The Future of Regulations for the Deepwater GOM

Abstract Deepwater oil and gas activities in the U.S. Gulf of Mexico Outer ContinentalShelf (OCS) are regulated by the Minerals Management Service (MMS). The levelof OCS deepwater activities in both the drilling and production arena has showna steady increase, and the discoveries in the deepwater tractshave begun tostack up. Very high rates of production by prolific deepwater wells haveconvinced operators that the deepwater Gulf of Mexico is a sound economicalinvestment, and the trend in this area is expected to increase. Regulatoryconcerns have been viewed by some as a potential barrier to deepwaterdevelopment successes, and in fact, existing OCS operating regulations havelargely been developed on the basis of the expansion of successful bay andinland estuary production activities. These regulations reflect mostly surfaceoperations where daily access to the wellhead(s) is usually possible. Onespecific concern is that the existing regulations do not adequately address thetechnology associated with the new deepwater hardware and operatingprocedures. Discussions with the industry consortium DeepStar and MMS'S active involvementwith the Regulatory Issues Committee have successfully provided an open forumbetween the regulators and operators to identify those regulatory andoperational issues that impact the industry, This paper will address theinteraction and the processes used to study the areas identified by both theregulator and industry personnel as needing attention. Specifically, the paperwill identify the parts of a deepwater operations plan and its use inevaluating the total deepwater production system. The contents of a typicaldeepwater operations plan and how it fits into the operator's project timingand the MMS'S current permitting process will also be summarized. Introduction Deepwater drilling activity is at an all-time high and production fromdeepwater reservoirs is also increasing MMS statistics indicate that the numberof rigs concurrently operating in water depths greater than 1,000 feet hasaveraged 16 during late 1995 and early 1996. In several instances the deepwaterrig count has increased to levels approaching 20 rigs. The continued growth ofthe deepwater Gulf of Mexico, especially the ultra-deep blocks, might beconstrained by the availability of drilling vessels capable of operating inthose water depths. Numerous trade journals have published articles about thesuccesses of GOM deepwater projects, lists of projects under development orwhich are pending, and water depth records for deepwater drilling, mooring, andinstallations. t.s, f We will not attempt to discuss these. The important pointis that the GOM offshore has seen a much needed revitalization with theexcitement of deepwater drilling and production, It is in everyone's bestinterest that the successes continue. Deepwater Regulation There are probably as many answers to the question 'How deep is deepwater?' asthere are responses, From an operations perspective, MMS considers deepwaterwith respect to regulating production activities as beginning where industryuses different technology to develop and produce oil and gas from the OCS.