% for Lukoil), and thus, these companies1 can100be catego- Year-in R² =gas
0.9845
business models in
R² = 0.9845
rized as primarily onshore producers. 10 capital
100 markets hold fast and true, and this is observed
1000 for they = 0.0967x
y = 0.0967x10000
Two integrated producer groups are identified: production-reserves
Production
10 relationships
(MMboe) shown in Figure
R² = 0.9154 1 for inte-R² = 0.9154
“Integrated” and “Integrated-” where the minus sign10 signi- grated companies, and in Figure 2 for offshore independents
y = 0.092x
fies the exclusion of Saudi Aramco and the four major Russian and onshore producers. y =With
0.092xproduction andR² = reserves varying
0.9209
Integrated- Onshore R² Offshore
= 0.9209
companies from the sample. Independent onshore companies more than1 three orders-of-magnitude, log-log plots are used.
1 10 100 barrels of oil equivalent1000
are denoted “Onshore”, and the “Onshore+” group signifies
10
For integrated companies, 0.022
100 companies excluding 1000 10000
Figure 3. STM vs production
the addition of Saudi Aramco, Gazprom, Lukoil, Novatek, and were produced in 2021 for every boe reserves in the ground. and the Russi
for integrated Production Saudi Aramco
(MMboe)
majors (“Integrated-”), and primarily onshore Production (MMboe) offshore independents, year endin
and primarily
Rosneft to the sample.
1000
Dec. 31, 2021. Integrated- Onshore Offshore
Integrated sample group Integrated- Onshore Offshore
y = 0.1387x
STM ($billion)
The integrated sample group includes 100 Figure 3. STM R² =vs production for integrated companies excluding Saudi
0.9845
19 integrated companies along with Figure 3. STM vs production for integrated
majors (“Integrated-”), andcompanies
primarily excluding
y = 0.0967x
onshore andSaudi Aramco
primarily and thin
offshore
several NOCs. Equinor and Petrobras majors 10 R² = 0.9154
(“Integrated-”), and primarily
Dec. 31, 2021. onshore and primarily offshore independents, ye
are almost exclusively offshore oper- Dec. 31, 2021. y = 0.092x
ators (>90% production derives from R² = 0.9209
offshore fields), whereas about two- 1
100000 10 100 1000 10000
thirds of Pemex and ONGC production
comes from offshore operations. All Production (MMboe)
y = 20.42xfor integrated companies excluding Saudi Aramco and the
Figure 3. STM vs production
other companies, except Saudi Aramco10000
and the four Russian companies, have Russian majors (“Integrated-”),
R² = 0.8573 and primarily
Integrated- onshoreOffshore
Onshore y = 12.821x
and primarily offshore
ARO ($million)
independents, year ending December

100000 31, 2021. R² = 0.9015
offshore production contributing 1000
between 20-60% total production. Figure 100000
3. STM vs production for integrated companies excluding Saudi Aramco and the Ru
majors
100 (“Integrated-”), and primarily onshoreR²and
10000 primarily offshore independents, year en
y = 20.42x
= 0.8573 y = 12.821x
Primarily onshore and Dec. 31,10000
2021. y = 20.42x
ARO ($million)
R² = 0.9015
offshore producers R²1000
= 0.8573 y = 6.3969x y = 12.821x
10
ARO ($million)
Twenty-three companies with at least R² = 0.6918 R² = 0.9015

1000
half of their production from offshore 100
were identified as primarily offshore 1
producers, and twenty-one compa- 1 100 10 100 1000 10000 y = 6.3969x
10
Production (MMboe) R² = 0.6918
nies comprised the primarily onshore
y = 6.3969x
producer group. 10
1 R² = 0.6918
The independents sampled contain 100000 Integrated- Offshore Onshore
1 10 100 1000 10000
a few large producers (>400 MMboe) 1 Production (MMboe)
10000 1 y = 20.42x
10 100 1000 Saudi Aramco 10000 and the Russi
such as ConocoPhillips, CNOOC,Figure
one 4. ARO vs. production for integrated
R² = 0.8573
companies excluding y = 12.821x
of China’s GSEs, and Occidental, many
majors, primarily offshore independents and primarily
Production onshoreOffshore
(MMboe)
Integrated- independents,
Onshoreyear ending Dec. 3
ARO ($million)
R² = 0.9015
moderate-sized companies (50-400 1000
2021. Figure 4. ARO vs. production for integrated companies excluding Saudi Aramco and the
MMboe) like Apache, EOG, Hess, Murphy, Russian majors, primarily offshore independents and primarily onshore independents,
FigureIntegrated-
4. ARO vs.Offshore
production Onshore
for integrated companies excluding Saudi
Santos, Wintershall, and Woodside, and year ending
100 December 31, 2021.
majors, primarily offshore independents and primarily onshore independ
24 OFFSHORE Figure 4. ARO vs. 2021.
production for integrated companies
y = 6.3969x excluding
www.offshore-mag.com Saudi
| MAY/JUNE 2023Aramco and th
10
majors, primarily offshore independents and primarily
R² = 0.6918 onshore independents, year ending
2021.
1
2305_06OFF22-25kais.indd 24 1 10 1002 1000 10000 5/22/23 8:46 AM
DECOMMISIONING CONTINUED
If Saudi Aramco and the four Russian companies are exclud- of integrated companies which are more expensive than
ed from the integrated group (Integrated-), the integrated onshore AROs: $20.4/boe (offshore), $12.8/boe (integrated-),
companies produced on average about four times more per and $6.4/boe (onshore).
barrel reserves (0.088 boe/boe). One might not suspect that such strong fits would result,
Public companies produce more of their reserves com- nearly as strong as the STM-production models, but because
pared to NOCs because of their development strategy and AROs/provisions are estimated under broadly similar guide-
capital requirements, and because NOCs are agents of the lines to STM, perhaps the relations are not that surprising since
state subject to their government’s geopolitical aims which AROs are also model constructs like STM.
fall outside profitability criteria. Political factors play a large ARO and production behave in a broadly similar manner
role in NOC decision making hidden behind the veneer of as reserves and STM with production, and since this is
corporate strategy. neither intuitively obvious nor self-evident, an empirical
For primarily onshore and offshore producers, a very sim- demonstration is both convincing and satisfying.
ilar relationship to the Integrated- group results, with the The slopes of the lines in Figure 4 provide valuable
model coefficient being 0.088 and 0.086 boe/boe (Figure 2). quantitative information on the relative difference in ARO
For all three groups, the production-reserves relations are cost per boe production by geographic specialization.
essentially identical. Independent offshore producers realize the highest ARO
unit cost, $20.4/boe, and independent onshore producers
STM vs. production the lowest ARO unit cost, $6.4/boe. Integrated companies,
Production generates revenue and is valued using cash excluding Saudi Aramco and the four Russian majors, fall
flow analysis over the lifetime of assets and reported as in-between these limits at $12.8/boe. ●
the standardized measure of reserves. STM values, along
with production and oil prices, are the three most import- Mark J. Kaiser is Professor at the Center for Energy Studies, Louisiana State University,
ant factors determining a company’s market capitalization Baton Rouge, Louisiana.
and enterprise value.
STM is computed according to a common set of assump-
tions across the FASB universe, and therefore, like proved
reserves, the valuation of reserves and production are expect-
ed to be strongly correlated.
STM and production are linearly related for all compa-
ny groups (Figure 3), with offshore producers realizing the
highest boe value at $139/boe, followed by integrated com-
panies at $96.7/boe, and $92.0/boe for onshore independents.
The slopes of the lines depend on oil price, and will
increase/decrease year-by-year increasing with higher
(average) oil prices during the reporting period and decreas-
ing with lower (average) oil prices.
Only five offshore producers report STM data so caution
is warranted in interpreting the $139/boe statistic. Offshore
companies may or may not fall within the range described
by onshore and integrated companies, $92/boe and $96.7/boe.
The fact that the line segments are roughly parallel is
also no accident, but indicative of industry similarity, at
least in the way STM values are computed, determined via
cash flow models using a similar set of assumptions accord-
ing to regulatory guidelines.
ARO vs. production

ARO and production are linearly related for each compa-
ny group and the results follow expectation (Figure 4). All
the company groups are well populated (14 integrated-, 23
offshore, 21 onshore) and the results are considered reliable
and significant.
Offshore producer AROs are greater per boe than a
mixed onshore/offshore production mix characteristic

2108OFF_RMYoungCo.indd 1 5/6/21 1:45 PM
2305_06OFF22-25kais.indd 25 5/22/23 8:46 AM

ESG FOCUS
Green hydrogen The Sealhyfe

green hydrogen
production
platform enters platform at the

quayside in
Saint-Nazaire
harsh environment
last September.
COURTESY LHYFE
offshore test
phase
Production module expected to be
deployed to an open-sea test site soon
Jeremy Beckman, EDITOR-EUROPE
T
esting of the world’s first offshore green hydrogen pro-
duction pilot plant will shortly transfer from the har-
bour at Saint Nazaire, western France to an open-sea test
site, operated by French engineering school Centrale Nante.
Nantes-based Lhyfe, which produced the first hydro-
gen using power from onshore wind turbines in 2021, has
adapted its technology to operate on a floating platform,
named “Sealhyfe.” The production module, secured to a
Wavegem wave energy structure, began operating in the which assisted the design of the underwater connection
harbour last September and has been producing up to 400 to the Floatgen wind turbine developed by a consortium
kg/d of hydrogen. On completion of this initial six-month led by BW Ideol. This recently exceeded 22 GW of electric-
phase, the Sealhyfe platform will be relocated to the SEM- ity production since commissioning in late 2019, and has
REV test site in the Atlantic, 20 km from Le Croisic. Here it operated at maximum capacity for more than 80% of the
will be powered by the Floatgen floating offshore wind tur- subsequent period.
bine (another demonstrator) that has been operating con- According to Lyhfe’s Technical Director Thomas Créach,
tinuously since installation in 2018. who has a background in offshore oil and gas and renew-
Lhfye, the project developer, collaborated with US com- able energy (as do other members of the management team),
pany Plug Power Inc to adapt the latter’s electrolyzer to power used during the initial trial period in the harbour is
operate on a floating platform. Other French offshore/ supplied locally via the French marine renewable energy
marine renewable energy specialists contributing to the hub: the electrolyser has a 1-MW requirement and the
program are local shipyard/engineering group Chantiers system auxiliaries 0.3 MW. The platform, with an overall
de L’Atlantique, responsible for structural strengthening weight of 330 metric tons, measures 21 m long and 14 m
to withstand environmental stress, the ventilation sys- wide, with an above-water height of 6 m.
tems and the electrical architecture; GEPS Techno, which “All the tests that are meant to be performed offshore
developed the Wavegem platform, also working with Eiffage (for a longer period of time) have been done during the
Energies Systèmes on integration of the production equip- harbour tests phase,” Créach said. “The remaining part is
ment with the platform; Port of Saint-Nazaire, which facil- the impact of the waves and exposure to weather condi-
itated assembly and testing; and Kraken Subsea Solutions, tions, which will be tested at SEM-REV. The system has
2305_06OFF26-28_lhyfe.indd 26 5/22/23 8:46 AM

been custom-designed for offshore applications, so it is automatically without interventions, except during sched-
already compliant and planned for this deployment, by uled maintenance periods.
design. However, some of the equipment could be modi- “Since the company’s early days, Lhyfe has been con-
fied following the port tests in order to increase its reliabil- vinced of the central role offshore has to play in large-scale
ity and particularly its mechanical resistance in offshore renewable green hydrogen production. In 2021, the compa-
conditions. The strategy of 100% autonomous control on ny built its Lhyfe Pays de la Loire plant in Bouin, western
a system powered by intermittent energy will also be the France Vendée to prove the feasibility of producing renew-
second offshore challenge.” able green hydrogen from a wind farm (and managing its
“Through this pilot site, Lhyfe will produce the first kilo- intermittency, and doing so at a good price). For more than a
grams of renewable green hydrogen at quay and then at sea, year now, that plant has been delivering its hydrogen to the
operating automatically, in the most extreme conditions. multi-energy filling station in La Roche-sur-Yon, and to the
The company has voluntarily set the bar high by install- Lidl logistics center where there are 98 hydrogen-powered
ing its production unit on a floating platform, connect- forklifts. With Sealhyfe, Lhyfe wants to demonstrate that
ed to a floating wind turbine. The Sealhyfe platform must producing renewable green hydrogen at sea is possible and
therefore meet several major and unprecedented challeng- define the optimizations required for future, larger-scale
es associated with hydrogen production at sea, including systems. That’s why the company chose the most extreme
converting the electrical voltage from the floating tur- conditions for its pilot (floating platform plus floating wind
bine; pumping, de-salinating and purifying seawater; and turbine). This has never been done and it includes a series
deploying electrolysis to break down water molecules in of major and unprecedented challenges – but as a world
order to produce green hydrogen. Other goals of the sea premiere, that helps the market to take a step forward.”
trial are managing the system’s impact on the platform’s The program has the support of the Pays de la Loire
motions – listing, swinging movements, accelerations – region, the Pôle Mer Bretagne Atlantique cluster, and
demonstrating that the system can withstanding prema- France’s strategic committee (CSF) for marine industry oper-
ture ageing of components caused by corrosion, impacts, ators. Other aims are to identify port areas and facilities that
and temperature variations. And being able to operate fully could accommodate different prototypes, and the industri-
al requirements and port infrastructure
needed for assembling and integrating
the equipment that would produce off-
shore hydrogen on a mass scale.
As for Lyhfe’s own green hydrogen
ambitions, by 2030-2035 offshore could
represent an additional installed capac-
ity of around 3 GW for the company,
Créach said. “Our next offshore project
will be to develop, build and operate a
larger production unit to demonstrate
the technical and financial viability
of producing renewable hydrogen off-
shore and transporting it by pipeline
to serve customers.” Various offshore
deployment solutions are under consid-
eration, he added, including renewable
hydrogen production platforms either
on existing fixed structures or on fixed
or floating foundations, “For each one,
specific partners will be involved, some
of them already contributors to the
Sealhyfe development. However, Lhyfe
remains the architect of the global solu-
The production module, secured to a Wavegem wave energy structure, has been tion and the operator of these systems in
producing up to 400 kg/d of hydrogen since last September. COURTESY LHYFE order to offer hydrogen to offtakers.” ●
2305_06OFF26-28_lhyfe.indd 27 5/22/23 8:46 AM

/////////
/////MOVING
///// FORWARD
OCT 23 – 25, 2023
Moody Gardens Hotel and Convention Center
Galveston, TX // offshore-event.com
OWNED & PRODUCED BY PRESENTED BY SUPPORTED BY
2305_06OFF26-28_lhyfe.indd
2304OFF_House_DTOPS.indd 281 5/22/23
2/26/23 8:46
7:52 AM
PM
SPECIAL REPORT
REMOTE INSPECTIONS
& OPERATIONS
An overview of the
latest trends in drones,
robotics, AUVs and
remote-controlled
operations
2305_06OFF29-45_RO SR.indd 29 5/22/23 8:46 AM

REMOTE OPS SPECIAL REPORT
REPORT: Overview
The rise of remote operations in the

offshore energy industry
Offshore operations are being revolutionized with companies can reduce the need for travel and save money on
transportation, lodging and meals. The workforce can spend more
remote technologies time with their families and reduce the environmental impact fre-
quent travel results in.
TROND NOTLAND, Remota AS Safety is increased by moving personnel away from the poten-
I
n the age of digital transformation, remote operations have tially harsh environment offshore. The offshore energy industry
become increasingly prevalent in the offshore energy industry. is known for its harsh and dynamic working environment, and
There has been a rise of remote technologies, such as unmanned remote operations can reduce the risk of accidents and injuries.
surface vessels, drones, robotics, remotely operated vehicles By using unstaffed or lightly staffed platforms, workers can avoid
(ROVs) and autonomous underwater vehicles (AUVs), that have exposure to hazardous materials and dangerous environments.
had an impact on offshore operations. From reducing travel costs This can improve safety and reduces insurance costs and liability.
to improving safety and efficiency, remote technologies have rev- Modernizing inspections with remote operations can also
olutionized the industry, making it more sustainable, diverse and improve the accuracy and speed of them. By using drones,
resilient. The world of remote operations has the potential to shape advanced cameras and sensors, inspections can be conducted
the future of the offshore energy industry. with greater precision and efficiency. This reduces the need for
physical presence offshore, which can be costly and time-con-
suming. With remote inspections, issues can be identified and
addressed quickly, reducing downtime and improving overall
productivity.
Finally, remote operations can contribute to sustainability
efforts. By reducing travel, companies can lower their overall
carbon footprint and minimize their impact on the environment.
Remote operations also allow for better resource utilization, as
companies can optimize their operations and reduce waste. This
contributes to a more sustainable and efficient industry overall.
Challenges
While there are many benefits with remote operations, there are
several challenges that must be addressed. With remote opera-
tions, the activities are often located far from the central office
Remota has remote operations centers in Norway that operate and may have limited access to communication channels. This
different offshore applications and subsea ROVs. COURTESY REMOTA can make it difficult to coordinate tasks and ensure that everyone
is on the same page. Companies must invest in robust communi-
The industry has always been associated with complex and cation systems to ensure that workers can communicate effec-
hazardous operations that require a lot of labor, time and resourc- tively and efficiently.
es. But with the recent push toward sustainability and cost effi- High latency can be a significant challenge for remote opera-
ciency, the industry is turning to remote operations as part of tions, particularly when using geo-stationary satellite systems for
the solution to these challenges. Remote operations refer to the communication. Latency refers to the delay between when data
use of unstaffed or lightly staffed vessels or platforms to con- are sent and received, and with satellite systems, the distance
duct tasks offshore, from inspections and maintenance to drill- that the data must travel can result in significant delays. This is a
ing and production. physical limitation of how fast the signal travels.
While low-orbit satellite systems offer many advantages, such
Benefits of remote ops as global coverage and lower cost compared to traditional satellite
One of the main benefits of remote operations is reduced travel systems, they can also suffer from high latency. This delay can be
costs. Offshore operations require a lot of travel, and this can especially problematic in remote operations, where split-second
be a significant cost for companies. By using remote operations, decision-making is often required.
2305_06OFF29-45_RO SR.indd 30 5/22/23 8:46 AM

One solution to this challenge is to use 4G and 5G networks off- One major concern is the potential for hackers to gain unau-
shore. These networks can provide faster and more reliable com- thorized access to the remote system and cause damage or
munication than satellite systems, with lower latency and higher disruption. Cyberattacks could lead to the loss of critical data,
bandwidth. Additionally, they can offer more security and priva- operational downtime or even physical damage to equipment.
cy than satellite systems, as the data are transmitted through a These threats pose financial risks and could also jeopardize the
private network. safety of personnel and the environment.
There are, however, challenges to implementing 4G/5G net- Another risk is the possibility of insider threats, where employ-
works offshore. These networks require significant infrastructure, ees or contractors with access to the remote system may intention-
such as towers and antennas, and may be affected by the harsh ally or unintentionally cause harm. This could include tampering
offshore environment, such as storms or sea spray. Additionally, with data or equipment, stealing confidential information or sab-
the initial investment and ongoing maintenance costs can be high, otaging the system.
which may be a barrier for some companies. Furthermore, the use of personal devices and unsecured net-
Despite these challenges, the benefits of 4G/5G networks for works could increase the risk of cyberattacks. If remote workers
remote operations are significant. They can improve communica- use their personal devices to access the remote system, they could
tion and decision-making speed, increase safety and efficiency, introduce vulnerabilities in the system’s security. Preventing unse-
and reduce costs compared to satellite systems. As the offshore cured networks, such as public Wi-Fi, is also important to prevent
energy industry continues to embrace digitalization and remote cybercriminals access to the remote system.
operations, these networks are likely to become an increasingly To mitigate these risks, companies need to implement robust
important part of the communication infrastructure. cybersecurity measures. This includes conducting regular cyber-
security assessments, monitoring system logs for suspicious activ-
Communication costs ities and implementing access controls to limit who can access
The costs of both satellite and 4G/5G networks can be high, which the remote system. Companies should also ensure that all remote
can be a barrier to adoption for some companies. For these com- workers are trained on cybersecurity best practices, such as using
munication technologies to become more widespread in the strong passwords and avoiding public Wi-Fi. A layered approach
offshore industry, it will be important to reduce their cost and where everyone is trained and equipped to prevent and recog-
increase their accessibility. nize cyber incidents is key.
One potential solution to reduce the cost of satellite systems is to In summary, while remote technologies have brought numer-
utilize shared networks, where multiple companies share the same ous benefits to offshore operations, they have also introduced new
satellite system and the associated costs. This can help to reduce cybersecurity risks. Companies must prioritize cybersecurity to
the upfront investment required for individual companies and make ensure the safety of personnel and equipment, protect confiden-
satellite communication more accessible for smaller companies. tial information and prevent operational downtime. This is a sub-
Similarly, the cost of 4G and 5G networks can be reduced through ject that also garner more focus in traditional maritime operations.
innovation and increased competition in the market. As more com-
panies adopt these networks for remote operations, there may be Workforce
economies of scale that result in reduced costs for everyone. Remote operations also require specialized training for workers.
Overall, while the cost of these communication technologies With unstaffed or lightly staffed vessels or platforms, workers must
is a challenge, it is important to continue exploring and investing be trained to operate and maintain the equipment properly. This
in them, as they offer significant benefits for the offshore indus- requires specialized skills and knowledge, which can be difficult
try in terms of safety, efficiency and environmental sustainability. to acquire and maintain. Companies must invest in training pro-
grams to ensure that workers are properly trained and can per-
Cybersecurity form their duties safely and efficiently.
Another challenge of remote operations is cybersecurity. With Remote operations may face resistance from workers and
unstaffed or lightly staffed vessels and platforms, there is a risk unions that are concerned about job security. By reducing the
of cyberattacks that can compromise sensitive information and need for physical presence offshore, remote operations may lead
operations. Companies must implement an effective cybersecu- to job losses or reduced work hours for some workers. Companies
rity program to protects against these risks, including encryption, must work with workers and unions to ensure that they under-
firewalls and regular security audits as safety measures. stand the benefits of remote operations and are prepared for any
The implementation of remote technologies, such as drones, changes that may occur. ●
robotics and AUVs, in offshore operations has significantly
reduced the risk of injury and improved overall safety. However, Trond Notland is the chief product officer with Norway-based Remota AS, which
it has also introduced new risks to cybersecurity. Remote oper- offers remote operations and semi-autonomous maritime services to the offshore and
marine industries by utilizing remote operating centers. Read an extended version of
ations are often controlled by digital systems, which can be vul- this article at offshore-mag.com/14292805.
nerable to cyberattacks such as hacking, phishing and malware.
2305_06OFF29-45_RO SR.indd 31 5/22/23 8:46 AM

REMOTE OPS SPECIAL REPORT: Drones
Autonomous drone technology increasing

efficiencies of offshore platform inspections
Autonomous drones are lowering risk while
increasing data quality and efficiency for complex
offshore platform inspections
STERLING HAYS, Skydio
T
he oil and gas industry is under pressure to deliver value in a
turbulent economic environment. Digital strategies can provide
distinct advantages, and for years, energy executives have expect-
ed drones to play a significant role in operations.
Progress has been seen, but mass adoption of drone technolo-
gy for offshore platform inspections hasn’t happened yet. Artificial
intelligence (AI) is rapidly changing the paradigm with reduced
costs, increased efficiency and improved safety. Skydio, the largest
US drone manufacturer, is partnering with industry leaders such as
Shell and contractor CAN USA to de-risk, demonstrate and prog-
ress the inspection capabilities available for offshore operations.
Empowering human operators

One of the most significant barriers to adoption has been lack of An autonomous drone inspects an offshore platform and
accessibility. Traditional drones simply cannot efficiently oper- captures thousands of images per day to generate
ate in offshore environments because they require expert pilots comprehensive, repeatable, consistent inspection datasets.
COURTESY SKYDIO, SHELL, CAN USA
to manually fly with limited space and visibility in unpredictable
weather conditions. However, AI-powered autonomous drones
use advanced computer vision to automatically navigate com- inspectors to identify potential issues that may not be visible to
plex environments, avoid obstacles and adapt to changing envi- the naked eye before they become more serious and costly to
ronments in real time. Easy to operate and hard to crash, existing repair. High-quality data help optimize maintenance schedules,
workforces can fly them with just a few hours of training. New travel and logistics, further cutting costs and carbon footprint.
innovations in drone docking stations even allow for fully automat- In a 2021 report, “Necessity is the Mother of Re(Invention) in Oil
ed remote inspection workflows, running scheduled “missions” & Gas,” Accenture cites connectivity as a key competitive advan-
without the need for a dedicated individual to pilot the device. tage but identifies significant gaps—only 15% of industry leaders
The physical locations of offshore platforms make for another agree their remote operations are highly connected and moni-
major accessibility hurdle that AI clears with ease. When flight is tored in real time. Similarly, lack of emphasis on cybersecurity is
based on AI computer vision rather than GPS, autonomous drones a “serious blind spot.” When evaluating drone manufacturers, look
aren’t restricted to satellite range, making for seamless naviga- for SOC 2 Type II Certification, which validates an internal con-
tion in GPS-denied environments, such as under metal structures. trol environment focused on protecting the security and privacy
of customer information, and National Defense Authorization Act
Reducing downtime (NDAA) compliance, indicating the US federal government has
Downtime leads to lost revenue. Rapid and accurate inspections confirmed the drone hardware is secure and critical components
are paramount to diagnosing damage before it can lead to expen- do not come from blacklisted countries.
sive downtime. Autonomous drones enable always-on inspection Continuing to realize the efficiency, safety, cost savings and poten-
without the need to shut down, navigating tight spaces and flying tial that drones bring to offshore platform inspection requires ongo-
at heights hazardous and typically inaccessible to humans with- ing collaboration across industry, regulatory and manufacturers. ●
out a time-consuming scaffolding setup. They generate compre-
hensive, repeatable, consistent datasets and 3D maps, enabling Sterling Hays is solutions engineer with Skydio’s Public Safety & Enterprise division.
2305_06OFF29-45_RO SR.indd 32 5/22/23 8:46 AM

REMOTE OPS SPECIAL REPORT: Robotics
Transforming offshore operations:

The rise of autonomous inspection robots
Autonomous inspection robots have the potential
to transform offshore asset monitoring
DR. MARCO HUTTER, ETH Zurich and ANYbotics; and
DR. PÉTER FANKHAUSER, ANYbotics
A
dvanced robotic technology is revolutionizing offshore facility
inspections, making them safer, more efficient and cost-ef-
fective. This article delves into the capabilities of autonomous
inspection robots, their impact on the oil and gas industry, and
their potential to transform offshore asset monitoring as well
as reviews various types of robots and the future prospects of
fully autonomous, unmanned offshore facilities operated by
robotic workers.
Automating offshore
facility inspections
The wide variety of offshore oil and gas
platforms, such as fixed platforms, com-
pliant tower platforms, jackup platforms ANYmal X, the world’s only Ex-proof
and floating production systems, share legged inspection robot, performs
common operational challenges arising inspection missions on an offshore
from potentially explosive atmospheres, platform. COURTESY PETRONAS
complex infrastructure, extreme weather
conditions and remote locations. delivering frequent, accurate and reliable
Operators constantly seek real-time results. High-quality sensors, extreme
data from their assets to monitor asset mobility and AI-based inspection intelli-
health and take timely preventive action. gence allow these robots to perceive and
Today fixed installed sensors already analyze beyond human capabilities and
monitor critical process aspects like tem- be easily deployed, even in older brown-
perature, pressure and flow rates. Additionally, operators per- field facilities. Inspection robots perform continuous monitoring
form regular inspection rounds, typically within each work shift, with hundreds of inspection points per deployment and execute
to look for signs of damage or wear on equipment. However, the multiple precise tasks simultaneously. Inspections can be sched-
logistical challenges and expenses of accessing offshore plat- uled as routine, relevance-based monitoring, or on-demand, con-
forms, as well as the importance of personnel safety, complicate ditional or ad hoc inspections.
these inspections. Specific offshore inspection jobs automated by these
To mitigate safety risks and collect better data than manual robots include:
inspections, oil and gas companies are increasingly adopting • Visual and acoustic monitoring of assets in operation to detect
autonomous ground robots for routine inspection work. The latest equipment failures early and take preventive maintenance
generation of autonomous inspection robots can traverse oil and actions to avoid costly defects and downtime;
gas facilities designed for humans and collect data in complex • Identifying thermal anomalies to gain previously undetect-
environments without human intervention. ed insights into equipment health through thermal trend
analyses; and
Inspection robots automating jobs • Real-time monitoring and localization of the presence and
Autonomous inspection robots provide significant value to off- concentration of flammable and toxic gasses to enable early
shore operations by performing inspection tasks autonomously, operator action.
2305_06OFF29-45_RO SR.indd 33 5/22/23 8:46 AM

REMOTE OPS SPECIAL REPORT: Robotics
Four-legged robots can climb

stairs and easily negotiate steps,
pipes and other obstacles.
COURTESY ANYBOTICS
inspection robots increasingly

attractive for offshore use.
Operators such as Shell, Petro-
nas and bp have been working
with robots for several years, and
the adoption of Ex-proof inspec-
tion robots has recently gained
These capabilities allow inspection robots to support and com- momentum among many offshore operators. Autonomous, legged
plement humans in generating alerts, making critical decisions, Ex-proof inspection robots are transforming offshore monitoring,
responding early to detected anomalies and automating end-to- with operators increasingly incorporating these robotic solutions
end workflows and preventive maintenance. into their inspection and workforce planning.
Autonomous inspection robots not only reduce health and
Challenging offshore inspections safety risks but also help mitigate an increasing workforce
Offshore inspections are challenging for both robots and humans shortage, one of the main reasons for the accelerated adop-
due to complex terrain, corrosive atmospheres, high winds, high tion of robotic solutions. Additionally, operators benefit from
seas, and potentially dangerous or unpredictable situations. reduced manual labor, fewer people in hazardous environments
Areas handling flammable or explosive gasses or liquids are and decreased unplanned downtimes. Autonomous inspec-
Ex-rated, requiring Ex-certified, intrinsically safe equipment, tion robots contribute to safer, greener and more efficient off-
such as ATEX or IECEx certification. These areas include zones shore operations.
(Zone 0, Zone 1 or Zone 2) depending on the occurrence and
duration of explosive atmospheres. Zone 1 certification is nec- Future development
essary to bring inspection robots close to process areas where The use of autonomous mobile inspection robots represents a
they provide the greatest value. While the industry has devel- paradigm shift and fundamentally changes the perception of the
oped standards for heavy machinery, it remains challenging for constant need for the physical presence of human workers. As
agile robots to comply. a result, fleets of robotic workers will increasingly be remotely
Several robots on the market are certified for use in hazard- managed by human supervisors. The accelerated use of inspec-
ous environments, but their capabilities vary depending on their tion robots in the offshore oil and gas industry is a positive trend
locomotion mechanisms. Robots with wheels or tracks, such as expected to continue in the coming years. With the continued
the ExR-2 from ExRobotics, are well-suited for flat terrain but may development of AI-driven capabilities, robots are a key enabler
struggle in more complex environments. Some tracked systems, in the acceleration of digitization and automation.
like the Inspector from Taurob and EX ROVR from Mitsubishi Heavy In addition to inspection, robotic manipulation is a rapidly evolv-
Industries, are equipped with “flippers” that allow them to traverse ing field involving the development of robots that can manipu-
more complex terrain, including high steps. late objects. In the oil and gas industry, manipulation will allow
However, larger robots may have difficulty navigating narrow robots to handle equipment, take samples and perform simple
environments. To address this, some robots, such as the ANYmal maintenance tasks.
X from ANYbotics, use legs to provide maximum flexibility. These The concept of unmanned offshore oil and gas facilities specif-
robots can negotiate steep stairs, step over piping and navigate ically built with robots in mind has gained traction in recent years,
narrow environments due to their ability to move sideways. When and interest in developing such facilities is growing. These facilities
selecting a robot, it is important to consider the specific needs would be operated entirely by autonomous systems and robots,
of the application, as the choice of locomotion mechanism can requiring little or no human intervention and reducing overhead in
significantly impact its performance in different environments. living quarters, HVAC, desalination and safety requirements. The
potential benefits of safety, efficiency and cost reduction make this
Transforming offshore asset monitoring concept a promising area for future development. ●
The oil and gas industry is a hotbed of innovation driven by the
need for efficient production, safety, cost control and improving Dr. Marco Hutter is a professor at ETH Zurich, Branco Weiss Fellow, co-founder and
vice chairman of ANYbotics.
the long-term sustainability of operations. Technological advanc-
Dr. Péter Fankhauser is co-founder and CEO of the Swiss robotics company ANYbotics.
es in autonomy, mobility and inspection intelligence have made
2305_06OFF29-45_RO SR.indd 34 5/22/23 8:46 AM

REMOTE OPS SPECIAL REPORT: AUV/ROV
Executive insights: Remote operations are

evolving with ROV/AUV advancements
Oceaneering executive details the challenges and He listed several other examples of technology advances,
including onshore remote operations centers, which are dedi-
solutions of remote operations cated facilities that act as operational hubs for remote piloting
activities and that he said are enhancing efficiency and collabo-
ARIANA HURTADO, Editor and Director of Special Reports ration between teams.
R
emote operations is a big area for Oceaneering, with estab- Resident robotic systems, such as Oceaneering’s Liberty E-ROV,
lished facilities for remote operations in Norway, Aberdeen reduce the need for support vessels and offshore personnel,
and along the Gulf of Mexico (GoM). Oceaneering has carried out resulting in cost savings and reduced carbon emissions, he added.
remote commissioning, remote pipeline pigging, remote survey “In the asset inspection and integrity management space, the
and rig positioning, and remote inspections. ability to collect data with drones, quadbots and sensors (for
Earl Childress, Oceaneering’s senior vice president and chief image, rotating information, gas, temperature, material deterio-
commercial officer, shared insights with Offshore about the evo- ration) is improving with great speed,” Childress said, offering
lution of remote operations, the disadvantages and challenges another example of a notable technology advancement. “These
of remote ops, remote commissioning, R&D, automation capa- things, combined with improvements in software and the use of
bilities, offshore wind remote ops, and the state of the offshore artificial intelligence [AI] and machine learning to process data,
energy industry. are delivering impressive results, such as the integration of new
“Remote operations are continuously evolving to address chal- technologies tested onshore for subsea like stress concentration
lenges in the offshore energy industry by increasing efficiency, tomography in ROVs.
reducing costs, minimizing risks and lowering the environmental
impact of operations,” he said. “Technological advancements play Challenges
a crucial role in these improvements. Some notable recent advanc- While there are numerous advantages of remote operations for
es include improved connectivity and communication, such as offshore oil and gas projects, there are also some challenges that
high-speed networks (4G LTE and satellite connections), which offshore oil and gas operators face.
have enabled better communication between onshore and off- Childress listed latency and network reliability being one of the
shore personnel, allowing for smoother remote piloting and real- disadvantages. “Remote operations depend on reliable and low-la-
time collaboration.” tency communication networks. In areas with poor connectivi-
ty or high latency, remote operations
can face difficulties,” he explained.
“Oceaneering addresses this chal-
lenge by working with operators to
provide the required communication
networks, using LTE, geosynchronous
satellites or low earth orbit satellites, to
ensure reliable connectivity.”
He also listed IT security as a
challenge. “Secure communication
between onshore and offshore per-
sonnel is crucial to protect sensitive
data and maintain operational integ-
rity,” he said. “Oceaneering has devel-
oped robust IT security measures and
fail-safe systems to overcome poten-
tial cybersecurity threats and maintain
secure communication channels.”
Lastly, Childress said a resistance
The illustration showcases Oceaneering’s remote operations capabilities. COURTESY OCEANEERING to change can be another setback.
2305_06OFF29-45_RO SR.indd 35 5/22/23 8:46 AM

“Traditional offshore operations might be hesitant to adopt remote is a significant challenge,” he said. “Solutions involve staying
piloting due to concerns about reliability, safety and operation- updated on the latest regulatory updates, collaborating with local
al efficiency,” he said. “Oceaneering works to build confidence in authorities and implementing technology that adheres to region-
its remote piloting capabilities by showcasing our extensive track al requirements.”
record, redundancies and offshore control measures.” Additionally, offshore oil and gas operations in regions like the
Offshore oil and gas operators face a variety of remote opera- Arctic, the North Sea and the GoM face extreme weather con-
tions challenges that can vary by region and environment. Accord- ditions, which can hinder remote operations. “Solutions include
ing to Childress, some of the most common challenges include developing specialized equipment and tools designed to with-
infrastructure limitations, regulatory compliance and harsh envi- stand these conditions, implementing real-time monitoring sys-
ronments, and other issues may include integration with existing tems and using advanced analytics to optimize operations and
methodologies and adoption of new techniques. minimize downtime,” Childress said.
“Today, the crews conducting remote operations have prior
experience working in a physical offshore environment. In the Remote commissioning ROV
future, we may see crews that have never been offshore or only The company’s Liberty E-ROV resident vehicle has performed
have limited experience,” he suggested. “This could introduce a numerous subsea production systems commissioning tasks as
future operational risk where the crews become more disconnect- part of its regular operations.
ed from the operations. Therefore, new training programs will be “Liberty performs commissioning by remote operations without
needed to address the adoption of new technology and the new needing the installation vessel to stay on station for the full com-
way of working.” missioning operation,” Childress explained. “Liberty has its own
Regarding infrastructure limitations, remote operations requirebattery pack, subsea garage and communication buoy allowing
reliable communication networks, which may be limited in cer- it to stay subsea for longer without support.”
tain areas. “Solutions include investing in communication infra- It also helps with decarbonization strategies. A conventional
structure, such as satellites and subsea communication cables, to ROV will emit 644 metric ton of CO2 on an average 14-day inspec-
ensure stable connectivity regardless of location,” Childress said.
tion, maintenance and repair campaign, but the Liberty E-ROV by
As for regulatory compliance, different regions have specif- contrast will emit 178 metric ton of CO2 over the same time period,
ic regulatory requirements for offshore operations, including saving approximately 466 metric ton of CO2.
remote operations. “Ensuring compliance with these regulations As of April 20, the Liberty E-ROV has completed 163 missions
and almost 14,000 operational hours. It has
eliminated 10,000 support vessel hours or
roughly 400 vessel days, thereby eliminating
19,000 tons of CO2 emissions by eliminating the
need for the support vessel to stay on station
while the ROV works. By bringing workers back
to shore, Oceaneering’s remote operations
have eliminated 240 personnel crew changes
(12-hour shifts over 14-day trips).
Liberty also assists with decommissioning
tasks, and the resident vehicle recently con-
ducted a remote subsea pipeline isolation for
a major North Sea operator.
“Traditional pipeline isolation programs call
for an onsite support vessel for most of the
work,” Childress said. “However, Liberty does
not require one to stay on station. For this oper-
ation, a remotely controlled high-pressure, pig-
gable isolation tool was selected, which allows
pipeline isolation without requiring the system
to be fully evacuated. Liberty tracked and mon-
itored the pigging tool’s position as it navigat-
ed the pipeline.”
Oceaneering has an onshore remote operations center in Stavanger, Norway. Operations were monitored from an
COURTESY OCEANEERING Oceaneering onshore remote operation center
2305_06OFF29-45_RO SR.indd 36 5/22/23 8:46 AM

in Stavanger, Norway, and the operator was able to save eight
vessel days, reducing carbon footprint and realizing cost savings.
On the technology horizon

“Oceaneering is continuously working on developing innovative
ROV and subsea robotics technologies to enhance their capabil-
ities and efficiency,” Childress said. “One such project is the Vir-
tual Command Center (VCC), which provides a centralized and
real-time digital twin for all Oceaneering’s assets related to remote
operations.”
The technology horizon for Oceaneering, he continued, also
includes advancements in AUVs, AI and machine learning as well
as augmented reality (AR) and virtual reality (VR). For instance,
Oceaneering is in the R&D stage for advanced AUVs capable
of operating independently or in tandem with ROVs to per-
form complex subsea tasks, such as pipeline inspections and
seabed mapping.
“Leveraging AI and machine learning technologies, Oceaneering Illustration of Liberty E-ROV launch and recovery system
aims to improve the efficiency and reliability of ROVs and subsea COURTESY OCEANEERING
robotics, enabling them to perform tasks with increased precision
and accuracy,” he added. “Integrating AR and VR technologies more energy-efficient electric actuators. This results in lower
into the VCC and other remote operations systems can provide energy consumption, reduced operational costs and minimized
operators with immersive and interactive experiences, facilitat- environmental impact.
ing better collaboration, decision-making and problem-solving.” • Greater automation: Digitalization enables the development of
advanced control systems that can automate many aspects of
Automation subsea operations. Autonomous subsea vehicles can perform
So, how is electrification and digitalization enabling automation tasks independently, while semi-autonomous vehicles can be
capabilities and enhancing remote operations workflows? controlled remotely with minimal human intervention, increas-
Childress said, “Electrification and digitalization are driving ing efficiency and reducing the risk of human error.
forces behind the enhancement of automation capabilities and
remote operations workflows in the offshore energy industry. Offshore wind remote ops
These advancements enable subsea resident vehicles, includ- Oceaneering released its high-speed, high-current capable Isurus
ing fully remote-controlled or autonomous vehicles, to perform ROV in 2019 with offshore wind and renewables projects in mind,
tasks more efficiently, accurately and with reduced environ- and the fifth and sixth Isurus vehicles were released in 2022.
mental impact.” “Based on our proven Magnum ROV, the Isurus features a
He named several ways that electrification and digitalization more hydrodynamic design allowing it to maintain position in
contribute to these improvements: challenging weather conditions, extending operating windows,”
• Enhanced communication: Digitalization allows for high-speed, Childress said.
real-time communication between onshore control centers and The company has worked in Europe and Asia for renewables
subsea resident vehicles. This improved connectivity enables customers since 2021.
remote operators to monitor, control and receive feedback CEO Rod Larson said in October 2022 that the industry is in an
from underwater equipment more effectively, reducing the “offshore resurgence” and Childress added to this idea, sharing
need for onsite personnel and allowing for more informed his own perspective on the state of the offshore energy industry.
decision-making. “I believe that there is a durable upcycle in traditional energy
• Improved data collection and analysis: Digital sensors on subsea with growing opportunities in renewable sources of energy and
resident vehicles collect vast amounts of data during operations. carbon capture,” he said. “We are exploring additional opportuni-
Advanced data analytics and machine learning algorithms can ties through a new strategic agreement, announced in late Jan-
then process these data to identify patterns, trends and anom- uary this year, with Kontiki Winds, a Havram company, to jointly
alies, providing valuable insights for optimizing operations and pursue the application of floating offshore wind for remote micro-
maintenance schedules. grid renewable power generation to electrify offshore assets
• Increased energy efficiency: Electrification of subsea equipment such as oil and gas production as well as other small scale power
reduces reliance on hydraulic systems and enables the use of generation opportunities.” ●
2305_06OFF29-45_RO SR.indd 37 5/22/23 8:46 AM

Advanced ROV vision

systems are the future of
subsea operations
New technology employs edge video, at the expense of the image data
required for 3D modeling. Conversely,
computing to capture high- inspection cameras prioritize image data The Voyis Discovery Vision System
quality stills images in tandem at the expense of piloting effectiveness, inspects a large underwater structure.
limited by their higher latency and a small- COURTESY VOYIS
with low-latency video er field of view.

CHRIS GILSON and PATRICIA
SESTARI, Voyis Imaging Case study
The Discovery’s capabilities were evaluat-
S
ubsea inspection operations are an ed on a trial project where an uncharted
intricate task that have historical- flooded quarry was explored for the first
ly required specialized knowledge and time during the Canadian winter. A Video-
complex technology. ROVs are a critical Ray Defender ROV was outfitted with the
tool for underwater exploration, inspec- vision system and deployed through a hole
tion and maintenance, but their effective- cut in the ice. The 4K video stream enabled
ness is driven by the quality of their vision effective piloting to identify a target, while The software interface shows 3D model
systems. Current ROV cameras prioritize the instantaneous 3D point cloud data was and stills images captured by Voyis
vehicle piloting and situational awareness, leveraged to evaluate data quality, cover- Discovery Vision System in real time.
COURTESY VOYIS
which are the most immediate needs of age and to maintain a consistent target
the operators. However, when both pilot- range using the added depth perception.
ing and inspection confidence can be A complete 3D reconstruction was quick-
significantly enhanced with 3D informa- ly generated using a selected segment of
tion, the industry should seek to adopt the dataset, attaining a comprehensive set
new approaches. of qualitative and quantitative visual data
Voyis, a company specializing in under- on the subsea asset—crisp video, high-res-
water optical imaging and 3D modeling, olution stills images and an accurate 3D
has advanced ROV vision systems with model. This delivered a complete under-
new computer vision technology. The goal standing of the structure and an assess-
was to create a vision platform that could ment of its condition.
capture both low-latency enhanced video The system was easily integrated using
for piloting while simultaneously captur- the vehicle’s existing power and ethernet
ing high-quality stills images for real- infrastructure, rapidly deploying this new This 3D model was generated by Voyis
time 3D modeling. The company sought a capability on the small platform. The Nova Discovery Stereo. COURTESY VOYIS
solution that could generate incredible 3D Mini lights provided high-intensity, uniform
reconstructions in real time without spe- lighting that drastically improved the qual- operations, a capability available for small
cialized technicians or expensive third-par- ity and clarity of the images compared to platforms using the compact 300-m Dis-
ty processing. the standard piloting camera. In a single covery Camera and on large work class
By leveraging edge computing, Voyis’ day, the Voyis team was able to effectively ROVs with the 4,000-m Discovery Stereo.
Discovery Vision System streams both integrate and operationalize the Discovery By employing edge computing to cap-
crisp 4K piloting video and 3D point cloud in a new environment to acquire an accu- ture high-quality stills images in tandem
data for complete situational awareness, rate 3D reconstruction of a subsea asset. with low-latency video, it achieves a vision
addressing the compromise between The success of the Discovery Vision system without comprise. It is now pos-
piloting cameras and inspection camer- System highlights its potential to revo- sible for every subsea vehicle to see the
as. Piloting cameras prioritize low-latency lutionize subsea inspections and ROV depths like the surface is seen. ●
2305_06OFF29-45_RO SR.indd 38 5/22/23 8:46 AM

Autonomous robots use AI for data collection

and intervention services
AI streamlines subsea called Nauticus’ toolKITT, which utilizes
operations, enhances AI and machine learning to power auton-
omous, surface and untethered subsea
productivity and safety robotic platforms. It serves as the “mind”
for robotic vessels, unifying all of Nauticus’
DR. JD YAMOKOSKI, Nauticus Robotics
products into a single control architecture
T
he ocean covers 71% of the Earth’s to enable advanced subsea work.
surface and intersects nearly all daily toolKITT is predicated on the vehi-
activities, such as food, energy and trans- cle’s ability to make decisions about the
portation. It is a $3 trillion economy that environment from onboard sensors. It is
few people think about, much less consid- self-improving, meaning its ability to solve
er its impact on daily lives and the future. problems and complete tasks becomes
Legacy practices in the offshore indus- more efficient and precise over time.
try have remained largely unchanged Therefore, AI-powered robots can sub-
since their inception more than 50 years stantially improve the outlook of offshore
ago. This inertia has resulted in wide- operations compared to legacy methods.
spread operational inefficiencies, indus-
try stagnation and climate degradation. Reducing emissions
Artificial intelligence (AI) has the power AI plays a crucial role in streamlining off-
to radically change that reality by stream- shore activities, which improves oper-
Aquanaut underwater robot runs solely
lining operations, enhancing productivity, ational efficiencies and lowers costs as
on electric power, and Nauticus Robotics
and protecting not only human crews but well as drastically minimizes environ- says it is the first subsea robot that is just
the future of the ocean environment itself. mental impact. as versatile as it is sustainable. COURTESY
Nauticus Robotics, a developer of auton- Common legacy solutions require up NAUTICUS ROBOTICS
omous robots using AI for data collection to $100,000 per day or more to operate
and intervention services for the ocean and often need large crews to do so, yet Safety
economies, believes AI’s benefits in off- they’re riddled with operational ineffi- The efficiencies created by AI innovations
shore work has potential to continue dis- ciencies. In contrast, software-enabled significantly increase safety. From 2012-
rupting an antiquated industry for the solutions like toolKITT, when paired with 2020, the US Bureau of Safety and Environ-
betterment of the oceans. intelligent all-electric robots, have the mental Enforcement collected data from
power to integrate seamlessly into work- 4,474 offshore incidents, resulting in 1,654
Advancing subsea work flows to accomplish more with less. A injuries and 23 deaths. Autonomous robots
Historically, subsea work involved a ship single pair of intelligent robots can per- allow for a future with significantly less
steaming out and dropping a heavy ROV form complicated subsea tasks auton- risk involved in completing a job because
in the water connected by thousands of omously, with more precision and in fewer people will be needed on site.
feet of cumbersome umbilical back to the significantly less time.
ship. This expensive, manual technique Incumbent methods endanger the Conclusion
has gone largely untouched for decades, planet by emitting up to 70 mt of CO2 into AI has the potential to create a future where
while topside the robotics revolution has the atmosphere daily, which is the equiva- more autonomous and intelligent robots
been exploding. lent of 5,000 cars on the road. When multi- are used to reduce environmental impact
Nauticus leverages and develops plied by the number of vessels doing work and eliminate human exposure to hazards
approaches to support subsea applications, in the ocean, its impact is huge. Nauticus’ while improving the offshore industry in
with a specific focus on enabling opera- AI-powered, all-electric technology can every way possible. Nauticus is working to
tor-supervised, autonomous inspection and reduce the estimated CO2 footprint of off- make that opportunity a reality. ●
manipulation tasks. These advancements shore vessels by more than 90% and lower
start with a software-enabled solution value stream costs by 50%. Dr. JD Yamokoski is Nauticus Robotics’ CTO.
2305_06OFF29-45_RO SR.indd 39 5/22/23 8:46 AM

Troubleshooting problems has become a

more manageable process
C-I performs remote survey work offshore La. The team was challenged from the beginning with its first
project being based out of Guyanese waters. Operating at such a
Guyana from its Louisiana headquarters distance challenged C-I, and ultimately, the company performed
successfully over a span of two years.
TIM BINGHAM, C-Innovation During the 2020 Guyana project, C-I operated a fully remote
M
any oil and gas majors are now increasingly moving towards survey spread in international waters with zero recordable down-
options that enable them to reduce vessel days and therefore time and was consistently ahead of schedule in the client’s fleet,
their carbon footprint, as well as eliminating risks to personnel. remotely providing GVI/SURF inspections, as-laid/left surveys,
C-Innovation (C-I), owner and operator of Schilling Robotics valve operations, flowline/umbilical surveys, mooring line surveys,
ROV systems, provides a range of specialized remote diagnostic BOEM surveys, buoy placement and recovery operations, and USBL
and mission-planning software as well as augmented reality and calibration/validations.
mid-water StationKeep systems. Its inspection class, heavy-duty The Guyanese project was the precursor that set up the com-
150-HP and ultra-heavy-duty 200-HP ROVs are used to conduct pany’s success near its home in the Gulf of Mexico.
a wide range of inspection type work.
In the past two years, drawing upon its submarine ROV techno- Recent projects
logical capabilities that offer clients a system-wide platform, C-I C-I has performed several remote surveying operations over the
has completed more than 30 hull inspections in the Gulf of Mexico, past year. For example, in January 2022, C-I began remote opera-
Alaska, Atlantic Ocean and Brazil. These inspection services vary tions on Juan C , including BOEM inspections, mooring line inspec-
in operational tasks and include hull inspections, UWILDS, bull- tions, and USBL calibration/validations.
seye and riser inspections for drill support, and pipeline surveys. During summer 2022, C-I enabled simulation operations on
In addition to being equipped with HD video, C-I’s ROVs inte- the Island Venture vessel, and the company successfully enabled
grate tooling due to their modular system and device configura- remote access to the platform to view the Island Venture ROVs.
tion software. Examples of tooling capabilities for inspection work Then, in August 2022, C-I began remote operations on the
include camera booms, 3D modeling, UT/CP monitoring systems, C-Constructor vessel, which included jumper ops, mooring line
mux integration, lasers and subsea cleaning tools. inspections, tree/well installations and USBL calibration/validation.
At year-end 2022, C-I began remote operation with GIS, and this
Offshore Guyana case study included remote navigation for geophysical work in Mexican waters.
C-I’s fully remote operations have been available since the com- More recently, in February 2023, C-I began remote operations
pany first entered the remote survey industry in April 2020 at the on Laney. The client required remote viewing at the base in Prov-
height of the COVID-19 pandemic. idence, Rhode Island. The company set up a live working system
C-I’s goal was to provide its client with offshore services while involving plough operations to be viewed remotely.
operating safely from the company’s headquarters in Mandeville,
Surveying vessels
C-I has five vessels that are actively involved in remote survey
operations, which increases safety and reduces greenhouse-gas
emissions to the environment. Operating out of the company’s
remote operations center (ROC) at C-I’s headquarters, its remote
surveyor eliminates the risk for potential personal injury while
onboard the vessel and cuts down on travel hazards to and from
a vessel or heliport.
By placing an experienced remote surveyor on duty at the ROC
with the ability to log in to any vessel in the fleet, troubleshoot-
ing any potential problems has become a much more manage-
able process. ●
C-Innovation performs an underwater plet inspection. COURTESY
C-INNOVATION Tim Bingham is survey manager with C-Innovation.
2305_06OFF29-45_RO SR.indd 40 5/22/23 8:46 AM

REMOTE OPS SPECIAL REPORT: Remote-controlled operations
Affordable offshore
well monitoring lowers
P&A costs
Digital innovations are driving adoption of
satellite-powered monitoring
THIERRY ZOIS, Hiber
E
very well’s life has a hard stop, but the plug and abandon-
ment (P&A) process can feel never-ending. The P&A proce-
dure itself costs multiple $100,000s, compounded by years of site Today’s smart satellite-powered technology can monitor remote
wellhead data, enable better abandonment strategies and
visit costs (in terms of teams, transportation and pure opportuni-
eliminate surprises. COURTESY HIBER
ty cost). Can the latest satellite technology make well abandon-
ment less painful? Shell had already calculated the costs of sending teams of engi-
Until recently, connecting wells to satellites was too expen- neers in helicopters or boats to manually collect data for 12 months
sive to be a practical solution for monitoring abandoned wells. Its or more. The company wondered whether this new satellite tech-
power requirements made it impractical for remote applications, nology could reliably and cost-effectively monitor two platforms.
and networking limitations, which limited the distance between Hiber’s team worked with Shell on a pilot using the HiberHilo oil
wellhead sensors and the satellite gateway, added to the hard- and gas technology to validate its predictions. HiberHilo is a turn-
ware costs. However, the arrival of Internet of Things, along with key well and pipeline monitoring tool that includes sensors, soft-
three major technical innovations, has redefined what is possible ware, satellite connectivity and continued service.
(and affordable) with remote well monitoring: In April 2021, Shell’s crew installed pressure sensors on annuli
• Long-range networks: Developments in long-range networks that required close monitoring and network gateways to facilitate
have redefined the economics of satellite monitoring. It provides wireless satellite communication. The entire installation of the solu-
a terrestrial coverage radius of 10 km, which means numerous tion took less than three hours, with the sensors connected to the
wellhead sensors can share a single satellite gateway, reducing satellites within 15 minutes. It was so fast that the Shell engineers
the complexity and cost of networking hardware. estimated they could have performed another 15 installations that
• Bite-size data packets: Traditional 24/7 data-gathering moni- same day. Plus, when the team started using HiberHilo, 99.8% of the
toring solutions have been supplanted by a new generation data collected were logged in Shell’s monitoring system.
of solutions that employ intelligent data gathering and trans- Instead of going offshore monthly to check for possible pressure
mission. Instead of beaming data continuously (which is both buildups, Shell’s technical team can now continually monitor these
unnecessary and expensive), today’s smart sensors sample key abandoned wells and implement a comprehensive P&A strategy.
data every few minutes, then transmit it each hour. While users This reduction in trips reduced the cost of the decommissioning
will not receive real-time data, they will get regular updates of campaign by an estimated €120,000 ($132,516), while at the same
mission-critical information at an affordable price. time improving the integrity of the decommissioning plan.
• Power optimization: Small, efficient data transmissions have Furthermore, this approach lowered the probability of remedial
enabled improved power optimization. Instead of being a pow- work and reduced rig time, unlocking another potential €300,000
er-hungry monster, new satellite well-monitoring tools use ($331,290) in savings. Importantly, the solution also improved crew
much less energy, which translates into savings for operators. safety and reduced the environmental impact of platform visits.
At the end of the project, once the P&A campaign has completed,
Case study the sensors and gateways can be easily transferred to the next
Today’s smart satellite-powered technology makes it easy to tap platform on a rolling schedule.
into remote wellhead data, plan better abandonment strategies In conclusion, this resulted in a cost reduction and increased
and eliminate surprises. To see it in action, look to the North Sea, sustainability. ●
where Shell has a portfolio of old wells dating back to the ’60s
and ’70s, many of which are in the process of being abandoned. Thierry Zois is Hiber’s chief commercial officer, based in the Netherlands.
2305_06OFF29-45_RO SR.indd 41 5/23/23 8:11 AM

Remote survey services reducing project

carbon footprint, mobilizations and costs
Sophisticated communications hardware
provides connectivity to bring data processing
ashore and reduce survey costs
TORSTEN MARTEN, UTEC
I
n the energy sector, the acquisition and processing of data asso-
ciated with operations has traditionally involved the mobiliza-
tion of personnel and equipment to offshore locations around the
globe. However, with the need to minimize carbon footprint and
costs, which are particularly important considerations for clean
energy stakeholders, operators are looking for innovative ways to
develop and operate assets across the renewable energy, oil and
gas, and nearshore construction industries. A remote operation center conducts monitoring for an uncrewed
Acteon, a marine energy and infrastructure services company, survey vessel. COURTESY UTEC / ACTEON
reviews the impact of a remote technology that can be deployed
to reduce survey costs and increase project efficiency. Within a other travel costs while retaining access to highly skilled per-
project life cycle, the overall operational schedule can be improved sonnel when required. The carbon footprint of operations can
by optimizing the individual survey tasks and conducting some be reduced and improved safety is realized from a reduced off-
of those activities remotely. From site characterization through shore headcount. Because data-processing personnel are only
to decommissioning, accurate survey data enable the operator paid for the time they work on the data, and not their mobiliza-
to plan, mitigate potential challenges and choose the optimal tion and standby time, cost savings are generated that can be
design solution. passed on to clients.
One piece of technology used by Acteon to enhance overall
project efficiency is the communications hub (comms hub) devel- Case study
oped by UTEC, a geo-services brand in Acteon’s Data and Robot- Havfram was required to perform a decommissioning project in
ics division. It provides the communications security and network Mauritania that involved the removal and disposal of subsea infra-
resilience required to deliver all types of remote services using any structure. The survey services included post-decommissioning
available internet connection. While bringing data ashore in real multibeam echo sounder (MBES) surveys carried out by an ROV.
time, the comms hub checks the characteristics of each bonded A UTEC comms hub installed on the Havfram vessel Island
link for error rate, packet loss, jitter and latency to determine which Victory provided automated file transfer functionality, facilitating
way a particular packet should be dispatched. By adapting rapidly remote data processing. Without requiring additional bandwidth,
to network conditions found offshore, where the characteristics the comms hub automatically transferred the MBES data with
of satellite links change frequently, the comms hub enables net- backscatter intensity measurement enabled.
work acceleration, bringing data ashore securely and efficiently.
The comms hub can provide live H.265 video streams from a Conclusion
remotely operated vehicle (ROV) or any camera on board a vessel, By facilitating remote services, Acteon is bringing ashore many
to multiple onshore and offshore locations without the need to of the tasks traditionally conducted offshore, achieving signifi-
mobilize any additional equipment or personnel. The comms hub cant project time and cost savings. Simultaneously, risk expo-
facilitates remote operation of online navigation software and sure and carbon emissions associated with offshore mobilizations
remote technical support by providing direct remote access to are reduced.
the offshore survey network. Additionally, it enables remote data Acteon is continuing to invest in remote capabilities to support
processing via automated file transfer in close to real time. operators, particularly in the offshore wind sector. ●
As the remote technology can reduce personnel on board by
up to 30% by bringing tasks onshore, it reduces aviation and Torsten Marten is a lead surveyor with UTEC.
2305_06OFF29-45_RO SR.indd 42 5/22/23 8:46 AM

Opinion: Nigeria needs to take the leap

toward adopting digital twins
Digital twins provide a blueprint for operators need a new approach to digital transformation and
an increased focus on maximizing the good times and minimiz-
overcoming the gaps in Nigeria’s oil and gas ing the downturns.
digital transformation journey James Fisher AIS’s rollout of its R2S digital twin technolo-
gy is one example of how Nigeria is benefitting from a differ-
ADESHINA ADEBUSUYI, James Fisher AIS ent approach through collaborative partnerships and offering
a compelling alternative to previous digital transformation
T
he digital transformation in Africa is advancing in leaps and attempts, while also building mutual trust and understanding.
bounds, with Nigeria leading the charge as home to the most The key to putting theory into action is establishing a culture
technology hubs across the continent. shift away from the traditional business model that relies on
Despite this technology spike, Nigeria’s energy industry is lag- quickfire sales. The focus must instead be on establishing long-
ging behind its global peers putting its ambition to be a gas-pow- term partnerships with oil and gas companies to jointly mitigate
ered economy by 2030 at risk. their valuable concerns through consultative engagements.
Nigeria’s oil and gas potential could unlock economic prosper- With the investment almost equal for both partners, Nige-
ity and lift millions out of energy poverty. Previously hampered rian oil and gas companies can have renewed confidence
by a lack of oil and gas infrastructure, progress is finally being in adopting emerging technologies such as data analyt-
made in Nigeria following former President Buhari’s “Decade ics, digital twin and predictive maintenance. This approach
of Gas Initiative,” alongside the long-awaited reforms delivered lends itself to being scalable and adaptable. Those hesitant
through the Petroleum Industry Act. to give digital transformation another try can start with a
Despite planned projects, such as the Dangote refinery and small amount of change and then scale that change up on
several LNG plants, Nigeria’s checkered history with the use of the back of success.
digital technology within the offshore oil and gas industry could Those companies that have taken the leap toward adopt-
jeopardize this potential success story with many companies ing digital twins can now present 2D data, visual data and
becoming disillusioned by digital transformation. real-time data in a real-world context, allowing teams to plan
better and swiftly make important operational decisions. Data
Pitfall of digital distrust that were once siloed, outdated and disconnected has become
Most oil and gas decision makers were sold a vision of dig- useful, robust and accurate, providing visibility to the remot-
ital transformation; however, these purchases not only failed est of assets.
to improve output, but also did not solve the challenges they
were bought to resolve. It has become an all-too-common pit- Knowledge transfer
fall, engineered by unscrupulous sales teams, leading to dis- Finally, creating opportunities for knowledge transfer means
trust and hesitance in adopting new innovations that would that Africa’s oil and gas industry can confidently champion its
have a positive impact. digital transformation. Making this vision a reality, James Fisher
While industry leaders elsewhere are benefiting from the AIS is delivering a training school in Angola that equips new
latest innovations in digital twins, data analytics and remote industry recruits with the digital skills needed to operate oil and
maintenance, many Nigerian workers are working from incom- gas assets efficiently. It also opened headquarters in Lagos,
plete plans and Excel spreadsheets. They waste lots of time giving companies direct access to experts that understand the
looking for data siloed across several systems—or worse, not region’s specific needs and its digital heritage.
captured at all, residing solely in colleagues’ memories. Overcoming the gaps in digital transformation through col-
laborative partnerships will be paramount if Nigeria is to fully
Overcoming digital disillusionment benefit from the forthcoming boom in oil and gas infrastruc-
The challenge of balancing the volatility of oil price with main- ture and be considered as an industry heavyweight on the
taining margins means that digital transformation is often over- world stage. ●
looked. Without it, Nigeria’s domestic supply and exports may
rise, and economic prosperity will not be unlocked to the full- Adeshina Adebusuyi is regional business development manager with
James Fisher AIS.
est potential. To mend the rift created by digital disillusionment,
2305_06OFF29-45_RO SR.indd 43 5/22/23 8:46 AM

AI tools improving
HSE, reducing
unplanned downtime
COURTESY SPARKCOGNITION
AI is unequivocally transforming
offshore operations
JASON CHADEE, SparkCognition
W
ork on an offshore rig is physically demanding, unpredictable
and potentially dangerous. While pay and benefits are excellent, days for around-the-clock surveillance for machine monitoring,
seamen and offshore workers perform duties within proximity to antipiracy deterrents and workplace safety. CCTVs alone collect
highly combustible materials while handling massive cranes, hoist- and store visual data but are only effective with dedicated staff
ing systems, pumps, engines and other heavy equipment on unsta- monitoring 24/7, a practical impossibility given inevitable oper-
ble vessels and slippery decks, and often in challenging weather. ator fatigue. Even when information is successfully collected, it
Oil rig incident and death reports are moving targets. It is widely only provides retrospective evidence.
acknowledged that the offshore oil and gas industry is one of the Offshore extraction companies can configure and deploy vision-
most dangerous in the world, yet there is no reliable system for based applications, leveraging existing infrastructure, using a low-
tracking and reporting injuries and fatalities. What is definitive is code/no-code scalable AI-enabled computer vision program.
the dangers associated with the job. When coupled with a library of pre-existing use cases for safety
Between 2008 and 2017, there were more than 1,500 deaths and security, computers and systems can capture and interpret
on oil rigs in the US. In its 2021 safety report, the International meaningful information from image and video data and respond
Association of Oil and Gas Producers showed an increase in the accordingly in real time, transforming them into proactive analyt-
number of deaths in the industry overall, from 14 in 2020 to 20 in ical assets that provide actionable insights and automated alerts
2021. The total injury rate was 0.77 in 2021, a 10% increase from to manage risks, processes and workforce safety.
the year prior and 580 lost workdays. A 2021 private investigation Platform operators can flag HSE compliance failures or insuffi-
found that the Bureau of Safety and Environmental Enforcement, cient personal protection equipment, identify persons in distress,
the government agency created to improve safety and enforce and spot potential damage to inventory and impending accidents,
environmental regulations in the offshore oil and gas industry, which results in cost savings, improved reputation and increased
underreports the number of offshore worker deaths due to incon- overall safety in daily operations.
sistent or missing data or loopholes that allow some fatalities to AI modeling can also improve rig or platform availability at
go unreported. scale, creating financial incentives while improving safety for engi-
In 1983 the Occupational Safety and Health Administration neers and operators. When deployed onshore in a remote control
(OSHA) and the US Coast Guard entered into an agreement giving center, it provides alerts, alarms and can trigger automated proto-
OSHA statutory authority to promulgate regulations that address cols increasing overall operational visibility. When fully deployed
working conditions on offshore drilling platforms. OSHA maintains across an entire fleet of offshore rigs or platforms, AI modeling
that the safety of oil rig workers is a leading priority and has enacted can significantly impact the economics of a business.
measures to mitigate safety and health hazards and dangerous con- AI is unequivocally transforming offshore operations. It
ditions, but reactionary workplace safety initiatives are insufficient. improves health and safety management initiatives, helps mini-
mize unplanned downtime and production impacting events, pro-
Benefits of AI actively manages periodic maintenance and reduces costs, helps
With the industry’s commitment to safety at its strongest, visual reduce the carbon footprint, maximizes the life of assets and can
artificial intelligence (AI) is being deployed as a proactive approach offer advanced cyber threat detection. ●
and technological disruptor in limiting injuries and loss of life on
offshore installations. Jason Chadee is a global energy sales executive with 25 years of experience in
solving complex operational problems with software solutions for oil and gas, utilities,
The is a visual AI technology available today that utilizes the
and renewables markets.
closed-circuit televisions (CCTVs) that are ubiquitous on rigs these
2305_06OFF29-45_RO SR.indd 44 5/22/23 8:46 AM

Examining an evolution in FPSO

autonomous operations
A new project is underway to advance safety
performances of a global FPSO fleet
MATT TREMBLAY, ABS
T
he FPSO fleet is in the midst of a generational shift in the tech-
nology available to support offshore operations. For 50 years,
maintenance management and condition evaluation have been
a labor-intensive, analog exercise. Today, a new technology-driv-
COURTESY ABS
en agenda is enhancing a safety-first approach with the adop-
tion of tools and systems that improve safety, performance and
operating costs.
Following the launch of the recent ABS “Guide for Autonomous The goal-based framework covers interactions with relevant stake-
and Remote-control Functions,” which sets out a goal-based holders such as port authorities and other vessels. It uses a risk-
framework for the implementation of these technologies on ves- based approach to determine the requirements for the assessment
sels and offshore units, a new project is underway to advance and implementation of autonomous and remote control functions.
safety performances of a global FPSO fleet. Autonomous functions are those in which machines perform
An FPSO operator has proposed to add remote control function- each of the four steps in the operational decision loop (i.e., moni-
ality to their newly installed FPSO, which is under ABS class. The toring, analysis, decision and action), without the need for human
FPSO is currently located offshore in a new and rapidly develop- intervention to perform tasks and achieve the system mission.
ing area that has challenges with local resources and transporta- Autonomous functions do not follow predefined routines and oper-
tion infrastructure. The proposed plan is to add a remote control ational scenarios. They have the ability to execute the most appro-
center called an Integrated Operation Center (IOC) located at a priate actions based on their programming, assigned mission and
nearby shore-based facility to add remote control functionality. tasks, operational environment and the system status.
The FPSO will be connected to the IOC via fiber-optic cables with Remote control functions are an approach whereby the
redundant capability. A small crew would also remain on the unit system and operation being monitored is controlled remotely by
to serve as oversight. This initiative by the FPSO operator is to add a human operator who is physically located elsewhere other than
remote functionality to all topside process-related functions and on board a marine vessel or offshore unit where the operations
large equipment packages such as turbines, compressor, gener- take place. There is a minimal crew on board for oversight and
ators, etc. However, the work scope does not presently include emergency operations.
plans to control the typical marine systems or marine operations The FPSO project is just one of the many growing examples
such as stores transfer, station keeping and bunkering via the IOC. in which the offshore industry is rethinking the methods to con-
The project will be executed in three phases. Phase 1 will use duct asset inspections, collect and evaluate condition data, reduce
remote monitoring to verify all systems are working as they should costs and increase safety, while ensuring reliability. ABS experts
and that there are no major problems. In Phase 2, the operator can also explore with their clients the latest artificial intelligence
will gradually add remote functionality for selected modules and tools used to aid in corrosion detection and measurement and the
equipment packages. In Phase 3, remote functionality to all top- potential of an accurate digital condition model, or digital twin, to
side modules, system and equipment packages will be imple- support modern risk-based inspection techniques.
mented. The scope covers both hardware and software digital For this project, ABS will dedicate locally assigned survey teams
architecture assessments and cybersecurity risk assessments and other ABS experts. ABS surveyors will perform the duties
and management system. required for classification surveys, and a training program is being
The work is based on ABS’ recent guidance and cross-indus- implemented for the client’s technical teams to ensure the techni-
try collaboration on remote control and autonomous notations. cal staff remain qualified and to ensure the work is done in a safe
Development of this guidance was informed by experiences with and consistent manner. ●
rocket launching and recovery vessels as well as remote control
and autonomous tug projects in Europe, Asia and the Americas. Matt Tremblay is ABS vice president, Global Offshore.
2305_06OFF29-45_RO SR.indd 45 5/22/23 8:46 AM

BUSINESS BRIEFS
Offshore announces the 2023 Subsea Tieback Forum Advisory Board
Company News
ABB has completed the divestment
of its UK technical engineering
consultancy business, part of its Energy
Industries division, to TÜV Rheinland.
Rovco, a provider of technology-
enabled project solutions to the
offshore renewable energy sector,
has launched a new marine site
characterization business line. The
new division will serve the offshore
energy sector, providing clients with
a comprehensive range of survey
solutions, including hydrographic,
geophysical, shallow geotechnical,
metocean and environmental surveys.
FROM LEFT TO RIGHT: Amanda Bergin, Baker Hughes; Matthew Obernuefemann,
Paradigm Flow Services has split
ExxonMobil; Pablo Gomes, Petrobas; Tony Matson, Trendsetter Engineering; Randy into two separate entities: Paradigm
Seehausen,Staatsolie; John Smiley, Shell International E&P, Inc; Walid Soliman,bp; Jason Flow Services and Paradigm Fire
Harry, Hess Corporation; Advisory Board Chairman Bruce Crager, Endeavor Management: Protection Services.
Karl Schnakenburg, Woodside Energy; Julie Ingram, McDermott; Chris Egan, TechnipFMC;
Erin Balch, Wood; Mike Clarke, Beacon Offshore Energy; Antonio Critsinelis, Chevron Energy Eco Wave Power Global AB has
Technology Co.; Conference Director David Paganie, Offshore; Nikunj Patel, Oceaneering opened a US subsidiary under the
International. NOT PICTURED: Maria Bulakh, Aker Solutions; Ron Ledbetter, College of name Eco Wave Power US. The
Engineering TAMU; Phillip Luce, OnseSubsea; Glenn Mediamolle Jr, LLOG Exploration; Cort company plans to also establish a
Prois, Occidental US Offshore; Ian Ramsay, Navitas Falklands; JR Salinas, Equinor; Jeremy corporate office in New York City,
Woulds, Subsea 7 which will be its first office in the US.
Learn more about the conference at subseatiebackforum.com/2024.
People directors that he plans to

step down. He will continue
vice president of Australian
operations. Westcott most
bp has appointed Starlee in his current role until his recently held the role of
Sykes CEO of Archaea successor is in place. COO at EnergyAustralia.
Energy, and Andy Krieger The International Marine Fraser Moonie has been
will succeed Sykes as Contractors Association appointed COO of Rovco.
senior vice president of has announced that Iain BW Offshore has
bp’s Gulf of Mexico (GoM) Grainger will succeed appointed Anders S.
and Canada business. Allen Leatt as CEO when Platou as chief strategy
After nearly seven years he retires at the end of May. officer, effective July 1. He Fraser Moonie
at the helm of the Net Colonna’s Shipyard Inc. previously held the role of
Zero Technology Centre has promoted Randall head of corporate finance
(NZTC), Colette Cohen Crutchfield to executive and strategy.
OBE is standing down vice president (EVP) and Petrobras’ board of
as CEO, with Myrtle COO, Jordan Webb to EVP
Colette Cohen directors has elected
Dawes announced as OBE of shipyard operations and Mário Vinícius Claussen
the NZTC’s new CEO. Chris Hartwig to senior Spinelli as the company’s
Rebecca Allison has been director of Steel America. chief governance and
promoted to COO.
North Star has appointed compliance officer, with
After more than six years James Bradford CTO. James Bradford a term until April 13, 2025,
as Prosafe’s CEO, Jesper the same term as the
Woodside has appointed
Kragh Andresen has other members of the
Liz Westcott executive
informed the board of executive board.
2305_06OFF46_bb.indd 46 5/22/23 8:46 AM

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2305_06OFF47_adx.indd 47 5/22/23 8:46 AM

BEYOND THE HORIZON
Robots: over-promised, over-hyped, but now real
I
t’s old news in oil and gas industries that there’s a skilled Such robots vastly surpass the best that could be built
labor shortage, as there is in every industrial sector. And as recently as 2015 in a Grand Challenge from DARPA
it’s getting worse due to demographics, the “silver tsuna- (Defense Advanced Research Projects Agency). That con-
mi,” and cultural realities enervating students’ appetites test was industrially-oriented: an untethered robot needed
for pursuing trades in “old” industries, even though they’re to ascend a staircase, open a door, and turn a valve – tasks
essential for all the new, shiny products and services. inherent to operating within a human environment, and
It’s long been known that industrial automation can help all previously beyond the capabilities of any robot. In late
here, by amplifying the effectiveness of those, of any age, 2021 DARPA held another challenge, where teams com-
with skills. But automation has done little to alleviate the peted using wheeled, tracked, or walking robots to per-
skills gap for most tasks in most industries. form mining-like tasks in a network of caverns. One of
Of the millions of industrial robots in the world today, the contestant’s robots, for example, was able to survey
the majority are isolated to bolted-down or high-volume and build a detailed subterranean map in one hour, a task
tasks, found in automobile manufacturing or similar facto- that entailed 100 person-hours of human surveyors prior
ries. As the need for task flexibility rises, or the size of the to the contest.
firm shrinks, the robot share shrinks faster. Even for firms Two years ago, Boston Dynamics offered for commer-
of over 500 employees, just half have industrial robots. And cial sale (base price at $74,500) its autonomous, ambulatory
you won’t find any industrial robots in 90% of America’s four-legged automaton, Spot, the same year Digit went on
manufacturing enterprises. the market. That such robots are now being offered for sale
That isn’t because managers don’t see the need. That auto- is more than a mere curiosity. It will be seen in hindsight
mation yields more output per employee is intuitively obvious as a Model T moment in history.
and borne out by history. Robots are underused in industries Digit’s skills target warehouse-like tasks which similarly
because of a simple fact; they haven’t been good enough, yet. consume valuable (human) time in industrial domains. And
Until now, there wasn’t any prospect for robots that both Spot, initially, is seeing deployment for safety surveillance
match or exceed human performance and can be reassigned on offshore oil platforms, refineries, and construction sites,
to new tasks, and that can also work safely alongside people, on farms, and in factories. Inspection is self-evidently crit-
instead of isolated and bolted down, or limited to fixed tracks. ical but inherently repetitive and is the kind of drudgery
We’ve seen myriad demonstrations and stunts in the race that lends itself to error and oversight; i.e., ideal for robots
to produce real robots. Only recently have engineers finally while letting people upskill for other tasks.
built anthropomorphic robots, even if most are not yet com- At least two dozen companies are designing pre-com-
mercially viable. As with the arrival of the automobile age, mercial anthropomorphic or mobile robots, from start-ups
the (true) robot is made possible by the confluence of a suite to industrial giants such as Toyota. Elon Musk announced
of technologies. The car itself was only possible because of that Tesla would soon commercialize a walking robot
the independent maturation of high-strength steel, internal called Optimus.
combustion, and oil refining. For robots it’s the arrival of pow- The warehouse “logistics” markets has become the
erful micro-motors, vision “chips” enabled by AI, and lithium hotbed for robot development and deployment, forecast to
batteries. While the latter two components have received the displace automotive as the growth sector, with spending
most attention, useful robots wouldn’t be possible without forecast to grow 300% more over the next five years than
the contemporary and remarkable 50-fold gain in the power- the past five. Given the close alignment in tasks and perfor-
to-weight ratio of tiny motors over the past several decades. mance metrics, all that commercialization will accelerate
Boston Dynamics’ human-like Atlas robot meets that robot capabilities for the adjacent heavy industries.
definition of a true anthropomorphic robot, as does Digit Soon, the labor-productivity boost from robotification
from Agility Robotics, for example. While Digit is less agile, will echo what happened a century ago with industrial
it is both cheaper ($250,000 versus a rumored $1 million) mechanization. More business, more services, new kinds of
and commercial now. Nonetheless, Atlas illustrates the jobs replacing old ones, and more wealth and well-being. ●
near future of bots that have human-like capabilities to
run, jump, back-flip and navigate autonomously. Mark P. Mills, Manhattan Institute senior fellow; strategic partner, Montrose Lane
2305_06OFF48_bey.indd 48 5/22/23 8:46 AM

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NOIA | THE U.S. GULF OF MEXICO C1
2305CP_NOIA.indd 1 4/28/23 6:08 PM

Erik Milito,
President of NOIA
The author, National Ocean Industries Association President

Erik Milito, leads industry efforts to advance smart public
policy decisions in support of domestic energy production and
to promote the industry as an innovator, problem-solver, and
preferred investment choice. Erik has been at the forefront of
efforts to develop and establish industry programs to enhance
safety and environmental performance, including the NOIA
ESG Network, The Environmental Partnership, and the Center
for Offshore Safety. Erik previously served as Vice President,
Upstream Policy for the American Petroleum Institute and as
an attorney for the U.S. Department of the Interior. Erik also
served on active duty in the U.S. Army as a judge advocate.
He holds a Juris Doctor from Marquette University Law School,
and a Bachelor of Business Administration from the University
of Notre Dame.
2305CP_NOIA.indd 2 4/28/23 6:08 PM

ABOUT NOIA
For the past 50 years, the National Ocean
Industries Association (NOIA) has represented
the interests of all segments of the offshore
energy industry, including offshore oil and gas,
offshore wind, offshore minerals, and offshore
carbon sequestration. NOIA membership includes
energy project leaseholders and developers and
the entire supply chain of companies that make
up an innovative energy system contributing
to the safe and responsible exploration,
development, and production of energy for the
American people.
NOIA represents and advances a dynamic and

growing offshore energy industry, providing
solutions that support communities and protect
our workers, the public and our environment.
NOIA is the sought-after and credible voice,
advocate and forum for uniting and advancing
the interests of the offshore energy industry,
Photo [this page] 1138600700 © MsLightBox ; [cover] 146757957 © michaelbwatkins | gettyimages.com

recognized for promoting solutions that provide
the energy vital for lifting society in a safe and
environmentally sustainable way. NOIA’s work
in Washington, D.C. with Congress and the
Administration consistently results in positive
public policy outcomes that support investment
in U.S. offshore projects, with an emphasis on safe
and responsible development.
NOIA | THE U.S. GULF OF MEXICO 1
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CONTENTS
5 Introduction: the Offshore Gulf of Mexico is a Strategic
National Energy Asset and an Energy Innovation Hub
7 Recognizing Our Energy Realities
11 U.S. Offshore Energy Development Delivers Vast,
Uplifting Benefits for Americans
11 Offshore Energy Development Enhances Energy Security
11 Oil and Natural Gas Will Be Crucial Energy
Sources for Decades to Come
14 Oil and Natural Gas Account for a Large
Share of U.S. and Global Energy
16 Offshore Oil and Gas: Capital Investment in Acreage
and Exploration Results in Production
19 The Continuously Improving Efficiency of U.S.
Gulf of Mexico Offshore Development
20 The Gulf of Mexico Is Poised for Continued
Global Energy Leadership
28 Gulf of Mexico Production Improves Energy Affordability
36 Gulf of Mexico Energy Development Stimulates
Domestic Spending
38 The U.S. Gulf of Mexico Supports High-paying Jobs
41 The U.S. Gulf of Mexico Provides Among the Lowest
Carbon Barrels in the World, with a Commitment to
Safety and Environmental Performance
47 The Offshore Gulf of Mexico is Characterized by
Innovation and Advanced Technologies
49 Offshore Facilities Create and Support
Flourishing Marine Ecosystems
52 The U.S. Gulf of Mexico Adheres to a Strong System
of Safety and Environmental Protection
56 U.S. Offshore Energy Production Generates Tremendous
Value for Taxpayers, Including Funding for the Land & Water
Conservation Fund, the Outdoor Recreation Legacy Partnership
Program, and Coastal Resiliency And Restoration
60 Companies in the Offshore Oil and Gas Supply Chain Play a Key Role
in Investing in, Scaling, and Deploying Low Carbon Solutions
63 Offshore Energy Development Increases
Our National Security
65 The Gulf Coast’s Role in the Emerging U.S. Offshore Wind Industry
67 The Gulf’s Central Role in Offshore Carbon Capture And Storage
71 Conclusion
PARTNER PROFILES
73 EXMAR Offshore
74 bp
75 MSRC
76 Quality Companies
77 Oceaneering
2 NOIA | THE U.S. GULF OF MEXICO
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Photo 172304385 © MsLightBox | gettyimages.com
NOIA || THE
NOIA THE U.S.
U.S. GULF
GULF OF
OF MEXICO
MEXICO 3
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INTRODUCTION
■ THE OFFSHORE GULF OF MEXICO IS

A STRATEGIC NATIONAL ENERGY ASSET
AND AN ENERGY INNOVATION HUB
The Gulf of Mexico is globally recognized as a premier global energy hub,

bringing together the companies that produce foundational energy sources
such as oil and gas, while leading innovation and investment in energy
sources and technologies that will drive decarbonization efforts well into
the future. In essence, the oil and gas industry is often in the vanguard of the
development and deployment of zero carbon, low carbon, and carbon removal
technologies. The offshore energy sector has unparalleled expertise and
experience deploying and scaling technologies at levels necessary to achieve
decarbonization objectives. Companies throughout the offshore oil and gas
supply chain continue to lead the way in innovating low emission solutions that
include offshore wind, carbon capture and storage, hydrogen, and geothermal,
among others.
For the foreseeable future, the U.S. Gulf of Mexico offshore energy sector will
play an integral role in shaping an energy system that promotes the provision
of affordable and reliable energy while simultaneously continuing to reduce
the environmental and emissions footprint of development and distribution.
Importantly, for the coming decades, oil and gas supplies will remain a vital
Image 1020383430 © FrankRamspott | gettyimages.com
energy source for Americans and our allies around the globe1.
1. https://www.eia.gov/outlooks/aeo/
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RECOGNIZING OUR
ENERGY REALITIES
■ ENERGY LIFTS SOCIETY

A system of reliable, abundant, and affordable energy is essential for meeting
basic societal needs, including healthy living conditions, health care, education,
and mobility, economic or otherwise.
Oil and gas fill the fuel tanks of passenger vehicles and airplanes. They are
transformed into the essential building blocks of smartphones, clothing, and
medical equipment. They are in many products we use every day that underpin the
conveniences of modern life.
Natural gas is recognized as a key energy source for providing electricity, heating,
cooling, and clean cooking. More than 750 million people around the globe do
not have access to electricity, which leaves entire communities at a severe and
fundamental disadvantage. According to the World Health Organization (WHO),
“Access to energy is critical when it comes to the functionality of health-care
facilities and the quality, accessibility and reliability of health services delivered.
Electricity is necessary for the operation of critically needed medical devices such
as vaccine refrigeration, surgical emergency, laboratory and diagnostic equipment,
as well as for the operation of basic amenities such as lighting, cooling, ventilation
and communications.”2
Globally, 2.6 billion people do not have the means for clean cooking and must
Photo 1317214769 © curraheeshutter | gettyimages.com
use solid fuels such as wood, crop wastes, charcoal, and dung in open fires and
inefficient stoves. The WHO attributes 3.8 million premature deaths each year to
indoor air pollution caused by the fumes and soot generated by inefficient and
dirty cooking.
2. https://www.who.int/activities/accelerating-access-to-electricy-in-health-care-facilities
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The tragic impacts of energy insecurity are not only experienced abroad; 44 percent of
low-income American households experience energy insecurity, spending 10 percent to
20 percent of their income on energy expenses3.
Energy insecurity has adverse consequences on both physical and mental health.
Millions of Americans are faced with the “heat or eat” dilemma, regularly having to
choose between paying utility bills and paying for food4.
All forms of energy, including oil and gas, wind, solar, nuclear, geothermal, and emerging
forms of energy such as hydrogen, can play a role in raising the standard of living and
lifting communities out of poverty. The offshore energy sector is particularly well
poised to deliver reliable, abundant, and affordable energy of many types for society.
Traditionally recognized as a key producer of oil and gas, the offshore sector has
emerged as a leader in offshore wind, is spearheading the deployment of carbon
capture and storage technologies, and is playing a vital role in developing innovative
hydrogen technologies.
Operations in the U.S. Gulf of Mexico demonstrate that it is possible to develop

offshore resources while adhering to the highest safety and environmental standards.
A multitude of companies involved in offshore energy development are working
collaboratively to shrink an already small carbon footprint. From electrifying operations
to deploying innovative solutions that reduce the size, weight, and part count of
offshore infrastructure – thus increasing safety and decreasing emissions – the U.S.
Gulf of Mexico hosts a high-tech revolution.
Currently, global oil consumption is approximately 100 million barrels per day. Various
scenarios forecast global oil consumption volumes through 2050 and beyond, and
nearly all of them predict substantial oil production will be necessary through 2050. The
question is, “Where should that oil come from?”
The answer is from the cleanest and safest sources.
Oil produced from the U.S. Gulf of Mexico has a carbon intensity one-half that of other
producing regions.5 The technologies used in deepwater production – which represents
92 percent of the oil produced in the U.S. Gulf of Mexico – place this region among
the lowest carbon intensity oil-producing regions in the world6. Policies that restrict
domestic offshore development require imports to make up the shortfall, and that
supplemental production comes from higher-emitting operations in other countries.
Foreign providers generally employ less environmentally conscientious production
3. http://large.stanford.edu/courses/2020/ph240/radzyminski2/
4. S. Jessel, S. Sawyer, and D. Hernández, “Energy, Poverty, and Health in Climate Change: A Comprehensive Review of an
Emerging Literature,” Front. Public Health 7, 357 (2019).
5. Motiwala, and Ismail, “Statistical Study of Carbon Intensities in the GOM and PB,” ChemRxiv, April 13, 2020.
6. https://www.woodmac.com/news/the-challenge-of-negative-emissions/
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Photo 1410488206 © Leigh Ann Speake | gettyimages.com
methods, which when combined with the added emissions from transporting oil
over great distances by tanker, increases the amount of carbon released into the
atmosphere rather than decreasing it.
Emissions reduction is a global challenge. As analysts at Wood Mackenzie explain,

“Removing or handicapping a low emitter hurts the collective global average.” 7 This is a
debilitating solution with devasting consequences.
The better choice is to institute government policies that promote cleaner and safer
domestic production, less reliance on higher-emitting foreign suppliers like Russia and
China, and the preservation of hundreds of thousands of American jobs.
On the other hand, restricting U.S. offshore energy development could eventually
lead to Americans of every walk of life having to contend with the issues Europe is
experiencing as a result of disrupted supply from Russia, including potential industrial
curtailment and families having to make difficult choices between heat and food.
7. https://www.woodmac.com/news/opinion/could-restricting-oil-production-in-the-us-gulf-of-mexico-lead-to-
carbon-leakage/
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U.S. OFFSHORE
ENERGY DEVELOPMENT
DELIVERS VAST,
UPLIFTING BENEFITS
FOR AMERICANS
■ OFFSHORE ENERGY DEVELOPMENT

ENHANCES ENERGY SECURITY
OIL AND NATURAL GAS WILL BE CRUCIAL ENERGY

SOURCES FOR DECADES TO COME
Oil and natural gas touch every part of our daily lives. Fundamentally, “Everything
that is fabricated, grown, operated or moved is made possible by hydrocarbons.”8
The U.S. Department of Energy states:
Oil and natural gas play an essential role in powering America’s vibrant
economy and fueling a remarkable quality of life in the United States.
Together, oil and natural gas provide more than two-thirds of the energy
Americans consume daily, and we will continue to rely on them in the
future. In addition to meeting our energy needs, oil and natural gas are
Photo 604033056 © curraheeshutter | gettyimages.com
integral to our standard of living in ways that are often not apparent.
Several key advances in technology enabled a dramatic increase in
domestic oil and natural gas production over the past 20 years. This
increased production provides energy security and economic benefits to
the entire country, and ongoing technology advances will help us to enjoy
those benefits into the future.
8. Mark Mills, Wall Street Journal, January 8, 2019
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Oil and natural gas are used in many ways that are familiar to consumers. Petroleum
products power transportation, providing fuel for cars, trucks, marine vessels,
locomotives, and airplanes. Natural gas generates more than one-third of the electricity
needed for dependable heating, air conditioning, lighting, industrial production,
refrigeration, and other essential services, and tens of millions of Americans rely on oil
and natural gas to heat their homes directly and on clean burning natural gas to cook
their food. But petroleum products do so much more than fuel our cars and power our
homes and businesses.
While perhaps less recognized, oil and natural gas also play critical roles in supplying
essential products and materials, increasing agricultural productivity, and supporting
the expansion of new energy sources.
Oil, natural gas, and natural gas liquids are building blocks for a range of modern
materials used to produce life-changing prosthetics, energy-efficient homes, safer
cars that go farther on a gallon of gasoline, and hundreds more consumer products that
Americans use every day. Plastics and chemicals derived from oil and natural gas make
our food safer, our clothing more comfortable, our homes easier to care for, and our
daily lives more convenient.
Natural gas is also a key ingredient for chemical fertilizers, helping increase crop
production and yield per acre planted, and powering many important operations on the
farm like crop drying.9
According to the United Nations, access to affordable, reliable, and sustainable energy is
critical to achieving many international development goals, specifically, the eradication of
poverty through continued improvements in education, health, and access to water.10 Oil
and natural gas play a central role in eliminating poverty and raising the standard of living
for millions by serving as a key form of abundant and affordable energy.
High energy density makes oil an invaluable resource to global society. According to the
Brookings Institute:
Oil resources are not as extensively distributed worldwide as coal, but oil has
crucial advantages. Fuels produced from oil are nearly ideal for transportation.
They are energy-dense, averaging twice the energy content of coal, by weight.
But more importantly, they are liquid rather than solid, allowing the development
of the internal combustion engine that drives transportation today…
The energy density of fossil fuels is particularly important in the transportation

sector. A vehicle needs to carry its fuel around as it travels, so the weight and
9. U.S. OIL AND NATURAL GAS: Providing Energy Security and Supporting Our Quality of Life, U.S. Department of Energy,
September 2020, p. 4.
10. https://unstats.un.org/sdgs/report/2016/goal-07/
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Oil in everyday life.
FURNITURE
VEHICLES
Garden furniture, sun loungers,
Gear oil, brake fluid, tires, fuels,
artificial fibers, parasols, carpet
car seats, bumpers, window
backing, rugs, upholstery,
seals, motorcycle helmets, boats,
curtains, pillows, lamps,
baby car seats, ambulances,
refrigerator linings, candles, toilet
helicopters, etc.
seats, etc.
HOUSEHOLD
Exterior paints, thermal isolation,
FUEL
heating oils, window frames,
Kerosene, heavy fuel oils, marine
kitchen surfaces, non-stick pans,
fuels, diesel, gasoline, jet fuel,
plastic surfaces, detergents, TV
heating oil, etc.
sets, dishwasher, faucet, trash
bags, mops etc.
MEDICAL CLOTHING
Pharmaceuticals, hoses, Outdoor clothing, clothing made
antiseptics, aspirin, hand out of polyethylene terephthalate
sanitiser, aesthetics, x-ray, (PET), artificial fiber, sweaters,
examination equipment, panty, rubber boots, running
pacemakers, crutches, shoes, shoe soles, shoe polish
wheelchair, bandages, etc. etc.
BEAUTY
ELECTRONICS Nail polish, make-up, facial
Cable coatings, computers, TV creams, perfumes, shampoo,
sets, tablets, headsets, cameras, soap, shaving cream, hair curlers,
mobile phones, photographic toothbrushes, toothpaste, hair
film, etc. coloring, deodorant, hairdryer,
etc.
AGRICULTURE
ACCESSORIES
Propane, lubricants, greases,
Sunglasses, carrier bags,
fungicides, fertilizers, pesticides,
synthetic leather, umbrellas,
herbicides, insecticides, irrigation
jewelry, luggage, etc.
piping, gloves, etc.
CONSTRUCTION SPORTS
Traffic cones, barrier tapes, Sports clothing, tennis balls,
asphalt, tarpaulins, paint, safety basketballs, footballs, surfboards,
glasses, water pipes, tools, safety cleats, bicycles, parachutes,
helmets, caulking, roofing roller-skate wheels, golf bags, golf
shingles, plywood adhesive, paint balls, helmets, lifesaving jackets,
rollers etc. fishing rods etc.
OFFICE TOYS
Printing inks, pens, computers, Pacifiers, frisbees, crayons,
glue, tape, etc. balloons, dolls, etc.
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volume of that fuel are key. Electric vehicles are a much-touted solution for
replacing oil, but they are not perfect for all uses. Pound for pound, gasoline
or diesel fuel contain about 40 times as much energy as a state-of-the-art
battery. On the other hand, electric motors are much more efficient than internal
combustion engines and electric vehicles are simpler mechanically, with many
fewer moving parts. These advantages make up for some of the battery’s
weight penalty, but an electric vehicle will still be heavier than a similar vehicle
running on fossil fuel. For vehicles that carry light loads and can refuel often, like
passenger cars, this penalty isn’t a big deal. But for aviation, maritime shipping,
or long-haul trucking, where the vehicle must carry heavy loads for long
distances without refueling, the difference in energy density between fossil fuels
and batteries is a huge challenge, and electric vehicles just don’t meet the need…
Industrial processes that need very high heat — such as the production of steel,
cement, and glass — pose another challenge. Steel blast furnaces operate at
about 1,100° C, and cement kilns operate at about 1,400° C. These very high
temperatures are hard to achieve without burning a fuel and are thus difficult to
power with electricity.11
The nascent offshore wind sector will be part of the energy transformation. Through
research, development, and demonstration projects, technology advances will enable
wind and other renewable energy sources to eventually provide pathways for overcoming
some of these challenges. While that inevitable progress is being made in the coming
decades, oil and natural gas will continue to account for a majority of our energy portfolio.
OIL AND NATURAL GAS ACCOUNT FOR A LARGE

SHARE OF U.S. AND GLOBAL ENERGY
According to the U.S. Energy Information Administration (EIA), oil and natural gas
accounted for 68 percent of total U.S. energy consumption in 2021 [FIGURE 1].
In its Annual Energy Outlook 2022, the EIA predicts, “U.S. energy consumption will
increase over the next 30 years as population and economic growth outpace gains in
energy efficiency.” 12 Though the organization projects that renewable energy will be the
fastest-growing source of energy through 2050 and will make up more of the energy
mix, it contends that petroleum and liquid fuels will remain the most-consumed source
of energy. In fact, liquid fuels are expected to represent the largest fuel source in the
global energy system [FIGURE 2].
11. https://www.brookings.edu/essay/why-are-fossil-fuels-so-hard-to-quit/
12. https://www.eia.gov/pressroom/releases/press496.php
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FIGURE 1
U.S. primary energy consumption by energy source, 2021
Total = 97.33 quadrillion Total = 12.13 quadrillion BTU
British Thermal Units (BTU)
Geothermal 2%
Nuclear Solar 12%
electric
power
8% Coal Hydroelectric 19%
11%
Petroleum
36%
Renewable
energy Wind 27%
12%
Biomass waste 4%
Natural gas
32% Biofuels 19%
40% Biomass
Wood 17%
Data source: U.S. Energy Information Administration, Monthly Energy Review, Table 1.3 and 10.1
April 2022, preliminary data
Note: Sum of components may not equal 100% because of independent rounding.
FIGURE 2
Energy production by source AEO2022 Reference case
quadrillion British thermal units
2021
50
history projections
dry natural gas
40
30
crude oil and lease condensate
20 other renewable energy
coal
10 natural gas plant liquids
nuclear
hydro
0
1990 2000 2010 2020 2030 2040 2050
Source: https://www.eia.gov/outlooks/aeo/pdf/AEO2022_ChartLibrary_OverviewandDrivers.pdf
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In its International Energy Outlook, released October 6, 2021, EIA projects renewable
energy consumption will more than double between 2020 and 2050 (reference case).
During the same period, natural gas consumption is expected to grow by 31 percent, but
the percentage of natural gas used by the global energy system will decline slightly.
As for oil, the forecast for liquid fuel consumption is continuing growth at a near
constant pace through 2050: “As travel increases as the effects of the COVID-19
pandemic lessen, the majority of passenger and freight vehicles continue to be fueled
by liquid fuel-consuming internal combustion engines. Industrial use of petroleum and
other liquids, particularly for chemical feedstocks, also increases through the projection
period.” 13 [FIGURE 3]
Renewables are gaining ground as the world pursues an energy transition away from oil
and natural gas, but hydrocarbons continue to play a central role in the U.S. and global
energy systems and will continue to do so for several decades.
Our national energy needs clearly support a commitment to continued U.S. offshore
energy development. U.S. Gulf of Mexico offshore energy production is a key component
of a national energy strategy that will ensure Americans can continue to have access to
fundamental domestic energy that is produced safely, sustainably, and responsibly.
OFFSHORE OIL AND GAS: CAPITAL INVESTMENT IN ACREAGE

AND EXPLORATION RESULTS IN PRODUCTION
As with many other forms of energy development, oil and gas production is contingent
upon having acreage that can be explored, developed, and produced. Leasing is requisite
to securing the acreage to develop and produce supplies of oil and gas for the country.
Continued lease sales at regular intervals is required for declining production to be
replenished and production levels to be increased when there are spikes in demand.
Simply put, the more acreage that is available, the greater the potential for well-managed
energy production.14
The myth of idle leases has become a red herring in the public debate over federal oil
and gas leasing. Assertions about the “stockpiling” of leases represents a fundamental
misunderstanding of how the oil and gas industry operates under the offshore
leasing program.
13. https://www.eia.gov/outlooks/ieo/consumption/sub-topic-01.php
14. It is not true, however, that more leasing necessarily leads to more environmental impacts. As noted herein, many leases will
not go into production, and for those that do, industry has continued to minimize the footprint necessary for production as it
continues to do more with less.
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FIGURE 3
Primary energy consumption Share of primary energy consumption by
by energy source, world energy source, world
quadrillion British thermal units percentage
history projections
petroleum 100%
300 history projections
and other 90% renewables
250 liquids1
80%
renewables
70%
200 natural gas coal
60%
coal
150 50%
petroleum
40% and other
100 liquids1
30%
50 20%
nuclear natural gas
10%
0
0%
nuclear
2010 2020 2030 2040 2050
2020 2050
Source: U. S. Energy Information Administration, International Energy Outlook 2021 (IEO2021) Reference case
1
includes biofuels
Oil and gas companies often must bid on leases around which there is significant
uncertainty. In other words, companies must cast a wide net when acquiring lease
blocks, then winnow through prospective blocks by means of additional exploration
and study – a process that can take years – before they can identify a commercially
viable discovery.
Legally competing at auction for rights to explore and develop offshore federal lands
and paying a bonus to acquire a federal offshore oil and gas mineral lease can be a
risky proposition. There is no guarantee that oil and gas resources are present in the
subsurface. Even with incredible advances in technology, there is an element of energy
production that is still speculative. Due to this risk, some leases are studied for quite
some time to determine if energy reserves exist or if they exist in sufficient quantities to
be produced economically and in compliance with regulatory standards. In other cases,
sites being considered for exploratory wells are going through a thorough and lengthy
regulatory approval process.
Given that a production well in the Gulf of Mexico can cost hundreds of millions of
dollars to develop, decision-makers must be judicious in deciding to develop a lease.
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This means some leases expire and are returned to the federal government for future
consideration when technology improves enough to make resources accessible.
As the non-partisan federal Congressional Research Service concluded during the

Obama Administration:
Many leases expire before exploration or production occurs…Generally, a

number of concerns arise in the oil and gas leasing process that delay or prevent
oil and gas development from taking place, or might account for the large
number of leases held in non-producing status. There could be a lack of drilling
rigs or other equipment availability, and financing and/or skilled labor shortages.
Legal challenges might delay or prevent development. There are typically also
many leases in the development cycle (e.g., conducting environmental reviews,
permitting, or exploring) but not producing commercial quantities.15
Oil and natural gas companies have every incentive to produce as much oil and gas
as possible as rapidly as they can. The decision about which blocks to develop is
predicated on a number of considerations.
■ Finding oil and gas is a prospective business, and not all leases contain commercially
viable amounts of hydrocarbons. In fact, most leased areas do not contain oil and
gas in commercial quantities. Companies need to invest in multiple lease blocks and
methodically assess them to identify and develop the blocks where commercially
viable finds are most likely.
■ A lease is only a rental agreement. When a company buys a lease, it’s tying up
significant (and finite) capital in the search for oil and natural gas. There is a
significant financial incentive for a company to recover its initial investment
by developing oil and gas resources in a timely manner, in other words, to
initiate production.
■ In addition to bidding potentially millions of dollars for each lease block, companies
pay rent to the federal government on non-producing leases. Annual rental rates can
cost hundreds of thousands of dollars per lease block.
■ Companies are required under government leasing regulations to develop a lease
expeditiously or return it to the federal government. Rental terms are established
in the Final Notice of Sale and typically range from 5 to 10 years, depending on
water depth. In general, leases that are not producing by the end of their term are
relinquished to the government, which can then re-lease them. The resources
invested by the company to acquire and keep the lease are lost if a lease is returned
to the government.
15. https://crsreports.congress.gov/product/pdf/R/R40645
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It takes time and significant investments to explore and develop an offshore lease
block. Capital costs for offshore exploration and development are significant, with total
costs for projects regularly going into the billions of dollars.
■ Offshore seismic exploration can cost upwards of $200,000 per day.

■ Offshore exploratory wells can cost anywhere from $25 million to more than $100
million for some deepwater prospects. It is not unusual for a company to spend more
than $100 million on an exploratory well only to come up empty with a “dry hole.”
■ If a company does end up identifying commercial quantities of oil or natural gas,
the subsequent design and installation of deepwater production facilities regularly
exceeds $1 billion.
Developing a lease block does not occur overnight. The timeline from lease sale to first
oil can take up to ten years. A typical project progression includes:
■ One year for preliminary geological investigation and selection of areas of interest for
seismic data acquisition.
■ One year to two years to acquire and process seismic data and identify
drillable prospects.
■ A year or more to contract and schedule a drilling rig to carry out a drilling program.
■ Six to 10 months to drill and complete an exploratory well.
■ Six months to a year for follow-up evaluation of drilling results, which can include
drilling a sidetrack well.
■ Another two to three years for additional delineation drilling, and formulating a
reservoir development plan if the exploratory well proves successful. During this
time, the company also is working on pre-permit studies, permitting, and design and
procurement for production facilities, including surface and subsurface equipment
and systems,
■ One year or more is needed for facilities installation, followed by development drilling,
which can take one to two additional years. During this period, the company is
involved in design, permitting, engineering, procurement and installation of a pipeline
or offshore system to bring production to market.
THE CONTINUOUSLY IMPROVING EFFICIENCY OF

U.S. GULF OF MEXICO OFFSHORE DEVELOPMENT
Gulf of Mexico oil and gas companies are producing a massive amount of energy with a
small – and shrinking – physical footprint.
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Gulf of Mexico Oil and Gas Lease Information
Number Acreage
Number of Acreage of of Non- of Non-
Number of Acreage of Producing Producing producing producing Average Daily
Active Leases Active Leases Leases Leases Leases Leases Production
December
2,018 10,773,137 540 2,766,936 1,478 8,006,201 1.73 mbpd
2021
December
3,257 17,331,283 873 4,301,193 2,381 13,030,090 1.73 mbpd
2016
December
5,873 31,576,909 1,244 6,065,566 4,629 25,511,343 1.25 mbpd
2011
Source: BOEM, EIA (As of March 2022, there are 1,997 active leases, with 479 producing leases, 1,518 non-producing leases in the Gulf of Mexico.)
Leasing data demonstrates that the industry is innovating and advancing technologies
to do more with less. Over the 10-year period from 2011, the industry increased oil
production in the Gulf of Mexico by 38 percent while the number of producing leases
decreased by 57 percent. This is an impressive achievement, but access to resources
remains key to continued progress in provide the energy supplies relied upon by
Americans. Continued offshore lease sales are absolutely imperative because it is only
through a robust leasing program with biannual opportunities to secure leases that
companies are able to find and develop the most prospective targets. In the U.S. Gulf of
Mexico, the industry continues to innovate and develop the systems to produce more
resources with an ever decreasing footprint. The preference for all stakeholders should
be to enable consistent lease sales that allow steady and predictable development and
production from this strategic region.
THE GULF OF MEXICO IS POISED FOR CONTINUED

GLOBAL ENERGY LEADERSHIP
According to Rystad Energy, global oil exploration activities must ramp up to meet
global demand through 2050. More than $3 trillion in capital expenditure will be
needed to add the undeveloped and undiscovered resources necessary for the global
market. Rystad analysts expect deepwater areas to play a prominent role in building
essential energy supplies. According to Rystad Senior Upstream Analyst Palzor Shenga,
“Upstream players may have to more than double their conventional exploration efforts
in order to meet global oil demand through 2050.” [FIGURE 4]
The implications of what happens when oil production cannot meet oil demand
surfaced as the world emerged from pandemic lockdowns. The year 2021 saw a strong
economic recovery – domestically and globally – as some degree of normalcy resumed.
Oil consumption grew by a very strong 6.1 percent in 2021, but it takes time, capital, and
2305CP_NOIA.indd 20 4/28/23 6:08 PM

FIGURE 4
Total new liquids supply required to meet demand towards 2050
Billion barrels (bb)
SOURCE 1 SOURCE 2 (Remaining volumes to satisfy demand)

Total recoverable volumes
Risked volumes
Yet-to-be-found resources
Total liquids
74 volumes needed
378 bb
30%
bb
Resource
+ 121
bb
484
bb
increment via
1. Appraisal
2. Technological
enhancements 47 70%
3. EOR, etc. bb
18 Remaining after Conventional

bb contribution from Unconventional
Source 1
5% resource increment Source: Rystad Energy UCube, research and analysis
Source: Rystad Energy UCube, research and analysis, as reported in Offshore Magazine, “Exploration overdrive urgently required, report claims,”
December 10, 2020.16
entire teams of experts to ramp up production safely and responsibly, and producers
could not immediately meet the demand.
Oil production grew by a “tepid” 1.5% with prices jumping sharply as demand outpaced
supply 17. Brent crude oil, a global benchmark, started the year at $50 per barrel and
increased to a high of $86 per barrel in late October before declining in the final weeks
of the year 18 . The trend continued in 2022, with $98 per barrel forecasted in the fourth
quarter of 2022 and $97 per barrel forecasted in the first quarter of 202319. A recurring
16. https://www.offshore-mag.com/drilling-completion/article/14188804/exploration-overdrive-urgently-required-rystad-
energy-report-claims
17. https://www.forbes.com/sites/thebakersinstitute/2022/08/23/oil-is-the-outlier-in-the-worlds-post-covid-energy-
recovery/?sh=4b3f9605e840
18. https://www.eia.gov/todayinenergy/detail.php?id=50738
19. https://www.eia.gov/outlooks/steo/report/prices.php#:~:text=The%20Brent%20crude%20oil%20spot,and%20
%2497%2Fb%20in%202023.
2305CP_NOIA.indd 21 4/28/23 6:08 PM

trend of similarly painful price shocks can be reasonably expected if global oil markets
are not able to invest in new projects to keep energy flowing.
The U.S. Gulf of Mexico has been a steady and reliable source of oil production over
the past several decades and achieved a leadership position globally for deepwater
development, maintaining production at more than one million barrels of oil per day
since 1997. The United States must sustain production from this region if the country is
to meet domestic demand.
Analysts at Energy & Industry Advisory Partners (EIAP) published a study titled The
Economic Impacts of a 5-Year Leasing Program Delay for the Gulf of Mexico Oil and
Natural Gas Industry that looks at the drop in production from the Gulf of Mexico if
lease sales are disrupted20. An uninterrupted leasing program in the Gulf of Mexico
would produce an average of 2.6 million barrels equivalent of oil and natural gas per
day from 2022-2040. Eliminating lease sales would result in about 500,000 barrels
equivalent per day less over that period, amounting to approximately 3.3 billion barrels
equivalent of lost production.
The following table shows the anticipated loss in oil and natural gas production with no
lease sales in the program:
2016 2017 2018 2019 2020 2021 2022
Oil (Delayed 5-year

1,598,583 1,680,500 1,757,167 1,892,167 1,644,083 1,696,200 1,770,904
Leasing Program Case)
Oil (Base Case) 1,598,583 1,680,500 1,757,167 1,892,167 1,644,083 1,696,200 1,770,904
Natural Gas (Delayed

5-year Leasing 548,251 484,225 445,142 463,627 360,395 349,089 364,464
Program Case)
Natural Gas (Base

548,251 484,225 445,142 463,627 360,395 349,089 364,464
Case)
Total BOE (Delayed

5-year Leasing 2,146,834 2,164,725 2,202,309 2,355,794 2,004,478 2,045,289 2,135,368
Program Case)
Total BOE (Base Case) 2,146,834 2,164,725 2,202,309 2,355,794 2,004,478 2,045,289 2,135,368
Offshore leasing has a clear and profound impact on U.S. oil and natural gas supplies.
Under the base case, with continued unabated Gulf of Mexico leasing, offshore oil
production from the Gulf is projected to increase to a high mark of 2,443,896 barrels
per day in 2032 and is expected to be near current levels, 1,779,534 barrels per day
projected, in 2040. If there are no lease sales in the program, offshore production from
the Gulf is expected to be 1,791,263 barrels per day in 2032, a drop of more than 600,000
barrel per day from the base case. A delayed leasing program results in 1,320,109
20. https://www.noia.org/noia-one-pagers-infographics/#flipbook-df_223664/1/
2305CP_NOIA.indd 22 4/28/23 6:08 PM

2023 2024 2025 2026 2027 2028
Oil (Delayed 5-year Leasing

1,862,644 2,045,883 2,104,153 2,125,785 2,131,351 2,104,996
Program Case)
Oil (Base Case) 1,862,644 2,045,883 2,109,445 2,157,480 2,194,981 2,256,299
Natural Gas (Delayed 5-year

379,846 411,896 422,762 427,058 428,169 422,875
Natural Gas (Base Case) 379,846 411,896 423,869 435,216 443,651 454,074
Total BOE (Delayed 5-year

2,242,490 2,457,779 2,526,915 2,552,844 2,559,520 2,527,871
Total BOE (Base Case) 2,242,490 2,457,779 2,533,314 2,592,696 2,638,632 2,710,373
2029 2030 2031 2032 2033 2034

2,044,281 1,940,296 1,873,776 1,791,263 1,743,126 1,673,276
Program Case)
Oil (Base Case) 2,271,322 2,342,453 2,402,462 2,443,896 2,407,104 2,344,299

410,677 389,788 376,425 359,849 350,178 336,146

2,454,958 2,330,084 2,250,200 2,151,111 2,093,304 2,009,422
2035 2036 2037 2038 2039 2040

1,620,909 1,522,137 1,447,031 1,346,578 1,332,971 1,320,109
Program Case)
Oil (Base Case) 2,276,146 2,187,721 2,062,724 1,930,878 1,849,058 1,779,534

325,626 305,784 290,695 270,515 267,782 265,198

1,946,535 1,827,921 1,737,726 1,617,094 1,600,752 1,585,307
Source: Energy and Industrial Advisory Partners
barrels per day of production in 2040, a drop of more than 400,000 barrel per day from
the base case.
According to the EIAP study, “A key requirement for continued Gulf of Mexico oil and
natural gas production is continued lease sales, which enable operators to explore new
acreage for previously undiscovered resources, develop new projects, and underpin
2305CP_NOIA.indd 23 4/28/23 6:08 PM

FIGURE 5
Global crude oil production, 2005-15
million barrels per day
100
80
60
68% 69% 71% onshore
40
20
32% 31% 29% offshore
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
FIGURE 6
Off-trend production due to

abnormal hurricane seasons
Source: U.S. Outer Continental Shelf Gulf of Mexico Region: Oil and Gas Production Forecast 2022-2031, OCS
Report BOEM 2022-022, page 23. Figure 14: OCS, GOMR Annual Oil Forecast
Table 3 below shows the oil forecast in tabular form.
Table 3: Annual Oil Forecast by Forecast Component (thousands of barrels of oil per day)
Contingent Undiscovered
Year Reserves Total Forecast
Resources Resources
2022 1,540 350 2 1,892
2023 1,363 575 62 2,000
2024 1,200 728 86 2,013
2305CP_NOIA.indd 24 2025 1,061 842 149 2,052 4/28/23 6:08 PM
existing and planned projects by allowing operators to backfill production into facilities
with declining production.”21
The offshore region more generally is recognized as a preferred global region for
offshore oil and natural gas investment. Historically, offshore production has accounted
for about thirty percent of total oil production globally [FIGURE 5]. The BOEM’s own
estimates for the Gulf of Mexico demonstrate continued high levels of oil production
for the region and also assume that federal leasing for offshore tracts continues for the
forecast period [FIGURE 6]. The U.S. has been producing oil in the federal Gulf of Mexico
waters since the 1940s and production from the Gulf has been steadily increasing over
the past 30 years. In fact, this region has been producing more than one million barrels
of oil per day since 1997 and hit its highest level of production on record of 2.044 million
barrels per day in August of 2019, just before the onset of the pandemic [FIGURE 7].
21. https://www.noia.org/noia-one-pagers-infographics/#flipbook-df_223664/1/, at page 3.
FIGURE 7
Federal Offshore — Gulf of Mexico Field Production of Crude Oil
Thousand barrels per day

2,500
2,000
1,500
1,000
500
0
1985 1990 1995 2000 2005 2010 2015 2020
Federal Offshore — Gulf of Mexico Field Production of Crude Oil
Source: U.S. Energy Information Administration
2305CP_NOIA.indd 25 4/28/23 6:08 PM

Although production dropped during the pandemic in response to the related global
economic downturn, the U.S. Gulf of Mexico has recovered and was at 1.8 million barrels
per day in November 2022.
Oil is a global commodity, and investment in oil production projects occurs on a

global scale. The U.S. Gulf of Mexico shines as a premier region for oil production, with
substantial benefits flowing to American consumers. Eliminating or reducing U.S. oil and
gas leasing opportunities will shift that investment away from the U.S. Gulf of Mexico
to other regions, both offshore and onshore, throughout the world. As the chart below
shows, the U.S. stands out as a global leader in offshore oil production [FIGURE 8].
The U.S. Gulf of Mexico ranked second in the world based on the volume of new
discoveries of oil from 2015-2019 (shown in billions of barrels) as reported by Rystad
Energy in November 201922 .
Following increased investment and additional discoveries offshore Guyana, the most
recent Rystad Energy estimate places Guyana discoveries since 2015 at more than 11
billion barrels.23
This number tells an important story. The oil and natural gas industry continues to
invest in offshore projects around the world because the hydrocarbons produced
offshore have clear and positive economic, environmental, and climate attributes
compared to other regions.
Offshore oil and gas development is recognized for providing among the lowest carbon
barrels of oil in the world, and the U.S. Gulf of Mexico stands out as a global leader.
In the interest of reducing the carbon intensity of oil and gas development globally
and boosting energy security, the U.S. oil and gas policy should proactively attract
investment to the U.S. Gulf of Mexico.
22. https://guyanapetroleumdigest.ca/2019/11/26/guyana-still-leads-world-offshore-oil-discoveries-since-2015-2019-with-
6-8-billion-barrels/
23. https://www.forbes.com/sites/davidblackmon/2022/07/28/new-oil-power-guyana-on-pace-to-surpass-us-offshore-by-
2035/?sh=59eb17cc6c06
2305CP_NOIA.indd 26 4/28/23 6:08 PM

FIGURE 8
Global offshore crude oil production, 2005-15
million barrels per day
30
25
20
rest of world
15
United States
10
Norway
Mexico
5 Brazil
Saudi Arabia
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Source: U.S. Energy Information Adimistration, based on Rystad Energy

Note: Includes lease condensate and hydrocarbon gas liquids.
BOEM recognizes a promising future for oil development in the Gulf of Mexico.
According to the 2021 Assessment of Technically and Economically Recoverable Oil
and Natural Gas Resources of the Gulf of Mexico Outer Continental Shelf24 , the region
contains estimated undiscovered technically recoverable resources in the range of
23.31 billion barrels of oil to 36.27 billion barrels of oil. We know from experience that
technology advancements will continue to enable the discovery and development
of ever-increasing volumes, resulting in a continuous upward trend over time in the
estimated undiscovered technical recoverable resources in the Gulf of Mexico.
These estimates mean nothing, however, if companies do not have the opportunity to
continue to lease acreage for development through regular, formalized lease sales. It
is critical that the U.S. does not cede ground in offshore energy production to other
regions and that it recognizes that it is in the best interests of Americans for public
policy to encourage and attract investment to U.S. offshore production opportunities.
24. https://www.boem.gov/sites/default/files/documents/regions/gulf-mexico-ocs-region/resource-evaluation/2021%20
Gulf%20of%20Mexico%20Oil%20and%20Gas%20Resource%20Assessment%20%28BOEM%202021-082%29.pdf
2305CP_NOIA.indd 27 4/28/23 6:08 PM

■ GULF OF MEXICO PRODUCTION
IMPROVES ENERGY AFFORDABILITY
The cost of energy is fundamentally driven by supply and demand, and recently, global
markets have been disrupted by a supply crunch in both the oil and natural gas markets.
The energy paradigm has shifted over the past decade, with the United States rising to
a position of energy power and emerging as the leading producer of both oil and natural
gas in the world.
Vice Chairman of IHS Markit Daniel Yergin explains how things have changed:
According to the old script, United States oil production was too marginal to
affect world oil prices. But the gap today between demand and available supply
on the world market is narrow. The additional oil Saudi Arabia is putting into the
market will help replace Iranian exports as they are increasingly squeezed out
of the market by sanctions…. But if America’s increase … [in oil production] …
had not occurred, then the world oil market would be even tighter. We would be
looking at much higher prices – and voters would be even angrier.25
Mr. Yergin made this point in 2012 at the outset of the shale revolution, but the
significance of U.S. production for global energy markets is as important as ever today.
In fact, Mr. Yergin reiterated this very point in February 2022 in the aptly title op-ed in
the Wall Street Journal, “America Takes Pole Position on Oil and Gas.”
Analysts recognize that the downturn in the oil and natural gas industry from 2014-2020,
combined with ill-conceived policies and investment approaches, led to significant
underinvestment in oil and natural gas exploration and infrastructure. According to
Simon Flowers, Chairman, Chief Analyst at Wood Mackenzie and author of a weekly
column called The Edge, “Underinvestment in oil supply will lead to a tight oil market later
this decade. It’s a narrative that’s gained increasing traction as capital expenditure on
upstream oil and gas has shrunk. Spend in 2021 is half the peak of 2014 after slumping to
new depths in [2021’s] crisis.”26
Mr. Flowers poses the question, “How much new oil supply does the world need?” His
answer is, “A lot–we reckon about 20 million b/d from 2022 to 2030.”
According to Flowers, “This is the ‘supply gap’, the difference between our estimate
of demand in 2030 and the volumes we forecast existing fields already onstream or
under development can deliver.”27 If his numbers are correct, a huge amount of new oil
25. Daniel Yergin, “America’s New Energy Reality,” The New York Times, June 9, 2012
26. https://www.woodmac.com/news/the-edge/is-the-world-sleepwalking-into-an-oil-supply-crunch/
27. https://www.woodmac.com/news/the-edge/is-the-world-sleepwalking-into-an-oil-supply-crunch/
2305CP_NOIA.indd 28 4/28/23 6:08 PM

THE COST OF ENERGY IS
FUNDAMENTALLY DRIVEN
BY SUPPLY AND DEMAND,
AND RECENTLY, GLOBAL MARKETS
HAVE BEEN DISRUPTED BY A
SUPPLY CRUNCH IN BOTH THE
OIL AND NATURAL GAS MARKETS.
is needed to close the expected gap between the supply and demand and help bring
stability and affordability to oil and petroleum product prices.
Rystad Energy echoes the concern about the supply gap and the huge amount of
investment needed to close it. According to Rystad, more exploration for oil and
gas is needed to supply the volumes needed worldwide by 2050.28 In fact, it will take
massive investment just to keep pace with growing demand. Rystad suggests capital
expenditures of at least $3 trillion will be required to replenish declining production from
currently producing assets around the world to meet expected global demand in 2050.
Saudi Aramco CEO Amin H. Nasser identified the crux of the issue with the energy crisis in
his remarks during the Schlumberger Digital Forum, on September 20, 2022:
Unfortunately, the response so far betrays a deep misunderstanding of how we

got here in the first place, and therefore little hope of ending the crisis anytime
soon. So this morning I would like to focus on the real causes as they shine a
bright light on a much more credible way forward.
When historians reflect on this crisis, they will see that the warning signs in
global energy policies were flashing red for almost a decade. Many of us have
been insisting for years that if investments in oil and gas continued to fall,
28. https://www.offshore-mag.com/drilling-completion/article/14188804/exploration-overdrive-urgently-required-rystad-
energy-report-claims
2305CP_NOIA.indd 29 4/28/23 6:08 PM

global supply growth would lag behind demand, impacting markets, the global
economy, and people’s lives.
In fact, oil and gas investments crashed by more than 50% between 2014 and
last year, from $700 billion to a little over $300 billion. The increases this year are
too little, too late, too short-term.
Meanwhile, the energy transition plan has been undermined by unrealistic

scenarios and flawed assumptions because they have been mistakenly
perceived as facts. For example, one scenario led many to assume that major
oil use sectors would switch to alternatives almost overnight, and therefore oil
demand would never return to pre-Covid levels.
In reality, once the global economy started to emerge from lockdowns, oil
demand came surging back, and so did gas.29
Mr. Nasser’s remarks about the challenges ahead are similarly profound, “Oil inventories
are low, and effective global spare capacity is now about one and a half percent of
global demand. Equally concerning is that oil fields around the world are declining on
average at about 6% each year, and more than 20% in some older fields last year. At
these levels, simply keeping production steady needs a lot of capital in its own right,
while increasing capacity requires a lot more.”30
We are fortunate in the United States that our Gulf of Mexico region is up to the task of
delivering the oil and gas the economy needs. Production numbers from the U.S. Gulf
of Mexico place it in the company of some of the largest oil producing countries. If the
Gulf of Mexico were its own country, it would be one of the top eleven oil producing
countries [FIGURE 9].
The U.S. offshore oil producing basin can help address the current and projected
gap between global supply and demand. Bringing to market oil from this region will
help exert downward pressure on the price of oil and petroleum products such as
gasoline, which has become a more costly necessity for American consumers as well
as businesses.
Offshore projects around the world contribute massive amounts of natural gas to global
production volumes, and prolific areas like the U.S. Gulf of Mexico can help address
issues surrounding the tightening in global natural gas supplies, which has led to record
high prices in various regions. Although natural gas production from the U.S. offshore
has hovered around two billion cubic feet (bcf) per day, Gulf of Mexico production in the
late 1990s exceeded 5 bcf per day, and there is significant potential for growth. Today,
29. https://www.aramco.com/en/news-media/speeches/2022/remarks-by-amin-h-nasser-at-schlumberger-digital-forum#
30. https://www.aramco.com/en/news-media/speeches/2022/remarks-by-amin-h-nasser-at-schlumberger-digital-forum#
2305CP_NOIA.indd 30 4/28/23 6:08 PM

FIGURE 9
The U.S. Gulf of Mexico stands out as one of

the leading oil producing regions of the world
Country Barrels of oil per day
United States 11,184,870
Russia 10,111,830
Saudi Arabia (OPEC) 9,313,145
Canada 4,459,455
Iraq (OPEC) 4,084,822
China 3,987,677
Iran (OPEC) 3,110,275
United Arab Emirates (OPEC) 3,091,481
Brazil 2,905,121
Kuwait (OPEC) 2,527,106
U.S. Gulf of Mexico (pre-pandemic peak) 2,044,000
U.S. Gulf of Mexico (current levels) 1,791,000*
Norway 1,775,813
Kazakhstan 1,764,463
Mexico 1,734,495
*as of June 2022
Source: U.S. Energy Information Administration.
the United States is a leading exporter of LNG at a time when demand for U.S. LNG is
growing from our allies around the world31. If the United States were to invest in more
offshore development, natural gas production from the U.S. Gulf of Mexico could feed
31. https://www.reuters.com/markets/commodities/firms-make-deals-boost-lng-exports-60-us-canada-
mexico-2022-08-23/
2305CP_NOIA.indd 31 4/28/23 6:08 PM

into the domestic or LNG market, helping to bring down the cost and provide secure
energy to our allies.
Expanding natural gas production and usage provides environmental benefits as well.
For example, replacing coal with natural gas in power generation significantly reduces
emissions. According to Fatih Birol, Executive Director of the International Energy
Agency (IEA), “Natural gas is one of the mainstays of global energy. Where it replaces
more polluting fuels, it improves air quality and limits emissions of carbon dioxide.”32
Burning natural gas for power generation produces about half as much carbon dioxide
as coal to produce the same amount of energy.
The U.S. Energy Information Administration (EIA) explains the differences:
CO2 emissions associated with generating electricity from coal and natural gas
differ because of differences in the fuels themselves—coal has more carbon
content per unit of energy. In addition, coal-fired plants and natural gas-fired
plants differ in how efficiently they convert their respective fuels to electricity.
The amount of CO2 produced when a fuel is burned depends on a fuel’s carbon
content. Coal produces more CO2 per unit of energy than natural gas does when
burned. Coal consumption for electricity generation produces 209 pounds of
CO2 per million British thermal units (MMBtu), compared with 117 pounds of CO2 /
MMBtu for natural gas.33
According to the EIA, the shift from coal to natural gas in U.S. power generation has had
profound positive emissions benefits for the U.S., catapulting the U.S. to leadership in
GHG emissions reductions around the world. “Over the past 15 years, the U.S. electricity
generation mix has shifted away from coal and toward natural gas and renewables,
resulting in lower CO2 emissions from electricity generation. In 2019, the U.S. electric
power sector produced 1,724 million metric tons (MMmt) of CO2, 32% less than the
2,544 MMmt produced in 2005.”34
The following EIA graphic shows the impactful decline in emissions attributable to the
rise in natural gas production and use in the United States [FIGURE 10].
The global economy has experienced similar emissions reductions as a result of

switching from coal to natural gas. The drop in emissions from 2010 to 2018 is evident in
data reported by IEA35 [FIGURE 11].
32. https://www.iea.org/reports/the-role-of-gas-in-todays-energy-transitions
33. “Electric power sector CO2 emissions drop as generation mix shifts from coal to natural gas,” This Week in Energy, U.S.
Energy Information Administration, June 9, 2021.
34. “Electric power sector CO2 emissions drop as generation mix shifts from coal to natural gas,” This Week in Energy, U.S.
Energy Information Administration, June 9, 2021.
35. https://www.iea.org/reports/the-role-of-gas-in-todays-energy-transitions (Reprinted from IEA)
2305CP_NOIA.indd 32 4/28/23 6:08 PM

FIGURE 10
U.S. electric power sector electricity generation and CO2 emissions by source (2005–201 9)
electricity generation CO2 emissions
billion megawatthours million metric tons
4.5 3,000
4.0
renewables
3.5
nuclear
3.0 2,000
2.5
2.0 coal
coal
1 .5 1 ,000
1 .0
natural gas
0.5 natural gas
all other all other
0.0 0
2005 201 9 2005 201 9
FIGURE 11
CO2 savings from coal-to-gas switching in selected regions compared with 2010, 2018
Mt CO2
0
-100
-200
-300
-400
-500
-600
2011 2012 2013 2014 2015 2016 2017 2018
United States China Europe India Rest of world
2305CP_NOIA.indd 33 4/28/23 6:08 PM

Switching from coal to natural gas has serious health benefits as well. According to
Harvard’s Jackson Salovaara:
[N]atural gas is superior to coal in a number of respects other than CO2

emissions. Natural gas burns much more cleanly than coal, only emitting
NOx and methane in significant quantities when combusted. By comparison,
coal combustion emits NOx and methane at higher rates than natural gas
and also emits SO2 [sulfur dioxide], mercury, particulate matter, CO, and toxic
metals. These air pollutants have dangerous impacts on human health—SO2,
particulate matter, and CO are damaging to the respiratory system and mercury
consumption can cause birth defects and lower IQ.36
Unfortunately, the current energy crisis and the energy challenges associated with
Russia’s invasion of Ukraine have pushed countries to revert to coal power generation,
and in some regions, the move has been substantial. In June 2022, The Washington
Post reported that several European countries were in the process of making the
switch, “Austria, Germany, Italy and the Netherlands announced plans this week to
prepare to resurrect old coal plants as gas supplies dwindled. The moves came just days
after Moscow reduced natural gas flows to several European countries, including Italy
and Slovakia, alarming leaders who are worried about energy reserves ahead of winter.”37
Reuters has confirmed there is now a rush for coal supplies from European buyers to
secure the energy needed ahead of the coming winter,
Prices for thermal coal, used to generate electricity, have leapt to record levels
as a result of the war, which has led to many European countries losing access
to vital supplies of natural gas and coal from their top provider Russia. Buyers in
Europe and beyond are now vying to pay top dollar for coal from often remote
mines in places such as Tanzania, Botswana and even potentially Madagascar.
The resurgent coal demand, driven by governments trying to wean themselves
off Russian energy while keeping a lid on power prices, clashes with climate plans
to shift away from the most polluting fossil fuel.38
And Nasdaq has reported that European imports of coal are expected to hit some
of the highest levels in years, “European imports of thermal coal could be the
highest in at least four years in 2022 and may rise further next year, analysts said on
Monday, highlighting the extent of the energy crisis resulting from sanctions on top
supplier Russia.”39
36. Salovaara, “Coal to Natural Gas Fuel Switching and CO2 Emissions Reduction,” Harvard College, 2011, at pages 87-88.
37. https://www.washingtonpost.com/world/2022/06/22/coal-plant-europe-germany-austria-netherlands-russia-gas/
38. https://www.reuters.com/markets/commodities/coal-rush-energy-crisis-fires-global-hunt-polluting-fuel-2022-09-20/
39. https://www.nasdaq.com/articles/going-back-in-time:-europes-coal-imports-to-hit-multi-year-highs-in-2022
2305CP_NOIA.indd 34 4/28/23 6:08 PM

The recent switch back to coal for power generation comes on top of continued
construction of new coal-fired power plants around world, particularly in China and
India. A report from the Wilson Center highlights the continued role of coal in the
Chinese economy:
In 2021, China began building 33 gigawatts of coal-based power generation,

according to the Helsinki-based Center for Research on Energy and Clean
Air (CREA). That is the most new coal-fired power capacity China has
undertaken since 2016 and, says CREA, three times more than the rest of the
world combined…. India gets roughly 70% of its electricity from coal, and the
Modi government recently ordered the reopening of more than 100 closed
mines to meet rapidly growing demand made even greater by the country’s
crushing heat wave.40
Although other countries are exerting pressure on China and India to reduce emissions,
it is clear that the global economy will continue to rely on supplies of energy that are
affordable and reliable even if they are not the best choices for the environment. An
“all of the above” approach considers both traditional fuels and renewables to provide
the energy necessary for the fundamentals of life. Growth in renewable energy and
offshore wind will be strong for years to come, and natural gas will play an important and
expanding role, filling the gap as a much cleaner alternative to coal. Gas production from
the U.S. Gulf of Mexico has great potential to help keep energy costs affordable and
support U.S. allies around the globe.
High energy prices impact all Americans, but they disproportionately impact low income
and minority communities in which many must decide between food, healthcare, or
energy bills. In a different way, businesses that rely on affordable and reliable supplies
of energy suffer as well. Today, manufacturers in Europe are laying off employees and
shutting down factories in direct response to high prices of natural gas and electricity.41
Policies that promote U.S. Gulf of Mexico oil and natural gas production promote
important principles of economic justice by helping those in need with greater energy
affordability and jobs, and help fuel the businesses and factories upon which the world
economy relies.
40. https://www.wilsoncenter.org/blog-post/chinese-coal-based-power-plants
41. https://www.nytimes.com/2022/09/19/business/europe-energy-crisis-factories.html
2305CP_NOIA.indd 35 4/28/23 6:08 PM

■ GULF OF MEXICO ENERGY DEVELOPMENT
STIMULATES DOMESTIC SPENDING
Offshore oil and gas development is capital intensive. In 2021, an EIAP study titled The
Gulf of Mexico Oil & Gas Project Lifecyle: Building an American Energy & Economic
Anchor places the total lifetime spend to develop and produce a deepwater Gulf of
Mexico at approximately $8.8 billion. The average annual spend is nearly $295 million,
with the highest spending levels taking place during project development, when
subsea tieback development is taking place, and during decommissioning. The average
shallow-water project results in an estimated $1.3 billion total lifetime spending,
including $27.5 million in annual operational expenditures.42
In another EIAP study, The Economic Impacts of a 5-Year Leasing Program Delay for
the Gulf of Mexico Oil and Natural Gas Industry,43 released in 2022, analysts projected
Gulf of Mexico offshore oil and gas spending for 2022 would be approximately $30.3
billion. Across the forecast period from 2022-2040, EIAP estimates Gulf of Mexico the
offshore oil and natural gas industry will spend $30.6 billion per year. This investment
projection assumes there will be no interruption in Gulf of Mexico oil and gas
lease sales.
However, the study shows that lease sale delays serves to dramatically reduce
projected domestic investment. According to the 2022 study, an extensive delay in
federal offshore leasing (or zero lease sales) could result in a drop in capital expenditure
of about $10 billion in the peak year and a nearly $100 billion capital spending loss over
the forecast period.
The study provides a high degree of granularity, identifying the specific types of
spending that take place throughout the lease life cycle. The table below shows the
breakdown in spending for a multitude of areas of offshore oil and gas development for
2021 and 2022:
42. https://www.noia.org/noia-reports/#flipbook-df_218475/1/
2305CP_NOIA.indd 36 4/28/23 6:08 PM

2021 2022
G&G $192 $236
Drilling Tangibles $863 $1,224
Trees $506 $558
Manifolds $261 $290
Other Subsea Hardware $90 $135
Control Umbilical, Flying Leads $308 $354
Infield FL $68 $119
Export PL $358 $734
Infield Risers $33 $57
Export Risers $14 $29
Fixed Platforms & Facilities $88 $168
Floating Production Units & Facilities $1,760 $1,870
Installation $1,038 $1,636
OPEX $13,474 $13,548
Decommissioning CAPEX $858 $785
Drilling $4,882 $6,790
Engineering CAPEX $679 $847
Engineering OPEX $886 $891
Natural Gas Processing and Transportation $124 $127
Total $26,359 $30,272
Source: Energy & Industrial Advisory Partners, The Economic Impacts of a 5-Year Leasing Program Delay for
the Gulf of Mexico Oil and Natural Gas Industry, March 29, 2022. page 59.44
Thousands of companies support offshore Gulf of Mexico oil and gas development.
While the bulk of the work and a significant portion of the spending occur along the Gulf
Coast, the supply chain for offshore oil and gas development is long and strong, with
vendors in every state getting business from the activity.
In a 2021 study, The Economic Impacts of the Gulf of Mexico Oil and Natural Gas
Industry, EIAP identified more than 2,400 companies distributed across all 50 states
that provide supplies or services to the offshore sector. EIAP offers this example as a
snapshot of the range of companies that benefit from offshore oil and gas, noting, “This
list greatly underestimates the number of companies who supply the industry.”45 The
45. https://www.noia.org/noia-reports/#flipbook-df_217502/1/, at page 6
2305CP_NOIA.indd 37 4/28/23 6:08 PM

spending impacts from Gulf of Mexico oil and natural gas development extend beyond
the Gulf Coast, permeating every state in the country.
With U.S. and global demand for oil and gas expected to rise for the next two decades,
high levels of spending stemming from offshore oil and gas leasing will continue to
sustain businesses across the country.
■ THE U.S. GULF OF MEXICO SUPPORTS

HIGH-PAYING JOBS
Offshore oil and gas development is widely recognized as an employment engine that
provides good-paying jobs. The study, The Economic Impacts of a 5-Year Leasing
Program Delay for the Gulf of Mexico Oil and Natural Gas Industry,46 estimates
offshore oil and natural gas employment numbers under the base case with no
interruption in lease sales at an average of 372,012 jobs per year throughout the forecast
period of 2022-204047:
2016 2017 2018 2019 2020 2021 2022 2023 2024
Texas 166,737 158,715 155,767 147,462 133,381 136,682 158,256 169,253 164,634
Louisiana 98,247 94,932 95,089 94,621 89,432 89,175 98,473 107,040 106,535
Mississippi 21,524 20,740 20,926 20,415 19,110 19,116 21,593 23,268 22,947
Alabama 29,595 28,870 29,053 28,011 25,157 26,508 29,250 30,871 30,276
Other U.S. States 65,041 60,861 59,631 54,989 43,624 52,990 63,954 63,667 59,865
Total 381,144 364,119 360,465 345,498 310,703 324,472 371,525 394,099 384,257
2025 2026 2027 2028 2029 2030 2031 2032
Texas 168,823 171,201 176,391 179,528 184,119 178,814 168,823 157,130
Louisiana 108,625 110,246 112,832 114,379 116,248 114,839 111,109 106,689
Mississippi 23,447 23,748 24,349 24,675 25,165 24,710 23,765 22,605
Alabama 30,713 30,922 31,489 31,855 32,460 31,972 31,020 29,808
Other U.S. States 60,641 60,881 61,335 62,846 65,014 62,801 58,175 53,819
Total 392,249 396,997 406,396 413,284 423,006 413,136 392,892 370,050
2305CP_NOIA.indd 38 4/28/23 6:08 PM

2033 2034 2035 2036 2037 2038 2039 2040
Texas 150,541 142,724 135,170 120,756 135,144 142,858 148,587 151,886
Louisiana 103,567 100,503 97,262 95,642 96,386 99,700 101,946 103,580
Mississippi 21,901 21,106 20,333 19,889 20,198 20,982 21,564 21,916
Alabama 29,166 28,325 27,531 27,014 27,432 28,141 28,694 29,009
Other U.S. States 51,622 48,733 45,040 43,496 46,369 49,944 51,839 53,838
Total 356,797 341,392 325,336 306,798 325,529 341,625 352,631 360,229
Not surprisingly, the large majority of jobs are along the Gulf Coast, but the offshore
industry depends on supplies and services from the work of Americans in every state.
With its extensive reach and impact, the Gulf of Mexico oil and gas industry supports
between 40,000 and 65,000 jobs each year outside the Gulf Coast.
Employment projections in the event that policy makers in DC reduce leasing

opportunities remains bleak. Under a zero lease sale scenario, Energy and Industrial
Advisory Partners estimates employment losses at an average of more than 57,000
American jobs per year with a peak during of about 116,000 lost jobs48:
2016 2017 2018 2019 2020 2021 2022 2023
Texas 0 0 0 0 0 0 -159 -1,684
Louisiana 0 0 0 0 0 0 -21 -545
Mississippi 0 0 0 0 0 0 -9 -150
Alabama 0 0 0 0 0 0 -17 -168
Other U.S. States 0 0 0 0 0 0 -70 -594
Total 0 0 0 0 0 0 -275 -3,140
2025 2026 2027 2028 2029 2030 2032
Texas -15,274 -25,344 -38,058 -46,490 -54,668 -52,126 -37,024
Louisiana -6,337 -10,536 -16,303 -20,000 -24,028 -24,150 -20,080
Mississippi -1,551 -2,575 -3,929 -4,780 -5,703 -5,572 -4,312
Alabama -1,617 -2,753 -4,122 -5,101 -6,085 -6,011 -4,791
Other U.S. States -5,724 -10,739 -16,608 -22,096 -25,458 -24,323 -17,011
Total -30,503 -51,948 -79,020 -98,466 -115,942 -112,182 -83,218
2305CP_NOIA.indd 39 4/28/23 6:08 PM

2033 2034 2035 2036 2037 2039 2040
Texas -32,757 -26,109 -24,919 -22,476 -16,375 -13,422 -12,366
Louisiana -18,923 -16,681 -16,163 -13,978 -13,346 -13,242 -13,149
Mississippi -3,971 -3,333 -3,258 -2,679 -2,489 -2,339 -2,272
Alabama -4,516 -3,970 -4,028 -3,481 -3,295 -3,184 -3,178
Other U.S. States -15,415 -13,278 -11,916 -8,486 -6,165 -4,014 -3,755
Total -75,582 -63,370 -60,284 -51,100 -41,669 -36,202 -34,720
The 2021 EIAP report, The Gulf of Mexico Oil & Gas Project Lifecyle: Building an
American Energy & Economic Anchor, describes the sizable economic and employment
footprint of shallow-water and deepwater project life cycles to provide a foundation
for developing employment estimates. EIAP establishes the credibility of its numbers,
basing them on a vast database that allows analysts to break down offshore energy
development into five distinct stages: pre-development, development, operations, infill
drilling and tiebacks, and abandonment and decommissioning. Each stage is further
segmented to identify individual activities, types of equipment, primary company
and supplier types, sub-supplier types, and types of employment. Finally, the study
describes the fields of work, occupations, and wages for workers throughout the life
cycle of a lease.
One of the things that differentiates a Gulf of Mexico project from other types of
construction efforts is that it has a massive economic impact over their entire project
life cycle. EIAP identified more 200 types of jobs involved in U.S. Gulf of Mexico oil and
gas production. Together, the women and men who fill these positions work to safely
produce lower-emission, environmentally responsible barrels of oil and natural gas.
Offshore oil and gas jobs are varied and high paying, with an average industry wage
of $69,650, or 29% higher than the national average. Every U.S. state has jobs and
investments tied to the U.S. Gulf of Mexico oil and gas industry.
An average deepwater project produces about $3 billion in total direct wages. Direct
employment associated with a modern deepwater project development averages over
1,435 jobs across the project’s 30-year lifecycle. Indirect and induced employment is
projected to account for an average of over 2,200 additional jobs.
While employment during the first two years of a project’s lifecycle is estimated at only
an average of 880 jobs, during the most active years of the project employment impacts
peak at nearly 14,400 jobs. During normal operations, total supported employment
is projected at around 1,900 jobs. While, these numbers are associated with just one
project, the Gulf of Mexico is illustrated by dozens of such projects and an investment
horizon that could span several decades.
2305CP_NOIA.indd 40 4/28/23 6:08 PM

The study also covered the economic impacts of a shallow water project, which results
in, on average, $16.2 million in annual direct wages, 230 direct jobs supported annually,
390 indirect and induced jobs supported annually, and the same high average annual
wage of $69,650. BSEE reported in 2019 that there were more than 900 producing
platforms in the shallow water of the Gulf of Mexico.49
The offshore industry provides jobs to Americans of all walks of life in communities
throughout the Gulf Coast and the country. Our industry includes companies owned
and managed by all demographics, including women, African Americans, Latinos, Native
Americans, and veterans. Offshore leasing will continue on a global scale over the
coming decades. The offshore oil and gas industry further provides new workers with
the knowledge, skills, and abilities that will be essential for not only oil and gas projects,
but also for renewable energy development.
■ THE U.S. GULF OF MEXICO PROVIDES

AMONG THE LOWEST CARBON
BARRELS IN THE WORLD, WITH A
COMMITMENT TO SAFETY AND
ENVIRONMENTAL PERFORMANCE
The U.S. offshore operates under one of the strongest regulatory and oversight regimes
in the world, which means production here in the United States is more environmentally
friendly than operations in many producing regions in the world. The carbon intensity of
the Gulf of Mexico is 50 percent of that of other producing regions50. Part of the reason
is that U.S. Gulf of Mexico developments deliver high volumes of oil and gas with a far
smaller physical footprint. In 2019, 18 offshore facilities (with a combined surface area
equal to about nine city blocks) produced 75 percent of offshore production51.
The region is also a leader for methane release reductions. This is in large part because
methane releases are closely regulated offshore. Volumes of gas, of which methane is a
primary component, to be flared or vented from offshore facilities are tightly regulated
under the provisions of 30 CFR 250 Subpart K. Over the past few decades, operators
49. https://www.bsee.gov/sites/bsee.gov/files/reports/shallow-water-report-01.pdf
50. Motiwala, and Ismail, “Statistical Study of Carbon Intensities in the GOM and PB,” ChemRxiv, April 13, 2020.
51. Director Scott Angelle, BSEE Director, BSEE Presentation to the Deepwater Technical Symposium, November 13, 2020.
2305CP_NOIA.indd 41 4/28/23 6:08 PM

FIGURE 12
Offshore Production Provides Low Carbon Intensity Barrels
LOWEST EMISSIONS INTENSITY HIGHEST EMISSIONS INTENSITY
~ 20 KgCO2e/BOE ~ 70 KgCO2e/BOE

Carbon Intensity per Barrel by
Oil Producing Regions
Average Scope 1 & 2 Emissions
Source: Wood Mackenzie
DEEPWATER CONTINENTAL SHALE TIGHT CONVENTIONAL HEAVY OIL

SHELF OIL OIL OFFSHORE OIL SANDS
Source: Wood Mackenzie
have moved away from using natural gas driven pneumatic devices to instrument air,
eliminating the methane emissions from operation of such devices. Furthermore,
gas detection systems are generally deployed on facilities, allowing operators to
identify and address methane gas leaks, further reducing methane emissions from
offshore facilities.
Management practices and related regulations for venting and flaring of methane in
the offshore have helped to dramatically reduce the practice in the Gulf of Mexico. The
U.S. Gulf of Mexico accounted for 15% of U.S. oil production in 2019, yet EIA data shows
venting and flaring emissions from offshore oil and gas operations accounted for a
mere 2.6% percent of nationwide energy production venting and flaring emissions in
2019.52 EPA data also shows methane emissions from offshore oil and gas production
accounted for less than one percent of total nationwide methane emissions in 2019.53
In short, the U.S. and world depend upon reliable supplies of oil and natural gas for a high
quality of life and to lift people out of poverty, and U.S. offshore production should be
52. https://www.eia.gov/dnav/ng/ng_prod_sum_a_EPG0_VGV_mmcf_a.htm
53. Draft 2021 Greenhouse Gas Inventory
2305CP_NOIA.indd 42 4/28/23 6:08 PM

the basin of choice for producing that energy because of demonstrably lower GHG and
environmental impacts for an energy source we will continue to need for years to come.
In fact, a 2016 report at the end of the Obama Administration—issued under then-
Secretary Sally Jewell—stated, “U.S. GHG emissions would be higher if BOEM were
to have no lease sales…. Emissions from substitutions are higher due to exploration,
development, production, and transportation of oil from international sources being
more carbon intensive.”54
Recent research from multiple sources continues to validate the low carbon benefits of
U.S. Gulf of Mexico oil leasing and production:
The Breakthrough Institute: In any reasonable scenario, similar to the above

discussion, oil and natural gas demand is projected to account for a significant portion
of the world’s energy portfolio for the coming decades. The Breakthrough Institute,
a global research center that identifies and promotes technological solutions to
environmental and human development challenges, recently examined the need for
continued investment in greenfield oil and gas projects in the United States even
in the context of aggressive decarbonization scenarios that aim to meet ambitious
climate objectives.
In the report, “Oil and Gas Assets at Risk, How will clean energy’s rise impact oil and
gas communities in the United States amidst shrinking fossil fuel demand?”,55 authored
by Rystad Energy, Dr. Zeke Hausfather, Mark Boling, and Peter Liu, the Institute finds
“Despite potentially significant declines in global oil and gas demand across the climate
scenarios by 2050, our findings clearly indicate that investment in new oil and gas fields
may still be necessary to meet future demand for oil and gas in all three of the climate
change mitigation scenarios.”
The authors considered four scenarios, including the Sustainable Development

Scenario (SDS) of the International Energy Agency, which is aligned with the Paris
Agreement goals of keeping warming well below 2° Celsius. The report includes key
conclusions:
■ “Growing economies tend to increase their energy demand especially for the

transportation of goods from producers to consumers. Petroleum products such as
diesel and gasoline are the fuels that keep the cargo ships, aircraft, and trucks that
underlie supply chains operating smoothly.”
54. https://www.boem.gov/sites/default/files/oil-and-gas-energy-program/Leasing/Five-Year-Program/2017-2022/
OCS-Report-BOEM-2016-065—-OCS-Oil-and-Natural-Gas—-Potential-Lifecycle-GHG-Emissions-and-Social-Cost-
of-Carbon.pdf.
55. https://thebreakthrough.org/articles/oil-and-gas-assets-at-risk-impacts-of-declining-fossil-production-in-climate-
scenarios-in-the-us
2305CP_NOIA.indd 43 4/28/23 6:08 PM

■ “[A]pproximately 10 million bbl/d of oil production from new fields is needed between
2030 and 2050 in order to meet global oil demand in SDS, the most ambitious
climate scenario…. [A]dditional investment in new gas production will be required in
the ambitious SDS scenario as well.”
“New investment in oil and gas fields is likely to occur throughout the world, driven
primarily by economic competitiveness and proximity to demand centers of each field.
In the Rystad modeling, substantial greenfield investment occurs in all of the major
producing regions in the world to 2050, including the United States.”
■ “[N]ew investment could be required in greenfield oil and gas production, including
substantial new greenfield production in the United States, in order to meet future
demand. Political initiatives to entirely ban oil and gas production or prevent
investment may therefore be unrealistic or uneconomic.”
■ “The total greenhouse gas impact of oil varies quite substantially across the world
based on the source and method of production….”
■ “Our field-level economic analysis demonstrates that w oil and gas production is
relatively low carbon and, therefore, would be minimally impacted by carbon pricing
in absolute terms relative to production in other regions[]. In particular, US oil is the
“cleanest” on average in the world, although not the cheapest….”
■ “This finding has implications for domestic US oil and gas policy. To reduce the
marginal emissions of oil and gas production, while ensuring security of supply for
the United States and its allies, policy makers should avoid penalizing or preventing
US production exclusively. Rather, policies that promote more aggressive emissions
reductions for US oil and gas production could also seek to displace higher-emitting
products from other major regions of production, thus minimizing the climate impact
of remaining global oil and gas use in a low-emissions future.”56
Wood Mackenzie: According to Wood Mackenzie, reducing oil production from the U.S.
Gulf of Mexico would increase the average emissions rate for global oil production:
Using our recently updated Emissions Benchmarking Tool, which profiles

emissions for more than 2,800 oil and gas assets around the world, [researchers]
Oberstoetter and Usoro were able to compare the carbon intensity of the
principal sources of crude used in the US. Numerous factors drive the differences
in intensity: emissions in Venezuela, Colombia and Canada are driven by the
more energy-intensive processes needed to produce the heavier crude qualities,
while in Iraq flaring is the big problem. The overall picture is clear, however: the
deep water of the Gulf of Mexico is one of the lowest-carbon sources of oil used
56. https://thebreakthrough.org/articles/oil-and-gas-assets-at-risk-impacts-of-declining-fossil-production-in-climate-
scenarios-in-the-us
2305CP_NOIA.indd 44 4/28/23 6:08 PM

in the US, with only Saudi Arabia coming in lower. In the light of that, Oberstoetter
and Usoro argue, restrictions on US production in the Gulf could end up having a
counterproductive impact on global emissions. “Removing or handicapping a low
emitter hurts the collective global average.”57
McKinsey: In the report titled “How the Gulf of Mexico can further the energy
transition,” McKinsey describes four key factors that give the deepwater Gulf of Mexico
a “low carbon advantage”:
First, in contrast to other regions where flaring natural gas without a market is
more commonplace, most of the natural gas produced in the Gulf of Mexico is
sold to local markets, which results in minimal routine flaring and, consequently,
less GHG emissions. Second, the facilities have efficient, modern designs that
minimize methane leakage. Third, wells and production facilities have a high
throughput, minimizing the number of energy-intensive processes required to
bring on new supply, such as drilling. And fourth, operators have made active
decarbonization efforts to stay in line with environmental sustainability goals
and in compliance with regulations.58
McKinsey estimates production from the U.S. Gulf of Mexico could decrease by about
800,000 barrels per day by 2040 without additional projects beyond those that have
already been sanctioned. In that situation, McKinsey expects lost production would
be made up by substitutions from other parts of the world without much oil demand
destruction. The country would be able to import sufficient oil, but it would come from
higher-emitting basins, resulting in an increase in greenhouse gas emissions globally:
This supply reduction would have to be offset by alternative sources to meet global
demand, which could hinder net-zero goals significantly. Because many other oil
producing regions globally have total unit costs similar to those in the Gulf of Mexico,
global oil price increases or substitution with other energy sources wouldn’t be
expected, and global demand for oil would remain unchanged. Instead, the reduced
Gulf supply would be offset by production increases from other sources, such as other
deepwater basins, shale, and OPEC. Based on the higher emissions per barrel of this
new supply, global emissions would increase by 50 million to 100 million metric tons of
CO2e through 2040.59
McKinsey also points out other significant, adverse consequences if America moves
away from deepwater Gulf of Mexico oil production, “A shift in production from the Gulf
57. https://www.woodmac.com/news/the-challenge-of-negative-emissions/
58. Brown, Di Fiori, Smith, and Yanosek, “Deepwater Gulf of Mexico’s role during the energy transition,” McKinsey, September
2022, at pages 3-4.
2022, at page 6.
2305CP_NOIA.indd 45 4/28/23 6:08 PM

of Mexico to other basins could also have broader implications for the U.S. economy,
including the loss of more than 100,000 jobs and a $30 billion to $40 billion reduction in
federal government revenue from reduced royalties and lease-sale proceeds.”60
Offshore energy is a true story of accomplishing more with less – creating more energy
with less environmental impact. Offshore production platforms are incredible edifices
of continuously evolving technology that allow enormous amounts of energy to be
produced through a relatively small footprint. Incredibly, 18 deepwater facilities, which
equate to about the size of only nine city blocks, produce about the same amount of oil
as the entire state of North Dakota.61
The offshore oil and gas sector operates with an unremitting commitment to safety
and environmental protection. BSEE has highlighted key data points in the area of
environmental performance:
■ Consistently achieved ratio of less than 1.25% flared/vented gas to produced gas;
one of the best performing producing provinces in the USA
■ Zero incidental marine mammal or sea turtle fatalities from OCS oil and gas
exploration and production activities from at least 2017 through November 2020 [the
date of the presentation]
■ Less oil spilled in 2018 and 2019 form active exploration and production operations
on federal offshore leases in at least a quarter century
■ 2018 ratio of volume spilled to volume produced: approximately 13 tablespoons in a
660,430 gallon Olympic-sized pool
■ 2019 ratio of volume spilled to volume produced: approximately 17 tablespoons in a
660,430 gallon Olympic-sized pool62
From a worker safety standpoint, the offshore oil and gas industry has performed with
a low recordable injury/illness rate when compared to other industries. The following
chart shows the continued low injury/illness trend rate for the sector [FIGURE 13].
Inarguably, any injury is one too many, and the industry continues to work collaboratively
in safety programs and with Interior, other key agencies, and the academic community
in a continuous effort to identify and mitigate against risks.
2022, at page 6.
2305CP_NOIA.indd 46 4/28/23 6:08 PM

FIGURE 13
Total injury/illness rates across multiple industries
4
Worker recordable + DART injuries/illnesses per 200,0000 work-hours
3.5
Service Providers (All)
3
2.5
Electric Power Generation, Transmission, Distribution
2
1.5
1 Offshore OCS Oil & Gas, Overall
0.5 Nuclear Electric Power Generation
0
2010 2011 2012 2013 2014 2015 2016 2017 2018
Service Providing, All (Multiple NAICS Codes) Electric Power Gen., Trans., Distrib. (NAICS Code 2211)
OCS Oil & Gas, Overall (BSEE Data)2 Nuclear Electric Power Generation (NAICS Code 221113)2
■ THE OFFSHORE GULF OF MEXICO IS

CHARACTERIZED BY INNOVATION AND
ADVANCED TECHNOLOGIES
America’s offshore energy sector employs technologies that not long ago were
inconceivable. Today, satellites provide real-time imaging and communications support
for offshore oil and gas platforms. On the seafloor, subsea autonomous robots are
monitoring production and equipment health, providing real-time data to engineering
experts on the offshore platforms as well as in onshore facilities that connect experts
from around the world to enable the best operational decisions to be made. Remote
operations and automation have eliminated the need for large offshore crews for
certain activities, which not only cuts down on trips to and from the assets but improves
safety for offshore workers.
Machine learning (ML) and artificial intelligence (AI) are revolutionizing the industry’s
decision-making abilities. Automated sensing and inspection allow companies to
2305CP_NOIA.indd 47 4/28/23 6:08 PM

capture enormous amounts of data that provide considerably more insight into
operations. With improved knowledge of the activities underway, workers are far less
likely to be injured.
ML enables complex simulations using predictive data to discover hidden patterns.

Paired with AI, ML lets companies test for potential negative impacts of operations
and gauge the environmental risk of a new project before plans are finalized. And as
development progresses, AI incorporates lessons learned to streamline informed
decision-making.
Technology advances are shrinking an already small offshore footprint. The U.S.
offshore industry is producing increasingly more energy without appreciably expanding
the real estate required for operations, which preserves the U.S. Gulf of Mexico’s
performance as a low-emissions basin.
Offshore production is the energy anchor the world needs. Multi-billion-dollar offshore
projects produce massive amounts of oil and natural gas, and advances in technology
are enabling offshore fields to produce more, cleaner barrels for even longer. Seismic
technology and better and smarter subsea tiebacks and other infrastructure open
the door to a new era of productivity and efficiency, all while continuing to improve
environmental performance.
The graphic below shows some of the technology used in the offshore oil and gas
sector to promote safety, environmental protection, emissions reductions, reliability,
and efficiency [FIGURE 14].
STATE OF DEEPWATER GOM

PRODUCTION
Oil Production 2019 Oil Production
Oil Production 50% 25%Oil Production

2019 25%
50% 25% 25%
18 DEEPWATER
FACILITIES
(TOTAL SURFACE AREA = 9 CITY BLOCKS)
18 DEEPWATER
PRODUCE:
FACILITIES
(TOTAL SURFACE AREA = 9 CITY BLOCKS)
13% 13% 74%

75% 10%
PRODUCE:
13% 13% 74%

75%
OF OFFSHORE
PRODUCTION
OF OFFSHORE
10%
OF NATIONAL
PRODUCTION
OF NATIONAL
Facilities
Facilities
PRODUCTION PRODUCTION
2305CP_NOIA.indd 48 4/28/23 6:08 PM

FIGURE 14
Onshore Support
Drones
Onshore support for offshore projects
include the use of artificial intelligence,
Drones provide workers machine learning and cloud computing.
increased ability for inspection The growth of computing power means
and monitoring of offshore workers onshore can provide realtime
platforms and production. support and expertise to the folks offshore.
Satellites
Allow for monitoring of

platforms to ensure there
are no undetected leaks Workers
occurring.
Rig Standardization
Allows for more efficient facilities

and also increases familiarity for
workers, adding safety benefits.
Floa
ting Containment Systems
prod
uctio
n New containment systems are the result
of unprecedented industry-government
collaboration and offer a full range of oil
spill response capabilities. These
Subsea Systems companies offer solutions to an ever
growing portfolio of extreme scenarios.
Advances in engineering and material
sciences have made subsea systems
more efficient and have lowered risks.
Blowout Preventer
A safety requirement to prevent the
uncontrolled release of oil or natural gas,
Remotely Operated Vehicles blowout preventers are constantly
advancing and are able to accommodate
ROVs, which now can incorporate artificial higher and higher stress environments.
intelligence, provide high-resolution
real-time imaging and can be used for
inspections and repairs.
■ OFFSHORE FACILITIES CREATE

AND SUPPORT FLOURISHING
MARINE ECOSYSTEMS
From the moment an offshore platform is installed, it begins its transformation into a
flourishing marine ecosystem. BSEE states, “A typical eight-leg structure provides a
home for 12,000 to 14,000 fish, according to a study by the Coastal Marine Institute.
A typical four-leg structure provides two to three acres of habitat for hundreds of
marine species.”63
Concerns raised by fishermen, divers, and coastal states about potential damage to
marine life should offshore structures that had developed into marine ecosystems
be removed led to the Rigs to Reefs program, which was formalized by Congress as
the National Fishing Enhancement Act in 1984. This act supports the development of
63. https://www.bsee.gov/what-we-do/environmental-compliance/environmental-programs/rigs-to-reefs
2305CP_NOIA.indd 49 4/28/23 6:08 PM

Photo 1183424466 © Tunatura | Dreamstime.com
artificial reefs and establishes a permitting program for formally converting offshore
facilities into artificial reefs.
According to BSEE, the Rigs to Reefs program provides the following benefits64:
■ For the environment, repurposing obsolete structures saves fuel emissions that
otherwise would be expended transporting and disposing of the structure. It also
enriches the marine life in the area.
■ For oil and gas companies, repurposing obsolete structures saves them the costs
of removing, transporting, and disposing of them onshore. BSEE regulations
require that, within one year of a lease’s expiration, the obsolete structure
must be removed.
■ For states, the artificial reefs attract marine life that enhance fisheries
and contribute to the economy by attracting recreational and commercial
fishing and diving.
64. https://www.bsee.gov/what-we-do/environmental-compliance/environmental-programs/rigs-to-reefs
2305CP_NOIA.indd 50 4/28/23 6:09 PM

■ For divers and recreational and commercial fishers, artificial reefs create a rich
diversity of marine life.
■ For marine species, the artificial reefs provide habitat, shelter, food, and other
necessary elements for biodiversity and a productive ocean.
Isabelle Gerettsen, of the BBC, reported on artificial reefs in January 2021:
Offshore rigs are among the most productive fish habitats in the world,
according to marine biologist Milton Love who has spent 20 years studying fish
populations around oil and gas platforms in California. They provide marine
wildlife with food, shelter from predators and a safe breeding ground.
For some species, the rigs are even better nurseries than natural reefs, says
Love. The towering pylons are the perfect spawning grounds for tiny fish larvae.
“A lot of them are just drifting,” says Love. “They want to settle.” The 500 ft (150m)
high underwater structures provide an opportunity for just that.
One of the big beneficiaries is rockfish, stocks of which have been heavily
depleted due to overfishing along the US West Coast. These fish are found
in abundance around oil platforms. For instance, the platforms have helped
revive the critically endangered bocaccio rockfish. “We’ve found a very high
density of young bocaccio at platforms, around 400,000 at six platforms. We
didn’t see that at natural reefs,” says Love, adding that the number of juvenile
bocaccio found at rigs was enough to boost the adult stock of the Pacific Coast
population by around 3%.65
[Emphasis in original publication.]
According to a study conducted by Love and others and published in the Proceedings
of the National Academy of Sciences, “Oil and gas platforms off the coast of California
have the highest secondary fish production per unit of area of seafloor of any
marine habitat that has been studied, about an order of magnitude higher than fish
communities from other marine ecosystems.”66
As of year-end 2021, more than 570 offshore facilities had been reefed in the Gulf of
Mexico. Research continues to demonstrate that offshore artificial reefs develop into
among the most flourishing marine ecosystems.
65. Gerretsen, Isabelle, “As offshore oil and gas platforms come to the end of their working lives, the remarkable ecosystems
beneath the waves come into their own,” January 26, 2021.
66. Claisse, Pindell, et. al. “Oil platforms off California are among the most productive marine fish habitats globally.” Proceedings
of the National Academy of Sciences. October 28, 2014.
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■ THE U.S. GULF OF MEXICO ADHERES
TO A STRONG SYSTEM OF SAFETY AND
ENVIRONMENTAL PROTECTION
America’s offshore oil and natural gas industry is characterized by the continued
advancement of technology and systems integrity, the application of extensive industry
technical standards, and a robust regulatory regime. The industry continues to develop
and improve on technologies to prevent environmental incidents, examining everything
from the materials used in offshore operations, to the development of software
and control systems to manage operations, to the development, production, and
deployment of modern drillships and production facilities that bring energy to market,
to the design and manufacture of blowout prevention systems, subsea safety valves,
and other innovative safety equipment.
This ongoing development and improvement of industry standards promotes reliability

and safety in offshore operations through the use of proven engineering practices.
The American Petroleum Institute (API) publishes industry technical standards under
a process accredited by the American National Standards Institute. API standards
are regularly reviewed to ensure they remain current and appropriate. Standards are
developed in an open and transparent process that includes subject matter experts
from academia, government, and industry. API standards are the most widely cited oil
industry standards by federal, state, and international regulators.
API has more than 200 exploration and production standards that address offshore
operations, covering everything from subsea safety valves to comprehensive guidelines
for offshore safety programs, and an estimated 100 such documents have been
incorporated into federal regulations. Oil and gas operators on the OCS are subject to
myriad regulatory requirements, including more than two dozen statutory authorities
and more than 80 Code of Federal Regulation parts implemented pursuant to those
statutes. In addition, more than two dozen significant approvals and permits are
required for OCS operations.
Through BSEE and its predecessor agencies, the government has significantly
changed regulatory requirements applicable to offshore oil and natural gas operations.
Companies must implement safety and environmental management systems (SEMS),
and audits must be completed by independent third parties. BSEE regulations include
extensive requirements for well design and integrity and blowout preventer and control
systems. Under the current drilling safety provisions, BSEE requires, among other
things: identification of the mechanical barriers and cementing practices that will be
used; independent, third-party verification that the blowout prevention equipment
2305CP_NOIA.indd 52 4/28/23 6:09 PM

is designed for the specific equipment on the rig and for the specific well design;
independent, third-party verification that the blowout prevention equipment will
operate in the conditions in which it will be used; a certification signed by a registered
professional engineer that the casing and cementing design is appropriate for the
purpose for which it is intended under the expected conditions; and for wells that use
subsea blowout prevention equipment, the inclusion of two independent barriers,
including one mechanical barrier, for each annular flow path. There also are extensive
requirements for the maintenance, testing, and inspection of blowout prevention
equipment. In addition, the Coast Guard, which has regulatory authority for marine
vessels utilized in offshore oil and natural gas operations, has also taken extensive
regulatory action to advance safety in offshore operations.
Another significant achievement of the U.S. offshore oil and natural gas industry is the
creation of well intervention and containment consortia that were founded in 2010 to
provide containment technology and response capabilities for the unique challenges of
capping a well releasing oil thousands of feet below the water’s surface. These groups,
which include MWCC and HWCG, maintain rapidly deployable systems designed to
stem the uncontrolled flow of hydrocarbons from a subsea well and provide training for
member companies on system installation and operation.
BSEE requires companies to demonstrate they have staff resources and access to
equipment to deploy systems to cap a well and capture uncontrolled hydrocarbons.
Companies prove their compliance with this requirement through a contract with
or membership in MWCC or HWCG. BSEE has also instituted new requirements for
determining the worst-case blowout discharge and the associated demonstration
of capability to effectively respond to such an event. On its part, the industry has
enhanced its ability to respond to a potential offshore environmental incident through
improved oil spill response planning and the increased availability of spill response
tools such as dispersants, in-situ burning capabilities, mechanical recovery, and
shoreline protection.
To ensure these requirements are being met, BSEE implements an active and ongoing
system of oversight and inspection. Data from 2019 provides a snapshot of the strong
oversight in place:
BSEE Inspections: 2019
■ 1,665 total number of OCS facilities inspected

■ 126 BSEE inspectors — Based in Alaska, California, Louisiana, and Texas
■ 12,489 total number of inspections
■ 14 inspection categories, including production operations, well operations,
environmental, pipelines and meters
■ 694,093 miles flown in support of inspections
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Inspectors conducted performance-based risk inspections on:
■ 57 OCS facilities, leading to

» 2 safety alerts
» 20 recommendations 67
Interior confirmed the strength of its regulatory oversight system over offshore oil
and gas operations in its record of decision for Lease Sale 257. The decision, signed by
Principal Deputy Assistant Secretary for Land and Mineral Management Laura Daniel-
Davis on August 31, 2021, concluded:
Pursuant to my authority to exercise the delegable functions and duties of

the Assistant Secretary for Lands and Mineral Management, I have concluded
that holding GOM region-wide oil and gas Lease Sale 257, as described in
Alternative A of the 2018 GOM Supplemental EIS, meets the purpose of and need
for the proposed action, balances regional and national policy considerations,
and includes appropriate measures to minimize potential environmental and
socioeconomic impacts. I have also concluded that GOM Lease Sale 257, as
described in this ROD and in the forthcoming Final Notice of Sale, is subject to
adequate environmental safeguards and is consistent with the maintenance of
competition and the meeting of national energy needs…
To minimize the environmental impacts that could occur from OCS oil- and gas-
related activities following a lease sale, BOEM imposes mitigation measures that
have proven effective in the past in avoiding or reducing impacts. The mitigation
measures that I am adopting in the form of lease stipulations for this lease sale
are described below in Section 5. While offshore exploration and development
cannot be made risk free, OCS oil- and gas-related activities can be conducted
safely and responsibly with strong regulatory oversight and appropriate
measures to protect human safety and the environment. Since the Deepwater
Horizon explosion, oil spill, and response, BOEM and the Bureau of Safety and
Environmental Enforcement (BSEE) have raised standards for offshore drilling
safety and environmental protection to reduce the risk of oil spills and their
severity, and have improved the Federal Government’s and industry’s ability to
respond in the unlikely occurrence of another large oil spill….
The decision to hold Lease Sale 257 recognizes the role that GOM oil and gas
resources play in addressing the Nation’s demand for domestic energy sources
and fosters economic benefits, including employment, labor income, and tax
revenues, which are highest in Gulf Coast States and also distributed widely
across the United States. Revenues from offshore oil and gas lease sales support
2305CP_NOIA.indd 54 4/28/23 6:09 PM

Photo 856838518 © curraheeshutter | Dreamstime.com
national conservation programs and coastal resiliency for applicable coastal

states and political subdivisions under the Gulf of Mexico Energy Security
Act of 2006.68
Hydrocarbon developments on the U.S. OCS are held to exceptionally high standards
for operations by some of the most robust regulations, oversight, and enforcement
in the world. The regulatory system provides assurances for safe, environmentally
responsible operations, establishing the U.S. as the gold standard for the development
and production of resources, where stringent requirements for operation are enforced
and where responsible development continues to drive down the carbon footprint
of operations.
68. https://www.boem.gov/sites/default/files/documents/oil-gas-energy/GOM-LS-257.pdf
2305CP_NOIA.indd 55 4/28/23 6:09 PM

■ U.S. OFFSHORE ENERGY PRODUCTION
GENERATES TREMENDOUS VALUE FOR
TAXPAYERS, INCLUDING FUNDING FOR THE
LAND & WATER CONSERVATION FUND,
THE OUTDOOR RECREATION LEGACY
PARTNERSHIP PROGRAM, AND COASTAL
RESILIENCY AND RESTORATION
Energy production from the Gulf of Mexico generates multiple revenue streams for
the government. The first is the bonus bid, paid up front to the U.S. government by
operators that acquire a federal oil and gas lease. The bonus bid is paid without any
knowledge of what resources might be discovered and is retained by the federal
government regardless of whether oil and gas are produced from the lease. The second
revenue stream comes from annual rental payments tendered to hold the lease until it
produces or expires. This revenue is paid to the federal government while companies
work through internal assessments and move through the robust permitting process
overseen by the DOI. The final revenue source is the royalty payment made when energy
resources are produced in federal waters, at which point companies extracting those
resources are required to pay the federal government—this is in recognition of the fact
that resources on public lands and waters are a public resource.69 Royalty rates have
increased over time for federal leases in the Gulf of Mexico. In 2008, the royalty rate was
increased to 18.75 percent for all water depths. In 2017, to encourage continued interest
in the more mature shallow waters, the royalty rate for newly acquired shallow water
leases was decreased from 18.75 percent to 12.5 percent. Since that time, however, 84
percent of the leases acquired at OCS lease sales have been in deepwater regions that
are subject to the higher 18.75 percent royalty rate.70
Critically, the significant payments brought in by offshore oil and gas payments help
fund a wide range of state and federal programs, namely around conservation and park
maintenance. Disbursements from offshore oil and gas in fiscal years 2016 through 2019
were enormous, reaching almost $5 billion in 2019:71
69. This discussion does not include taxes paid to federal, state, and local governments, which accounts for billions of dollars in
additional funding.
70. https://revenuedata.doi.gov/how-it-works/revenues/#oil-gas-rates
71. https://revenuedata.doi.gov/query-data/?dataType=Revenue
2305CP_NOIA.indd 56 4/28/23 6:09 PM

Recipient 2016 2017 2018 ↓ 2019
U.S. Treasury $1,865,028,729 $1,748,637,164 $2,789,421,771 $3,826,926,987
Land & Water

$883,627,823 $891,828,225 $893,887,297 $877,772,576
Conser ...
Historic
$0 $150,000,000 $150,000,000 $150,000,000
Preservation ...
Other $158,644,486 $122,238,329 $116,875,635 $110,056,157
All recipients $2,907,301,038 $2,912,703,718 $3,950,184,703 $4,964,755,720
GOMESA Disbursements to States/CPSs and the LWCF State Grant

Program, FY2009-FY2022 ($ millions)
Subtotal
Year of State LWCF State Total Revenue
Disbursementa Alabamab Louisianab Mississippib Texasb Revenue Programc Shared
FY2009 7.7 7.9 6.9 2.7 25.2 8.4 33.7
FY2010 0.8 0.9 0.7 0.3 2.7 0.9 3.6
FY2011 0.3 0.3 0.2 0.1 0.9 0.3 1.2
FY2012 0.1 0.1 0.1 <0.1 0.3 0.1 0.4
FY2013 0.1 0.1 0.1 <0.1 0.3 0.1 0.4
FY2014 1.3 1.4 1.2 0.5 4.3 1.4 5.8
FY2015 0.7 0.8 0.7 0.3 2.4 0.8 3.3
FY2016 0.1 0.1 0.1 <0.1 0.3 0.1 0.4
FY2017 0.3 0.3 0.3 0.1 1.0 0.3 1.3
FY2018 26.8 82.8 27.8 50.6 188.0 62.6 250.6
FY2019 30.6 94.7 31.7 57.9 214.9 71.6 286.6
FY2020 50.0 155.7 51.9 95.3 353.0 117.6 470.6
FY2021 35.1 109.9 36.5 67.4 248.9 82.9 331.8
FY2022 34.8 111.8 36.8 68.8 252.3 84.1 (est.) 336.4 (est.)
1,725.8
Total 188.4 567.0 194.9 344.1 1,294.5 431.2 (est.)
(est.)
Sources: Office of Natural Resources Revenue (ONRR), “Natural Resources Revenue Data: Data Query Tool,” at
https://revenuedata.doi.gov/query-data/?dataType=Disbursements; and National Park Service (NPS) budget
justifications for FY2011-FY2023, available at https://www.nps.gov/aboutus/budget.htm.
Notes: CPSs = coastal political subdivisions; LWCF = Land and Water Conservation Fund; GOMESA = Gulf of Mexico Energy
Security Act of 2006 (43 U.S.C. §1331 note). Dollar amounts are nominal (not adjusted for inflation). GOMESA Phase II revenues are
first reflected in FY2018 payments. The figures reflect budget sequestration. Totals may not sum precisely due to rounding.
a. T
he first payments of GOMESA revenues occurred in 2009. Under GOMESA Section 105(c), revenues are disbursed to the
states and the LWCF state grant program in the fiscal year following their receipt.
b. R evenue disbursements for each state include disbursements to the coastal political subdivisions (CPSs) of each state.
c. A mounts correspond with the year revenues were shown in the NPS budget.
2305CP_NOIA.indd 57 4/28/23 6:09 PM

These funds go not only to the federal Land and Water Conservation Fund, but also to
state governments along the Gulf Coast, as noted in a recent Congressional Research
Service report on the topic that includes the related chart “GOMESA Disbursements to
States/CPSs and the LWCF State Grant Program, FY2009-FY2022.” 72
These revenues are important today and will continue to be a critically important piece
of the energy and economic story in the United States.
Historically, the offshore oil and gas industry has been an important revenue generator
for federal, state, and local governments. Between 2000 and 2018, more than $120 billion
in high bids, royalties and rents were paid to government entities73. A portion of these
revenues flow into key conservation programs, such as the Land & Water Conservation
Fund (LWCF), which is funded entirely by offshore oil and gas production, and beginning
in 2021, certain provisions established in the recent Great American Outdoors Acts for
national park maintenance.
LWCF provides recreational opportunities, preserves ecosystem benefits for local

communities, and enables public access to outdoor areas in urban regions. One
program – the Outdoor Recreation Legacy Partnership Program, which is funded
through the National Park Service – allocates funds to build new parks and improve
existing ones in economically disadvantaged urban areas throughout the country. More
than $28 million has been distributed to approximately 50 disadvantaged communities
since the creation of the program by Congress in 2014. The Outdoor Recreation Legacy
Partnership Program and programs like it have created safe, healthy outdoor recreation
spaces in Atlanta, Milwaukee and Newark and other cities across the United States.
The National Park Service award of a $750,000 grant to Philadelphia Parks and
Recreation to revitalize Mifflin Square Park is one of many examples of how revenue that
comes directly from offshore oil and gas operations provides healthy outdoor spaces
for inner city residents. Funded through the Outdoor Recreation Legacy Partnership
Program, the rejuvenated Southeast Philadelphia park provides a neighborhood of
more than 13,500 people an exceptional new playground and space for community
gatherings, recreation, and athletics.
72. https://crsreports.congress.gov/product/pdf/R/R46195
73. https://revenuedata.doi.gov/
explore/?dataType=Revenue&location=NF&mapLevel=State&offshoreRegions=true&period=Fiscal%20Year&year=2019
2305CP_NOIA.indd 58 4/28/23 6:09 PM

Jesse Allen Park in Newark, N.J., is another example. It is the second largest city-owned
park and is surrounded by several schools and youth facilities, including a popular Boys
& Girls Club facility. Commenting at the opening of this park, Newark Councilwoman
Gayle Chaneyfield Jenkins said, “As we continue to deal with the burden of crime in
our community, open space and recreation have always been a great equalizer and
protective factor for our children. This is a great day for Newark and an awesome day
for the Central Ward.74” Offshore oil and gas production thus promotes positive
environmental justice benefits by providing the funding to make parks and recreation
more readily available to underprivileged neighborhoods.
On July 29, 2022, Interior announced that it will distribute another $192 million as part
of this program. According to Interior Secretary Deb Haaland, “The Outdoor Recreation
Legacy Partnership program is essential to expand our communities’ connections
to urban green spaces, where children can play, families can connect, and a love and
appreciation for the outdoors can be nurtured. The funding and programmatic changes
we are announcing today will allow for us to support bigger ideas and more communities
in their pursuit of creating more parks and places to get outside for every American.” 75
These parks provide a community oasis, offering outdoor spaces for the enjoyment of
inner-city residents, especially children.
Further, in April 2022, Interior disbursed more than $250 million for coastal conservation
and other programs, commenting, “Today’s action represents the second-largest
disbursement since Interior first began disbursing GOMESA revenues to states and
their [coastal political subdivisions (CPS)] in 2009. Since GOMESA’s passage, the
Interior Department has disbursed over $1.26 billion to the coastal states and their
CPS.” 76 These are critical revenues for vital climate resiliency and adaptation programs.
Revenues shared with Gulf Coast states through GOMESA are used by state and local
governments for a host of vital programs, including wetlands preservation, coastal
restoration, flood prevention and hurricane mitigation.77 GOMESA is used to fund the
response and resiliency of coastal states like Louisiana to impacts from climate change.
74. https://www.tapinto.net/towns/newark/sections/central-ward/articles/newark-receives-federal-grant-to-
complete-jessie
75. https://www.doi.gov/pressreleases/interior-department-announces-192-million-create-public-parks-expand-recreation
76. https://www.doi.gov/pressreleases/interior-department-disburses-over-252-million-gulf-states-supporting-coastal
77. https://www.boem.gov/oil-gas-energy/energy-economics/gulf-mexico-energy-security-act-gomesa
2305CP_NOIA.indd 59 4/28/23 6:09 PM

■ COMPANIES IN THE OFFSHORE OIL AND
GAS SUPPLY CHAIN PLAY A KEY ROLE IN
INVESTING IN, SCALING, AND DEPLOYING
LOW CARBON SOLUTIONS
There is no linear process for addressing climate change. Achieving our goals requires
the advancement of principles of innovation, conservation, efficiency, resiliency,
mitigation, and adaptation as part of a systematic, global approach.
This fact is well understood by the offshore energy industry and has been
demonstrated through a track record of innovation and technological advancement
that is solving energy challenges, increasing efficiency, and reducing emissions. Not
only do we help solve energy and climate problems, we scale and deploy real-world
solutions. Whether it is the buildout of new offshore wind projects, developing CO2
storage facilities, finding new ways to produce hydrogen, or optimizing logistics and
operations to reduce our carbon footprint, the offshore energy industry is at the
forefront of empowering energy solutions and emission reductions.
The diverse companies active in offshore energy development are committed to

innovation, best practices, and deployment of advanced technologies that are central
to addressing the climate challenge. The energy transition cannot occur without the oil
and gas industry. The offshore oil and gas sector, in particular, has the unique ability and
opportunity to innovate and to scale technological solutions that lead to a lower carbon
future. Globally and at home, far too many people still do not have functional access to
electricity, and that situation will be compounded as energy demand continues to rise.78
The energy transition must be achieved in a way that increases the access, affordability,
and reliability of energy for everyone.
The offshore sector is continuously finding ways to shrink its already small
environmental footprint by introducing technologies and innovations that can benefit
other sectors as well. Whether it is a traditionally oil-and-gas focused multi-billion
dollar company investing in offshore wind equipment manufacturing and building
renewable energy incubators, or the deployment of electric remotely operated vehicles
(ROVs) that were developed for the oil and gas industry and now being used to monitor
offshore wind facilities, or the incorporation of virtual and augmented reality into
worker training to reduce risk, the offshore oil and gas industry is driving efficiency and
reducing emissions in ways that will strengthen and accelerate the energy transition.
78. https://www.realclearenergy.org/articles/2019/09/11/no_need_for_energy_poverty_110474.html
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THE SUCCESS OF
A LOW-CARBON
FUTURE DEPENDS
ON THE SUCCESS OF ALL
ENERGY INDUSTRY SECTORS
The offshore oil and gas industry helped build the first U.S. offshore wind farm
offshore Block Island, Rhode Island, and is involved in other wind projects up and
down the Atlantic Coast. Block Island showed that the synergy between offshore
oil and gas and wind expedites renewables development. Removing or restricting
investment opportunities for the offshore oil and gas sector would eliminate a key
source of engineering expertise, not to mention RD&D funding that can find, scale,
and deploy the solutions to many of the technical challenges currently associated with
decarbonization efforts.
In the report, The Role of Oil and Gas Companies in the Energy Transition, Robert
Johnston, Reed Blakemore, and Randolph Bell acknowledge the importance
of oil and gas companies in both supplying traditional fuels and in leading in
decarbonization efforts.
[O]il and gas remain an important part of the energy mix, especially in developing
regions. The International Energy Agency’s Sustainable Development Scenario
(SDS) and the Shell Sky Scenario—both aggressive decarbonization forecasts—
show an ongoing, long-term role for oil and gas, even while demand levels are
reduced from where they stand today. In the United States, India, and China—the
three largest greenhouse gas emitters—natural gas in particular has the potential
to remain an integral component of the low carbon energy transition for decades
to come, depending on the policy mechanisms and technologies in place.79
The authors highlight the proactive approach being taken by oil and gas companies to
contribute the emissions reductions efforts:
79. Johnston, Blakemore, and Bell, The Role of Oil and Gas Companies in the Energy Transition, The Atlantic Council, January
2020, at page 1.
2305CP_NOIA.indd 61 4/28/23 6:09 PM

Oil and gas companies are responding by looking at where and how they do
business and confronting a rethink of business models in a decarbonizing
world. These companies have a range of tools when it comes to engaging
with decarbonization efforts in ways which allow their participation in the
decarbonizing economy. Where energy demand is growing rapidly, oil and gas
companies can endeavor to support coal-to-gas switching and investing in
infrastructure that enables electrification to meet end user demand and support
lower GHG upstream operations. Companies can also focus on using renewables
and new technologies not just as a hedge against demand risk or to decarbonize
their production, but to leverage their expertise with supply chains and market
development to support low carbon energy deployment in the energy transition
on-the whole.80
Companies across the offshore oil and gas supply chain are making investments and
directly participating in decarbonization efforts such as carbon capture and storage,
geothermal, hydrogen, and deployment of technologies in operations that reduce
emissions. This industry is a key funder of zero- and low-carbon energy development
and deployment. The future success of decarbonization efforts depends upon
continued revenue generation from companies in the oil and gas sector.
Dan Romito, Consulting Partner at Pickering Energy Partners, believes the role of oil and
gas companies is critical to green innovation: “These companies are active sponsors of
the green revolution and are responsible for a substantial proportion of functional green
technology.”81 Romito’s conclusion is based upon research conducted by academics
from Harvard, the University of Texas, and DePaul University who found that that “oil,
gas, and energy-producing firms…are key innovators in the United States’ green patent
landscape.”82
The success of a low-carbon future depends on the success of all energy industry
sectors. Bringing to bear its long history of innovation and ingenuity, the offshore
energy industry is poised to drive the energy transformation and develop and
deploy global decarbonization technologies. According to Romito, “The expertise
housing decarbonization implementation lies within the fossil fuel industry. Without
their participation, the successful execution of the energy transition is more of a
pipe dream.”83
80. Johnston, Blakemore, and Bell, The Role of Oil and Gas Companies in the Energy Transition, The Atlantic Council, January
2020, at page 1.
81. Romito, Accelerating the Energy Transition Requires Bridge Building, Pickering Energy Partners, September 2022 [emphasis
in original].
82. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3718682
83. Romito, Accelerating the Energy Transition Requires Bridge Building, Pickering Energy Partners, September 2022.
2305CP_NOIA.indd 62 4/28/23 6:09 PM

■ OFFSHORE ENERGY DEVELOPMENT
INCREASES OUR NATIONAL SECURITY
The U.S. domestic energy policy helps determine the level of activity in the Gulf of
Mexico, but regardless of the amount of exploration and development in U.S. coastal
waters, other countries will continue to offer rights to explore, develop, and produce
offshore oil and gas. Restricting production in the Gulf of Mexico will not end the
production of oil; however, limiting opportunities at home will shift production to
countries like Russia, China, and Iran.
An example of this can be seen right across the waters of the Gulf of Mexico. As a
consequence of limited opportunities in the U.S. offshore region, investment has
shifted to the Mexican sector. Mexico is producing oil and gas adjacent to state and
federal waters belonging to the United States. The map below shows how Mexico has
outpaced the U.S. in Gulf of Mexico oil and gas leasing opportunities, surpassing the
U.S. in total acres under the lease [FIGURE 15].
But it goes well beyond Mexico. The U.S. and world need oil and gas, and the clear
choice should be in producing this energy here at home, in U.S. waters. The Russian
invasion of Ukraine has shined the spotlight on the critical link between energy security
and national security. Every barrel of oil that the American women and men of the Gulf
of Mexico produce is a barrel that our nation and our allies do not have to import from
countries like Russia, Iran, or China. Abandoning the Gulf of Mexico reduces American
energy security, locks away low-emissions development, increases the cost of energy,
and outsources American jobs and investment to pollution havens.
According to Daniel Yergin, Vice Chairman of IHS Markit:
The extraordinary growth in U.S. oil and gas production is a geopolitical and
economic asset for the U.S. that contributes to global energy security. As the
domestic oil-and-gas industry continues to rebound from the spring 2020
price collapse caused by the onset of Covid, the U.S. is again the world’s top oil
producer—almost 20% above the other two largest producers, Saudi Arabia and
Russia—and the world’s top natural-gas producer. The global oil market, which
was drowning in oversupply less than two years ago, has tightened dramatically
as the world emerges from Covid shutdowns. That makes the market vulnerable
to crisis. Russia’s push on Ukraine, a rebounding global economy, major weather
events, or a surprise event could send prices soaring.84
84. Yergin, “America Takes Pole Position on Oil and Gas,” Wall Street Journal, February 14, 2022.
2305CP_NOIA.indd 63 4/28/23 6:09 PM

FIGURE 15
As a component of national security, domestic energy production should always be

a priority. U.S. Gulf of Mexico oil and gas production reinforces our energy security
and strengthens America. On the other hand, eliminating or reducing opportunities
for leasing will lead to energy scarcity, energy insecurity, and a weakening in our
national security.
This point was highlighted by Martin Dempsey, the Chairman of the Joint Chiefs of
Staff during a Congressional hearing, “An energy independent [U.S.] and net exporter
of energy as a nation has the potential to change the security environment around the
world — notably in Europe and the Middle East.”85 This is eminently apparent today in the
wake of Russia’s unprovoked invasion of Ukraine and the associated consequences of
Russia’s using energy as a geopolitical tool.
85. General Martin Dempsey, Chairman of the Joint Chiefs of Staff, House Subcommittee on Defense Appropriations
Hearing, 2014
2305CP_NOIA.indd 64 4/28/23 6:09 PM

Photo 1311828504 © imaginima | Dreamstime.com
THE GULF COAST’S
ROLE IN THE EMERGING
U.S. OFFSHORE
WIND INDUSTRY
The role of the offshore energy industry goes well beyond oil and gas, with the industry
leading investment and advancing technologies in zero and low carbon projects
such as offshore wind, carbon capture and storage, and hydrogen, among others.
Companies in the offshore sector have the engineering expertise and experience, along
with the capital resources, to scale and deploy the major projects that will help reach
decarbonization goals.
Offshore wind projects are vital to the economic growth of this country and efforts
to meet climate goals for the 21st century and beyond. According to analysis by the
American Clean Power Association, we have an over $120 billion market off America’s
2305CP_NOIA.indd 65 4/28/23 6:09 PM

coasts for wind, including in the Gulf of Mexico. As detailed in that report, forecasted
potential lease sales in the Gulf of Mexico may raise as much as $282.8 million in auction
revenue and yield as much as 2,400 MW of power, assuming at least two awarded leases
of sufficiently sized areas in the initial Gulf of Mexico wind lease sale.
While the development of U.S. wind opportunities will provide substantial benefits
to the states adjacent to lease areas, it will also lead to tremendous investment
throughout the nation. In areas like the Gulf Coast, you will find steel fabricators,
offshore service vessels, heavy lift vessel operators, subsea construction companies,
helicopter service providers and more who built their experience in the oil and gas
industry but will be vital in building offshore wind. A generation of Louisianan, Texan, and
other Gulf Coastal marine, oil and gas service companies have already begun applying
their skills and experience to building a new renewable American energy industry in
offshore wind.
The U.S. is also taking steps to become a floating wind leader. Due to its deep water
depths, Pacific Coast projects will require floating wind farms to tap their wind
resources. Floating wind technology is still young, despite the expectation that most
future offshore wind resources could well be located in deepwater. Two-thirds of
America’s offshore wind energy potential, including along the Pacific Coast and in
the Gulf of Maine, are in deepwater areas. While the world’s first floating wind farm,
Equinor’s Hywind Scotland offshore Scotland, began operations in 2017, more are in
the global pipeline and this presents an advantageous opportunity for the American
market. The U.S. federal government is pursuing a “Floating Offshore Wind Shot”
project, to accelerate breakthroughs across engineering, manufacturing, and other
innovation areas.
U.S. oil and gas companies active in the Gulf of Mexico can deliver the engineering
expertise developed through floating projects over the past several decades in support
of the offshore wind floating market, and many are already playing such a role. By being
in the floating wind game sooner rather than later, the American offshore wind sector is
in a strong position to be a global leader.
2305CP_NOIA.indd 66 4/28/23 6:09 PM

Photo 93521845 © Pichit Boonhuad | Dreamstime.com
THE GULF’S CENTRAL
ROLE IN OFFSHORE
CARBON CAPTURE
AND STORAGE
Progress towards addressing the climate challenge will depend upon increased
innovation, conservation, efficiency, resiliency, mitigation, and adaptation. Carbon
capture and storage (CCS) is an innovative approach to mitigating greenhouse gas
emissions. The wide-spread deployment of CCS will be critical for achieving the
climate change ambitions and goals that have been established by a diverse group
of stakeholders around the world. CCS can serve as an important tool for balancing
environmental, economic, and energy needs. U.S leadership in CCS will help ensure the
availability of abundant, reliable, and affordable domestic energy, while continuously
driving down emissions.
What is CCS?: As its name suggests, CCS involves the capture of CO2 from either large
point sources – including power generation or industrial facilities – or directly from
the atmosphere. The captured CO2 is then compressed and transported to either be
injected into deep geological formations which permanently trap the CO2 or is used
in a range of applications. CCS uses a robust supply chain and combines various
2305CP_NOIA.indd 67 4/28/23 6:09 PM

technologies to effectively reduce the amount of carbon dioxide that is emitted into
the air, thus mitigating against warming effects and the impacts of greenhouse gases in
the atmosphere. Carbon dioxide is the most common greenhouse gas and it is emitted
through various activities, including industrial processes and the transportation sector,
among others. Industrial processes include emissions from power plants, industrial
furnaces and stoves, steel blast furnaces, cement plants, and others.
Capture: Through CCS, CO2 is captured from industrial processes by separating the CO2
from other gas within the stream of emissions. There are four methods for separating
CO2 from other gas during industrial processes, including absorption, adsorption,
membranes, and cryogenic processes. The oil and gas industry has extensive
experience in separating CO2 from hydrocarbons and is uniquely positioned to deploy
capture technologies. The Gulf Coast with its network of industrial centers and facilities
presents a significant opportunity for carbon capture.
Transport: Once captured, it will generally be necessary to transport the CO2 to the
location where the CO2 will either be stored or used. Pipelines are recognized to be
the most cost-effective means for transporting CO2. Prior to shipment by pipeline,
the CO2 is converted into a fluid so that the CO2 can be pumped like other liquids for
ease of transportation. Other methods of transportation include railcars, trucks, ships,
and barges. The Gulf Coast with its robust network of pipelines and energy transport
expertise is well situated for the transport of CO2 for use or storage.
Use: While the prevalent application of CCS may be permanent storage, there are
other valuable commercial uses for CO2. This includes the application of technologies
to convert CO2 into products like fuels, chemicals, and materials. This is accomplished
through chemical reactions or biological conversions such as thermochemical CO2
conversion, electrochemical and photochemical CO2 conversion, carbon mineralization
of CO2, and biological CO2 use. The conversion of CO2 to useful products presents
a tremendous technological opportunity for future maturation and growth. Also, a
common application for CCS today is for enhancing oil recovery (EOR) by injecting
CO2 into oil-bearing reservoirs for increasing oil production. Some of the injected CO2
remains trapped—or stored—within the formation, while some of the CO2 is recovered
with the produced oil and reinjected into the same formation for storage. EO
Storage: CO2 storage involves the injection of CO2 into subsurface geologic formations
either onshore or offshore. Subsurface geologic formations must have sufficient pore
space to hold CO2 (defined as porosity) in commercial quantities, as well as pathways
within the pore space (defined as permeability) so that the CO2 can be injected
throughout the storage reservoir. This is known as porosity and permeability. The
formation must also have a seal of non-porous, impermeable rock to prevent the CO2
from escaping the formation. Finally, the formations must be at the appropriate depths
to ensure effective and efficient storage. The Gulf of Mexico, in waters under both
2305CP_NOIA.indd 68 4/28/23 6:09 PM

state and federal jurisdiction, presents a significant CO2 storage opportunity because
of its recognized geologic capacity for long-term storage of CO2 (i.e., high porosity, high
permeability, and a good seal to maintain containment).
According to the National Petroleum Council (NPC):
CCUS is an essential element in the portfolio of solutions needed to change

the emissions trajectory of the global energy system. In its Fifth Assessment
Report, the IPCC concluded that the costs for achieving atmospheric CO2 levels
consistent with holding the average global temperature to 2 degrees Celsius—
referred to as a “2-degree Celsius world”—will be more than twice as expensive
without CCUS.
Meeting the Dual Challenge: A Roadmap to At-Scale Deployment of Carbon Capture,

Use, and Storage, December 2019, p. 12, Volume 1, Report Summary
According to the International Energy Agency:
Carbon capture, utilisation and storage (CCUS) technologies offer an important

opportunity to achieve deep carbon dioxide (CO2) emissions reductions in key
industrial processes and in the use of fossil fuels in the power sector. CCUS
can also enable new clean energy pathways, including low-carbon hydrogen
production, while providing a foundation for many carbon dioxide removal (CDR)
technologies.
See https://www.iea.org/reports/the-role-of-co2-storage
The U.S. currently stands as a global leader in CCS, with 10 of the 19 worldwide projects
operating and located in the U.S. in 2019. While most projects to date have included an
EOR component, the U.S. is well-positioned to lead in CO2 storage as well. According to
the National Petroleum Council, the U.S. has become a world leader in CCS by:
■ Executing successful CO2 capture projects

■ Investing in CO2 pipeline infrastructure
■ Establishing a supporting regulatory framework
■ Enacting world-leading policy support
■ Investing in research, development, and demonstration
As it relates specifically to the offshore, the NPC concluded that “One of the largest
opportunities for saline formation storage in the United States can be found in federal
waters, particularly in the Gulf of Mexico.” Meeting the Dual Challenge, p. 27. This is also
true as it pertains to state waters along the Gulf Coast.
The technical and commercial feasibility of large offshore storage projects is being
proven on the global stage. The first large-scale CO2 capture and injection project with
2305CP_NOIA.indd 69 4/28/23 6:09 PM

dedicated CO2 monitoring and storage was commissioned at the Sleipner offshore
gas facility in Norway in 1996. Today, the facility has stored more than 20 Mt CO2 at 1
km depth under the North Sea. With operations beginning in 2024, Northern Lights is
a new CCS project under construction that will initially store up to 1.5 million tonnes of
CO2 per year with the goal to achieve five million tonnes of CO2 per year by 2027. The
Northern Lights project is part of a larger carbon capture and storage initiative that will
capture CO2 from industrial sources within Norway, ship liquid CO2 from capture sites to
an onshore terminal on the coast, and then transport the CO2 by pipeline to an offshore
storage site below the North Sea in water depths of more than 300 meters and total
depth to injection of 2,500 to 3,000 meters. In the U.S., the Gulf of Mexico is well suited
for the development of projects like Northern Lights.
The U.S. Gulf of Mexico offshore region provides tremendous advantages for an
emerging U.S. CCS sector. The Gulf of Mexico is characterized by vast geologic
prospects for CO2 storage, extensive and established energy infrastructure along the
Gulf Coast and throughout the outer continental shelf, a proximity to industrial centers
for capturing emissions, and an assessable engineering and energy knowledge base and
workforce, along with associated RD&D capabilities.
The Gulf Coast region is distinctly situated to emerge as a global hub for CCS. The
Gulf Coast is home to the full supply chain of energy companies with the engineering
experience, expertise, and vision to deploy CCS projects with the scale and efficiency
necessary for success. As with any capital-intensive industry, the U.S. CCS sector
requires certainty and predictability in the regulatory system, both at the state and
federal level. Improvements must be made in U.S. laws and regulations to foster growth
and enable success in U.S. CCS. Federal policy requires a new level of urgency for
permitting of energy projects like offshore CCS. Otherwise, we will lose out on the
investments and the chance to emerge as a global leader in new energy solutions.
2305CP_NOIA.indd 70 4/28/23 6:09 PM

Photo 887483630 © nielubieklonu | gettyimages.com
CONCLUSION
The benefits of U.S. offshore energy development are vast. With more than $120 billion
flowing to the federal treasury since 2000 to support the LWCF, urban parks, and
national parks, and with more than 300,000 jobs supported annually, the U.S. Gulf of
Mexico positively contributes to communities while at the same time producing among
the lowest carbon barrels in the world.
Energy affordability is fundamentally and directly tied to the supply and demand of
energy sources. The offshore sector will be a key part of the solution for near- and
long-term affordability of oil, natural gas, and other energy sources for decades to
come. Furthermore, the diverse ecosystem of companies that team up to produce low
carbon barrels of oil from the Gulf of Mexico continues to innovate incredible solutions
for addressing the climate challenge. Emerging segments such as offshore wind
and carbon capture and storage can supercharge our nation’s response to meeting
ambitious climate change emissions targets.
The Washington Post Editorial Board sums up the reason for continuing investment in
our offshore oil and gas sector86:
We have long supported opening more U.S. waters to offshore drilling. As long as
the economy requires oil, it must come from somewhere, and better the United
86. https://www.washingtonpost.com/opinions/is-ryan-zinke-cynical-or-incompetent/2018/01/24/80055fd0-0146-11e8-
8acf-ad2991367d9d_story.html
2305CP_NOIA.indd 71 4/28/23 6:09 PM

States than a country with much weaker environmental oversight. It is arrogant
of Americans to benefit from the interconnected global oil market yet insist their
shores remain closed.
—Washington Post Editorial Board, January 18, 2018 [emphasis added].
We need to look no further than the U.S. Gulf of Mexico to achieve our national policy
goals. However, the U.S. offshore competes with other regions throughout the world for
investment in energy producing projects. Historically, the U.S. has been able to compete
effectively under its statutory and regulatory framework. However, that certainty and
predictability has continued to erode due to bureaucratic red tape and a continued
barrage of lawsuits against U.S. projects. We must work together to advance real-world
solutions that unlock affordable, reliable, and environmentally responsible energy while
bringing low and zero carbon technologies and energy to reality. Whether it is offshore
oil and gas, offshore wind, or offshore CCS, the federal government must provide a
pathway for investment through certainty in leasing, permitting, and regulation. Failure
to do so will not prevent the investment, it will only prevent the investment from
occurring in here in the U.S.
Photo 1467340785 © Arseniy45 | gettyimages.com
2305CP_NOIA.indd 72 4/28/23 6:09 PM

■ PARTNER PROFILE
EXMAR Offshore
Specializing in the engineering, design,
construction, installation and operation of
semisubmersible production platforms in the
Gulf of Mexico and offshore infrastructure
throughout the world
EXMAR Offshore is the Houston-based engineering

services and project development branch of the Belgian
Exmar NV Group. While other branches provide shipping
and offshore gas infrastructure services, EXMAR Offshore
is a multi-disciplinary maritime and offshore solutions
and King’s Quay projects. Under construction is Beacon
provider, designing and delivering sustainable, efficient
Offshore Energy’s Shenandoah FPS. As FPS hull experts,
and increasing value to its customers worldwide for oil
EXMAR was contracted to perform engineering and
and gas production, LNG liquefaction and regasification,
design for the upgrade and life extension of an existing
storage, and transportation.
FPS for the LLOG operated Salamanca development.
Proven Performance for Gulf of Mexico Assets

Committed to the Gulf of Mexico
EXMAR Offshore was established in 1997. Anticipating
EXMAR Offshore has provided over 25 years of dedicated
a need for reliable, standardized, low-cost deepwater
service to clients in the Gulf of Mexico, offshore US
production solutions, EXMAR Offshore developed its
and Canada , and worldwide. As the offshore industry in
proprietary OPTI® series of production designs starting
the Gulf of Mexico continues to weather extremes and
in 2001. Ever since, the company has secured a global
economic cycles, EXMAR Offshore stands ready with
reputation as a safe, cost-effective provider of proven
technical expertise and design innovations that promise
designs and execution strategies for floating production
optimized asset performance for decades to come.
systems (FPS).
Supporting NOIA Advocacy

Innovative Floating Production Solutions
EXMAR Offshore is fully supportive of NOIA’s role in
In 2006, the company introduced its OPTI®
uniting and advancing the interests of the offshore energy
semisubmersible—a FPS optimized for motion, weight,
industry and for promoting solutions that provide the
design, and execution. The OPTI® was conceived as a
energy vital for lifting society in a safe and environmentally
standard hull product with a repeatable execution plan
sustainable way.
but adjustable to client preferences. Its scalability makes
it ideal for many offshore applications from oil and gas
production to renewable power generation. Rather than
reinventing the wheel with each new project, OPTI®
FPS designs provide a standard, scalable, low-cost
solution, and leverages significant and uninterrupted
execution experience. 3700 W. Sam Houston Parkway South
Suite 300
Installed projects include production platforms for LLOG’s Houston, Texas 77042
Who Dat development, and Murphy Oil’s Delta House www.exmaroffshore.com
2305CP_NOIA.indd 73 4/28/23 6:09 PM

■ PARTNER PROFILE
bp
An integrated producer of resilient
hydrocarbons in deepwater Gulf of Mexico
at a lower cost and with fewer emissions
bp is proud of our 150-year history in the United States

and remains committed to providing customers with
the energy they need as we transform the company to
reach net zero emissions by 2050 or sooner. In 2020, bp
Thunder Horse – bp’s largest offshore asset in the GoM
set our net-zero ambition and a new strategy to become
an integrated energy company. In February 2023, bp
announced that we expect to increase the proportion of In support of NOIA
capital expenditure by 2030, by investing $8 billion more As we move forward in the Gulf of Mexico, bp supports
into today’s oil and gas system, and an additional $8 billion NOIA’s role in furthering the interests of the offshore
more into our transition growth engines. energy industry and for promoting solutions that
provide vital oil and gas production through safe and
Investing in the Gulf of Mexico environmentally sustainable processes.
bp is one of the largest oil and gas producers in the
deepwater Gulf of Mexico. We currently operate five
deepwater production platforms in the region: Atlantis,
Mad Dog, Na Kika, Thunder Horse and most recently,
Argos. In April 2023, bp announced the start-up of
production at the Argos platform–a semi-submersible,
floating production platform–which is bp’s fifth
operated platform in the Gulf of Mexico. We’re aiming
to find oil and gas that we can produce at lower cost
and with fewer emissions by developing projects close
to existing infrastructure. We’re changing how we do
things by applying agile ways of working and using digital
technologies that enable our people to safely make faster,
smarter decisions.
bp expects to increase production in the Gulf of Mexico

to around 400,000 boe/d by the mid-2020s, and average
350,000 boe/d through the end of the decade. Through ▲
Argos – the 5th bp-operated
investments in technology and infrastructure, we also
platform in the GoM
expect to cut emissions which will be essential to helping
us achieve our net zero ambition, while generating the
cash flows that will allow us to further invest in the
energy transition. ▶
Inside the control
room at Argos
Emphasis on production safety
bp’s Remote Collaboration Center in Houston uses
leading-edge technology to create a collaborative
real-time environment. The center is devoted entirely
to ensuring the safety of our people and protecting the
environment. Specialists at the facility are in constant
communication with offshore teams to monitor and bp America Inc.
analyze real-time data, focusing on pumps, pits, flow rates 501 Westlake Park Blvd.
and pressures. We believe that technology can play an Houston, TX 77079
increasingly effective role in reducing safety risks. www.bp.com
2305CP_NOIA.indd 74 4/28/23 6:09 PM

■ PARTNER PROFILE
MSRC
The largest oil spill removal organization
(OSRO) in the United States consistently
provides reliable, effective oil spill response
For more than thirty years, the Marine Spill Response

Corporation (MSRC) has consistently delivered reliable
oil spill removal services to our customers across the oil
and gas industry. MSRC’s robust spill response capability
is supported by monthly readiness and preparedness
training activities and is fully funded by our oil and gas
customers through dues paid to the Marine Preservation
Association (MPA). Relying on this operating grant rather
than on revenue from spill activity incentivizes MSRC to
prioritize efficiency and effectiveness when responding Demonstrated Success
to an event. Responsible oil and gas operators know that MSRC has never failed to respond effectively to a spill
they can rely on MSRC’s decades of real-world response incident. Our operating profile positions us to activate
experience and our industry-leading expertise to equipment and personnel efficiently and effectively,
provide credible and reliable response when unexpected delivering the right combination of response tools to
incidents and emergencies occur. a response scenario. We have played a pivotal role in
numerous oil spill events for our customers and the USCG,
Spill Response and our experience includes over 1,000 spill responses
MSRC is response ready for oil spills of all sizes since our founding in 1990.
across the continental U.S., Hawaii, and Puerto Rico.
Notable recent responses include:
Our dedicated spill response equipment portfolio is
- Deepwater Horizon event in 2010, for which MSRC
strategically allocated along coastal areas and includes
was the largest single OSRO to respond, with over
50+ oil spill response vessels, 10+ oil spill response
15,000 employee man days, including over 11,000 man
barges, 60+ shallow water barges, 500,000+ feet of
days offshore;
boom, 650,000+ barrels of storage, and nearly 1.5 million
- USCG activation to respond to a barge explosion in
barrels of skimming capacity. In addition, MSRC
Aransas Pass, TX in 2017;
maintains a robust portfolio of alternative technologies
including 22,500 feet of pyro-boom, two Boeing 737 - USCG activation to respond to a tank farm fire in the
dispersant jets, and 190,000 gallons of dispersant Houston, TX, Ship Channel in 2019;
for surface application. Our highly-trained team of - Subsea pipeline release offshore Huntington Beach,
300+ response personnel maintains this response CA, in 2021.
equipment in excellent condition. MSRC’s dedicated
national capability is augmented by a vetted and trained Supporting NOIA
nationwide contractor network of over 220 sites ready MSRC is an active NOIA member and is fully supportive of
to activate to support response efforts. NOIA’s mission to advance the interests of the Gulf Coast
offshore industries in the safe, sustainable production
Our remote sensing and surveillance portfolio employs
and delivery of offshore energy.
sophisticated sensor packages mounted on a variety
of airborne platforms, including fixed-wing aircraft,
aerostat balloons, and utility drones, to identify
and track thick, recoverable oil on water using HD,
TIR and multispectral imaging systems. To address
communications challenges in remote areas or following
a natural disaster, we maintain a broad communications
capability that can establish wifi and telephone
connectivity through a variety of technologies supported www.msrc.org
by full-time, trained technicians. customer.service@msrc.org
2305CP_NOIA.indd 75 4/28/23 6:09 PM

■ PARTNER PROFILE
Quality Companies
A portfolio of top-tier oil and gas product Quality Production Management. We provide premier
operation management services within the continental
and service companies Internationally
United States. Our production operation management
recognized for offshore and onshore division offers contract operations services, incorporating
construction, fabrication and electrical and all land operations and logistics coordination. Our services
instrumentation with a global reach include contract operations, supplemental labor, E&I/
electrical/compliance technicians, deepwater/shelf/state
water/land operations, plant/pipeline operations, and
contract/supplemental transport.
Traco Production Services Inc. As a leader in general

fabrication and production services, Quality Companies
offers an array of new or refurbished production
equipment, separators, safety system panels and more
to the upstream, midstream and downstream sectors.
Committed to oil and gas service, we additionally provide
maintenance to a variety of equipment pieces.
Qualco Inc—Guyana. Qualco Inc. is an international

leader that has a strong local content presence in Guyana.
Our company provides electrical and instrumentation,
fiber optic, NDE testing and inspection, fabrication,
modifications and specialty access services to the
energy sector.
Safety Mindset
At Quality Companies, the health and safety of our
employees, and protection of the environment is a core
value to us. We promote a Target Zero mindset, with
a strong focus on customer satisfaction and quality
performance throughout the company. We promote a
Quality Companies is a consortium of premier oil strong Stop Work Authority (SWA) Program designed
and gas product and service companies strategically to empower all employees and contract workers with
located throughout the Gulf Coast region and beyond. the responsibility and obligation to cease work when
Five industry-leading entities make up the Quality an unsafe condition or behavior is observed. As part of
Companies family: our concerted effort to improve and maintain safety in
all we do, Quality Companies received recognition from
Quality Construction & Production. Quality Companies American Equity Underwriters Inc. (AEU) as a 2022 AEU
leads the way in onshore and offshore fabrication, Safety Award winner.
construction, and maintenance with highly skilled
personnel and quality service offerings for the domestic
Support for NOIA
and international oil and gas industry. When it comes
Quality Companies is proud to be a NOIA member and
to construction, production, and maintenance, Quality
supports the industry organization in its efforts to
Companies offers the finest along the Gulf Coast, with
strengthen the oil and gas industry’s presence in the
specializations in composite wrap, blasting & painting,
Gulf of Mexico.
scaffolding, production and mechanical services,
and equipment.
Zadok Technologies Inc. Whether offshore or onshore,

Zadok Technologies, Inc. is an international leader in
425 Griffin Road
electrical and instrumentation, testing and inspection, Youngsville, LA 70592
fabrication, and telecommunication services to the global Tel: 337-857-6000
energy industry. www.qualitycompanies.com
2305CP_NOIA.indd 76 4/28/23 6:09 PM

■ PARTNER PROFILE
Oceaneering
Global technology company delivering We deliver cost efficient, safe, and low-carbon solutions,
from survey operations to the design and manufacture of
engineered services and products to the
dynamic inter array cables, cable repair support, and route
energy, defense, aerospace, manufacturing, clearance and preparation.
logistics, and entertainment industries
Innovation
Oceaneering has been committed to the Gulf of Mexico We are powering the energy transition with advancements
(GoM) since its founding nearly 60 years ago. We serve our including our autonomous Freedom™ AUV for site
GoM customers with facilities in Houston, Morgan City investigations, high-speed Isurus™ ROV for operating in
and Port Fourchon, Louisiana, and Panama City, Florida. harsh current conditions, our Integrated IMR offering,
cost- and carbon-reducing suction anchors, and Ocean
Serving GoM renewable energy market Perception™ marine mammal monitoring software. Our
With a decade of experience in renewables, we leverage recent collaboration with Kontiki Winds will enable us to
our fleet of Jones Act-compliant vessels and work class support the electrification of offshore assets and island
ROVs to serve our customers’ complex challenges. states using floating wind.
Supporting the NOIA and Sustainability

Oceaneering supports NOIA’s mission of advancing a
dynamic and growing offshore energy industry, providing
solutions that support communities and protect workers,
the public, and our environment.
Oceaneering International, Inc.

5875 N. Sam Houston Parkway West
Suite 400
Houston, Texas 77086
Tel 713 329 4500
www.oceaneering.com
PUBLISHED BY
ENDEAVOR BUSINESS MEDIA, LLC

CEO Chris Ferrell
GROUP PUBLISHER Diana Smith
dsmith@endeavorb2b.com PRESIDENT June Griffin
VP, CUSTOM PUBLISHING Roy Markum CFO Mark Zadell
rmarkum@endeavorb2b.com COO Patrick Rains
PETROLEUM GROUP
WRITER, PARTNER PROFILES Pramod Kulkarni CRO Reggie Lawrence
757 North Eldridge
pramodhk2000@gmail.com CHIEF ADMINISTRATIVE and LEGAL OFFICER Bldg. 2, Suite 8D
ART DIRECTOR Meg Fuschetti Tracy Kane Houston, Texas 77079
PRODUCTION MANAGER Josh Troutman EVP INDUSTRIAL GROUP Mike Christian 713.621.9720
2305CP_NOIA.indd 3 4/28/23 6:09 PM

Society can reach ambitious emissions reduction targets
through American offshore energy.
The National Ocean Industries Association (NOIA) members are leading the
development and deployment of climate change solutions and GHG emission
reductions. From responsibly developed oil and gas in the Gulf of Mexico to rising
offshore wind to emerging energy segments, such as carbon capture and storage,
NOIA members are transforming the global energy landscape.
Through initiatives like the NOIA Environmental, Social & Governance Network, NOIA
unites the interests of the entire offshore energy ecosystem.
We encourage you to join NOIA today. Together, our voice will successfully promote
the durable energy solutions so vital for lifting society in a safe and environmentally
sustainable way.
National Ocean Industries Association: Become a member and join

the voice of the offshore industry today!
TO LEARN MORE VISIT NOIA.ORG
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May/June 2023

WORLD TRENDS FOR OIL, GAS & RENEWABLE ENERGY

DRILLING RIG MARKET UPDATE

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Exploring the Future of

22 Production data underpins successful

12 Top 10 offshore rig managers

18 Seismic survey market finally recovering

COVER: The deepwater, harsh-environment

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the offshore energy industry

32 Autonomous drone technology

33 Transforming offshore operations: The

rise of autonomous inspection robots

35 Executive insights: Remote operations

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Oil, gas investment is core

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which has slowed 2023 contracting activity

Vessel supply to fall short Turbine demand & supply forecast

of results for the first three months of the year. 30%

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Overcoming unfavorable conditions

COURTESY ADVANCED NAVIGATION

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Arrival of eighth-generation drillships to the

Offshore: Can you talk about how these

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bp affirms commitment to Gulf of Mexico with

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Top 10 offshore rig

China Oilfield Services Ltd

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F L E E T B Y R I G S TAT U S FLEET BY REGIONAL SPREAD

OTHER UNDER TOTAL LATIN NORTH SEA/ WEST MIDDLE ASIA-

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A TALE OF TWO NORTH SEAS:

Global demand for harsh environment

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