Guest “He Fights The Law And The Law Won,” by David Middleton
A few days after the climate talks, the US holds a huge crude oil sale in the Gulf of Mexico
By – Matthew Brown, Associated Press
By – Janet McConnaughey, Associated Press
Economics November 16, 2021 6:30 p.m. ESTNEW ORLEANS (AP) – The U.S. Department of the Interior on Wednesday will auction off vast oil reserves in the Gulf of Mexico, estimated to hold up to 1.1 billion barrels of crude, the first such sale under President Joe Biden and heralded the challenges he faces. Achieving climate goals depends on deep cuts in fossil fuel emissions.
The live-streamed purchase will invite energy companies to bid for drilling leases across about 136,000 square miles (352,000 square kilometers) – about twice the size of Florida.
It will take years to develop the lease before companies start pumping crude. That means they can resume production long after 2030, when scientists say the world needs to be on track to cut greenhouse gas emissions to avoid catastrophic climate change. fierce.
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The auction comes after a federal judge in a lawsuit brought by Republican states overturned a fossil fuel sales suspension that Biden had imposed when he first took office.
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A few points:
- There are no “reserves” to be auctioned.
- This bit is hilarious:
That means they can resume production long after 2030, when scientists say the world needs to be on track to cut greenhouse gas emissions to avoid catastrophic climate change. fierce.
Larry the Cable Guy would say:
OCS 257 discount was held today. This is the first lease in the Gulf of Mexico since the current White House occupant unlawful cessation of Federal rental sales a few days after his bad deed.
About 300 leases have received tenders, mostly for deep water areas.
Curiously, ExxonMobil submitted bids on 94 blocks on the shelf (shallow water). My hunch is that ExxonMobil bidding in the Brazos, Galveston and High Island areas has something to do with this…
ExxonMobil’s Oswald Endorses CCS Center in Houston
FOLLOWING NANCY FORD November 16, 2021 10:52 AMThe need to reduce carbon emissions and prevent its harmful effects on the health of the planet is one of the key drivers of the “energy transition”.
Eric Oswald, vice president of strategy development and advocacy for ExxonMobil’s Low Carbon Solutions business, said energy transition is a term used differently by different people.
“A lot of markets are talking about greenhouse gas emissions,” notes Oswald. The Houston market, he said, is “interested in greenhouse gas emissions, but we are also interested in helping Houston win the energy transition.”
A Houston-based carbon capture and storage (CCS) hub will push Houston to win that transition, he said.
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The project expects about 100 million tons of CO2 to be captured each year, Oswald said. A project of that size requires the cooperation and companionship of industry, government, and the community at large.
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The leases are located in three offshore clusters, where the main petrochemical plants and refineries are located. The High Island and Galveston island clusters lie along the boundary between Confederate waters and Texas. The Brazos star cluster is a little further offshore. All three clusters are well positioned to take advantage of the huge Miocene saltwater aquifers with thick seal layers on marine shale. I wouldn’t be surprised if ExxonMobil lobbied the Federal government to convert these oil and gas leases into CCS concessions.
There’s something even more hilarious in the AP article:
Environmental assessments of the Gulf of Mexico purchase conducted under former President Donald Trump and confirmed under Biden have reached an unlikely conclusion: Extracting and burning fuel will produces less greenhouse gases than leaving it in the ground.
Similar claims in two other cases, in Alaska, were dismissed by federal courts following challenges from environmentalists. Climate scientist Peter Erickson – whose work was cited by the judges in one of the cases – said the Home Office’s analysis had one glaring shortcoming: It eliminated an increase in greenhouse gases in foreign countries, so there will be more Gulf oil on the market.
“The math is incredibly simple for this kind of stuff,” said Erickson, a senior scientist with the Stockholm Environment Institute, a non-profit research group based in Sweden. “If new leases expand the global supply of oil, that has a proportional impact on emissions from burning oil. Therefore, leasing these contracts in the Gulf of Mexico would increase global emissions.”
The original conclusion is correct. U.S. Gulf of Mexico deepwater oil production has a “carbon footprint” per barrel of oil produced that is smaller than all but one major oil producing/producing region.
Could US Gulf of Mexico oil production curbs lead to a carbon leak?
Federal actions have brought the comparative emissions performance of the prolific U.S. Gulf of Mexico into focusBy Mark Oberstoetter, Head of Upstream Americas Research (non-L48), and Mfon Usoro, Senior Research Analyst, United States Upstream Gulf of Mexico
April 12, 2021
As one of the few major oil-producing regions under federal concern, the Gulf of Mexico appears to be a focal point of President Biden’s efforts to swiftly deliver on campaign promises. But while rental is prohibited and increase royalties Signaling swift action on the energy transition, federal actions have consequences – and they can be global.
An important and unintended consequence of enacting more restrictive policies such as a rental ban or tax rate hikes in the Gulf of Mexico is that it could generate carbon leaks for crude exporting countries. to America. Carbon leaks occur when greenhouse gas emissions from industrial production are moved outside of one regulated area to another with weaker emission restrictions.
Despite the growth in domestic production, the US still imports six million barrels of crude oil per day from abroad. If output from the Gulf of Mexico falls, that number is likely to increase dramatically. Total emissions will then depend on regulations and controls in the countries where that oil is imported. Climate change is a global problem by its nature and eliminating or limiting a low emission factor would hurt the overall global average.
How concentrated is the US Gulf of Mexico in emissions?
U.S. Gulf of Mexico deepwater emissions are less intensive than all but one importing country: Saudi Arabia. And more than half of the region’s 2021 production will come from an existing public company with zero commitment.
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The world will not consume less oil if Biden succeeds in reducing oil production from the Gulf of Mexico. It will only consume more oil produced from other basins and plays. More than two-thirds of the bids were for deepwater bodies, given their very low “carbon footprint”. Most of the bids are close to existing infrastructure and any discovery will likely be an undersea obstacle to existing production facilities. If ExxonMobil is really serious about setting up a massive 100 MTPA CCS facility in Federal waters, off the coast of Texas… The sale of this lease could just be “carbon neutral.” 100 MTPA CO2 sequestration would fully offset Scope 1, 2 & 3 emissions from about 200 million barrels of oil per year, about 550,000 bbl/d, about a third of GOM’s total average production in 2020.
“The math is incredibly simple for this kind of stuff,” said Erickson, a senior scientist with the Stockholm Environment Institute, a non-profit research group based in Sweden.
The math is extremely simple. Erickson has won the Ron White Lifetime Achievement Award.
About Biden losing his battle with the law… I think this is a perfect point for Skirmish…
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