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  • Regional Report - Gulf of Mexico: The difference a year can make as activity creeps toward pre-Macondo levels

    Justin Smith

    At this time last year, the United States government had awarded only a handful of deepwater drilling permits after the prolonged moratorium that followed the Deepwater Horizon disaster. Rigs and investment dollars had been leaving the Gulf of Mexico at a staggering rate during that period, but all was not lost. While it continues to move slowly, permitting is creeping toward pre-Macondo levels. The last two columns in the bottom half of Table 1 show that all but a few of the deepwater drilling permits awarded since the moratorium officially ended in October 2010 have actually come in the last 12 months. Although the industry had to wait for roughly five more months for the de facto moratorium to be lifted, at least now permitting is recovering. Yet, many people in the industry along the Gulf Coast would tell you that permitting is not moving fast enough. The Thibodaux, La.-based Gulf Economic Survival Team (GEST) notes that of the 745 so-called “permits to drill” approved post-Macondo, in water depths less than 500 ft, only 120 (16%) are actually for brand-new wells. Another 186 permits are for revised new wells that already had permits on the books. There are 113 permits for bypass or revised bypass wells, and the remaining 326 permits are for sidetracks or revised sidetracks. “[The government says] they have issued 233 permits since the moratorium was lifted,” GEST Executive Director Lori LeBlanc said. “That’s fine and dandy, but in the world we live in now, many wells require more permits than they’ve required in the past. Some wells could require five permits, so we’re not talking about 233 new drilling permits. We have been able to break it down to the point that as of Jan. 1, 2012, out of those 233 permits issued, only 22 were for what we term ‘unique new wells.’”

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2013 Fracturing Technology

2013 Fracturing Technology