National Niche
Rice’s whale habitat. A new federal law has made offshore wind development contingent on also offering oil and gas leasing rights. ****************************************************** Oil purchased by Biden Administration for the Strategic Petroleum Reserve On December 26, 2023, the U.S. Department of Energy’s (DOE) Office of Petroleum Reserves announced that contracts have been awarded for the acquisition of 3 million barrels (3MMbbl) of U.S.-produced crude oil for the Strategic Petroleum Reserve (SPR). According to a press release, the contracts awarded for a March delivery follow the Request for Proposal (RFP) that was announced on December 8, 2023. The 3 MMbbl, purchased for an average price of $77.31 per barrel, is significantly below the average of about $95 per barrel paid for SPR crude sold in 2022. Over the course of 2023, in line with its strategy to refill the SPR, DOE purchased a total of 13.83 MMboe for the SPR for an average price of $75.63, as well as accelerating nearly 4 MMbbl of exchange returns. After reviewing the competitive bids, contracts were awarded to three companies that met the necessary quality and spec requirements. Delivery of the crude oil to the Big Hill SPR storage site is scheduled to occur from March 1, 2024, to March 31, 2024. The SPR is the world’s largest supply of emergency crude oil. The SPR’s purpose is to protect the U.S. economy from severe petroleum supply interruptions through the acquisition, storage, distribution, and management of emergency petroleum stocks. It further serves to fulfill U.S. obligations under the International Energy Program (IEP). The IEP, a treaty in which the United States is a signatory, requires member countries to hold in reserve the equivalent of 90 days of net imports of oil and petroleum products. The SPR comprises 60 salt caverns along the Texas and Louisiana coastlines that
Offshore Oil spill An oil spill was detected in November 2023 about 19 miles offshore, near Plaquemines Parish, which is southeast of New Orleans. The U.S. Coast Guard was still investigating the original million gallon spill when a new “sheen” was spotted in December. The main pipeline and several surrounding lines were shut in after the initial leak while divers and remotely operated devices assess the pipelines in the search for the source of the spill. The Coast Guard has been working to mitigate the effects of the spill. ****************************************************** New U.S. Methane Rules On December 2, 2023, the Biden administration unveiled final rules aimed at reining in U.S. oil and gas industry releases of methane, as part of a global plan to curtail emissions that contribute to climate change. The rules were announced at the U.N.’s COP28 climate change conference in Dubai. At a Dubai news conference, U.S. Environmental Protection Agency Administrator Michael Regan stated, “These new standards will help us meet our international commitments to aggressively tackle climate change, while improving air quality for communities all across the country.” Addressing the conference, Vice President Kamala Harris said the methane rules are part of U.S. initiatives to combat global warming, stating “Today, we are demonstrating through action how the world can and must meet this crisis.” ****************************************************** Gulf of Mexico Lease Sale The December 20, 2023, lease sale raised over $380 million on offshore acreage in what was likely to be the last auction until 2025, according to the Biden administration’s 5 year schedule. The sale of more than 72 million acres included 6 million acres that the administration had tried to withdraw to protect
28
N at i onal A ssociation of D i v i s i on O rder A nalys t s
Made with FlippingBook Digital Publishing Software