Mexico reforms may make US offshore industries look south

September 28, 2017

Mexico’s continuing energy reforms could make US offshore oil and gas producers consider leasing there if more of the US Outer Continental Shelf is not opened for exploration and development, National Ocean Industries Association Pres. Randall B. Luthi told a Washington audience on Sept. 27.

“If the US doesn’t open more of its federal offshore areas, operators probably will start looking elsewhere, and areas that are closer may be appealing. This puts Mexico into a very interesting position,” he said during a panel discussion at the 2017 North America Energy Forum at the Woodrow Wilson International Center for Scholars.

Government regulations can provide consistency and certainty, but some which were imposed following the 2010 Macondo deepwater well blowout and crude oil spill went too far, according to Luthi, who previously directed the US Minerals Management Service from July 2007 through January 2009.

Noting that 94% of the US OCS is closed to oil and gas activity, he said that this created a heavy offshore oil and gas concentration in the central and western gulf. “The good news is that when Hurricane Harvey came through a few weeks ago and platforms were shut down, no oil and gas was spilled,” Luthi said. “But access elsewhere is denied not just geographically, but through regulations that make it impossible to go forward.”

A second panelist, Luis Angel Martinez-Montoya, chief advisor to Carlos Regules, executive director of Mexico’s National Agency for Industrial Safety & Environmental Protection of the Hydrocarbons Sector (ASEA), said the agency has emphasized workplace and environmental safety first in its stakeholder engagement efforts while trying to provide more regulatory certainty.

Since ASEA began to operate in 2015 it has tried to identify risks and find best practices to minimize them not only from other governments but also from oil and gas producers “because these can emerge...

Read entire article at Oil and Gas Journal.

 

 

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