American Oil and Gas Reporter - November 2016 - 22

IndustryDigest
vegetation and has eroded the coast. In
September, media reports note, Edwards
sought to hire a team of private lawyers
to help the state join the litigation, while
also encouraging Louisiana's other
coastal parishes to sue as well.
According to the Louisiana Oil &
Gas Association, on Sept. 30,
Terrebonne Parish President Gordon
Dove hand-delivered a letter to Edwards
that indicated the parish had no
intention of filing such a suit and also
urged the state and the Louisiana
Department of Natural Resources not to
sue on its behalf.
Dove's letter cites a number of
reasons the parish has determined such
litigation is not in its best interests,
including:
* The possibility of a costly defeat
or dismissal, especially considering that
Jefferson Parish and the South
Louisiana Flood Protection AuthorityEast already are appealing to the
Louisiana Supreme Court lower-court
dismissals of suits they brought;
* The threat the lawsuit poses to the
parish's economy; and
* The responsibility shared by other
parties, including loggers, trappers,
hunters, sugar-cane farmers and the
U.S. Army Corps Of Engineers, which
constructed levees on the Mississippi
River that "halted the freshwater and
natural sediment deposits."
Although the letter thanks Edwards
for his work regarding hurricane
protection, coastal restoration and other
coastal issues, Dove calls on Edwards to
recognize the harm the lawsuit will do
to Terrebonne Parish's economy. Dove
notes that the parish's unemployment
rate has risen four points amid the
industry's slump and worries a lawsuit
will weaken small companies and scare
away large ones.
Dove, a retired Louisiana legislator
who sat on the House Natural Resource
and Environment Committee for 12
years, including eight as chairman,
highlights the early August action by
24th Judicial District Court Judge
Stephen Enright to dismiss Jefferson
Parish's case.
"The Jefferson Parish lawsuit was
dismissed based on the failure to
exhaust administrative remedies prior to
filing suit," Dove's letter observes.
"Judge Enright found that a
comprehensive administrative remedy
exists under the State and Local Coastal
Resources Management Act of 1978
22 THE AMERICAN OIL & GAS REPORTER

and the Louisiana Administrative Code
to address potential violation of coastal
use permits. The court states that 'in the
absence of an exhaustion of
administrative remedies, it is yet to be
determined whether civil damages
exist.' Accordingly, the court held that
Jefferson Parish and the intervenors
must pursue and exhaust this
administrative remedy process prior to
bringing suit in court seeking civil
damages." ❒

NOIA Seeks Information
On Decommissioning
Cost Estimates By BSEE
WASHINGTON-The National
Ocean Industries Association in October
sent a Freedom of Information Act
request to the U.S. Bureau of Safety and
Environmental Enforcement, seeking
information related to the agency's
revised estimates for well plugging and
abandonment, and platform
decommissioning costs in the Gulf of
Mexico.
NOIA says the information is
important because the Bureau of Ocean
Energy Management may be
incorporating BSEE's estimates into its
financial assurance requirements for
offshore operators. BOEM issued a
notice to lessees in July that industry
associations worry could double the
cost of insurance and force all offshore
facility owners to insure against 100
percent of decommissioning costs
(AOGR, August 2018, pg. 16).
"BSEE's estimates, particularly for
shallow-water facilities, appear to vary
wildly from current decommissioning
costs," NOIA states. "BSEE released
the revised estimates with little
explanation regarding the assumptions
and data it relied on, despite the fact the
agency's own projections for
decommissioning liability in the
shallow-water Gulf are more than 100
percent higher than estimates from as
recently as four months ago."
NOIA suggests BOEM's new
financial assurance requirements may
be based on the unrealistic assumption
that all of the more than 28,000 Outer
Continental Shelf leases could be
decommissioned at once, and on a
flawed government database with a
limited ability to accurately record
estimates of decommissioning

liabilities.
The association adds, "Actual costs
to perform decommissioning projects
have decreased dramatically because of
depressed commodity prices, better
equipment and execution by operators,
and a reduction of overall service
costs."
NOIA says its FOIA request
reinforces industry efforts to obtain
information vital to assuring
transparency regarding the
methodologies used to calculate BSEE's
revised estimates. ❒

Gas Storage Levels
Increase By 363 Bcf
WASHINGTON-Underground
natural gas storage in the United States
stood at 3.963 trillion cubic feet on Oct.
28, 4.6 percent above the five year
average, according to the U.S. Energy
Information Administration. That was
up 363 billion cubic feet from the 3.600
Tcf in storage on Sept. 28, which was
6.5 percent above the five-year average.
The Oct. 28 storage number was 48 Bcf
more than a year ago, when gas storage
stood at 3.915 Tcf.
According to EIA, gas storage in the
East Region was 940 Bcf on Oct. 28,
1.8 percent above the five-year average
and 66 Bcf more than on Sept. 28, when
storage stood at 874 Bcf, which was 4.4
percent above the five-year average.
East Region gas storage on Oct. 28 was
27 Bcf more than a year ago.
Gas storage in the Midwest Region
stood at 1.130 Tcf on Oct. 28, 4.4
percent above the five-year average and
116 Bcf more than the 1.014 Tcf in
storage on Sept. 28, which was 6.7
percent above the five year average.
Oct. 28 gas storage in the Midwest
Region was 40 Bcf more than a year
ago.
In the Mountain Region, EIA says,
gas storage was 249 Bcf on Oct. 28,
19.1 percent above the five-year average
and 16 Bcf more than the 233 Bcf
stored on Sept. 28, which was 20.7
percent above the five year average. Gas
storage in the Mountain Region was up
33 Bcf from a year ago.
Gas storage in the Pacific Region
was 326 Bcf on Oct. 28, 10.7 percent
below the five-year average, but 8 Bcf
more than the 318 Bcf stored on Sept.
28, which was 5.9 percent below the
American Oil and Gas Reporter - November 2016

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