Tag Archives: U.S. Gulf of Mexico

U.S. Gulf of Mexico auction attracts pent up demand from oil drillers

By Nichola Groom

(Reuters) -The Biden administration’s auction of oil drilling rights in the U.S. Gulf of Mexico generated more than $190 million in high bids, bringing in more money for taxpayers than any government offshore lease sale since early 2019.

The Department of Interior auction came days after the U.S. joined a global agreement that for the first time asked governments to accelerate emissions cuts by phasing down coal and fossil fuel subsidies.

It was the first auction under President Joe Biden, whose administration paused drilling sales under a promise to end development on federal properties. But Biden lost a court fight to oil-producing states that sued to reinstate the sales.

The sale’s total high bids – $191,688,984 — was announced by U.S. Bureau of Ocean Energy Management Gulf of Mexico Director Mike Celata on a live webcast. The bureau, an arm of the Interior department, had offered almost all available unleased Gulf of Mexico blocks, or 80 million acres. About 2% of that acreage, or about 1.7 million acres, sold.

The total high bids was far higher than the $121 million the government received at a sale held by the Trump administration a year ago, but the price per acre sold was around $112 compared with $233 at last year’s auction.

Major bidders included Exxon Mobil Corp, which snapped up nearly a third of the tracts for $14.9 million, and Chevron Corp, which was the auction’s biggest spender at with $47.1 million in high bids. Anadarko Petroleum Corp, owned by Occidental Petroleum Corp., BP and Royal Dutch Shell were also among the top five bidders.

Anadarko placed the highest single bid — more than $10 million — for a tract in the deep water Alaminos Canyon.

The sale was the first opportunity to test the oil and gas industry’s demand for Gulf acreage with energy prices at multi-year highs. U.S. crude futures on Tuesday settled at $80.76 a barrel, up 95% in the last 12 months.

Despite the court-ordered resumption of auctions, Interior spokesperson Melissa Schwartz said the agency was “conducting a more comprehensive analysis of greenhouse gas impacts from potential oil and gas lease sales than ever before.”

Environmental groups strongly opposed the sale and had called on Biden to cancel it over the last week.

(Reporting by Nichola Groom; additional reporting by Sebastien Malo in New York; Editing by Leslie Adler, David Gregorio and Aurora Ellis)

Two storms head for U.S. Gulf in rare hurricane season event

By Liz Hampton

(Reuters) – A pair of tropical cyclones forecast to become hurricanes early next week are headed for the U.S. Gulf Coast and will spin over the Gulf’s warm waters simultaneously, a rare weather event that could cause massive disruption as they make landfall.

The last time two cyclones entered the U.S. Gulf of Mexico was in 1959, according to meteorologists interviewed by Reuters, and there have only been a handful of other occasions when two storms entered the Gulf simultaneously. In 1933, a Category 3 hurricane and moderate tropical storm hit the U.S. Gulf of Mexico, but there haven’t been records of two hurricanes in the Gulf of Mexico at the same time.

Tropical Storm Laura and a separate tropical depression brewing near Honduras could make landfall as hurricanes next week in an area spanning Texas to the Florida Panhandle, according to the National Hurricane Center.

Meteorologists say there is still a lot of uncertainty around the systems and how they develop and move in coming days, particularly as they cross land.

Both storms currently look on track to remain separate, however, any interaction between the two could change their intensity or trajectory, said Dan Kottlowski of AccuWeather. It is unlikely they would combine, he added.

“More than likely one will become stronger, and inflict more vertical wind shear causing the other to weaken,” Kottlowski. “But if they stay of equal strengthen, then they will probably prevent each other from getting really strong.”

In some cases when storms interact, they can orbit each other and the speed of one cyclone could accelerate the other, part of something known as the “Fujiwhara effect,” said David Streit of Commodity Weather Group.

Tropical Storm Laura, which is currently east of the Antilles, was upgraded from a depression on Friday and currently has sustained winds of 45 miles per hour, according to the NHC. Laura is forecast to make landfall as a hurricane on Wednesday in an area spanning Louisiana to the Florida panhandle.

Tropical Depression 14, which would be named Marco if it strengthens, is on track to make landfall on Tuesday near the Texas and Louisiana border. It would arrive around the three-year anniversary of Hurricane Harvey, which dumped a record 50 inches of rain on parts of Houston in August 2017 and caused billions of dollars in damage.

“Tropical Depression 14 doesn’t look robust right now, but it looks to be in an environment conducive to strengthening,” said Phil Klotzbach, a research scientist at Colorado State University.

AccuWeather’s Kottlowski said that Tropical Depression 14 is likely to become the stronger storm as it is slated to pass over a relatively flat area of the Yucatan Peninsula before entering the warm waters of the Gulf of Mexico, where it can gain strength.

(Reporting by Liz Hampton; Editing by Simon Webb and Aurora Ellis)

Punishing Hurricane Michael bears down on Florida Panhandle

Hurricane Michael is seen in this National Oceanic and Atmospheric Administrations's Geostationary Operational Environmental Satlellite (NOAA GOES-East satellite) image in the Gulf of Mexico, October 9, 2018. Courtesy NOAA GOES-East/Handout via REUTERS

By Devika Krishna Kumar

TALLAHASSEE, Fla. (Reuters) – Hurricane Michael was still strengthening as it closed in on the Florida Panhandle on Wednesday with the threat of catastrophic surges of sea water and roof-shredding winds, and was expected to be the worst hurricane ever recorded in the region.

Michael caught many by surprise with its rapid intensification as it churned north over the Gulf of Mexico. Shortly after 11 a.m. ET (1500 GMT) it was carrying top winds of 150 miles per hour (241 km per hour), making it a very dangerous Category 4 storm on five-step Saffir-Simpson scale, the National Hurricane Center said.

Authorities told residents along the affected areas of Florida’s northwest coast that they had run out of time to evacuate and should hunker down.

The storm caused major disruption to oil and gas production in the U.S. Gulf of Mexico.

Michael’s core was forecast to make landfall on Wednesday afternoon on Florida’s Panhandle and could drive sea water levels as high as 14 feet (4.3 meters) above normal in some areas, the hurricane center said. The storm could still strengthen further before coming ashore, it said.

As the outer bands arrived, ocean water was already flooding parts of Port St. Joe.

Mayor Bo Patterson said about 2,500 of the town’s 3,500 people were still there, including about 100 in a beachside area who did not follow a mandatory evacuation order. The two bridges leading out of Port St. Joe were closed, meaning no one could get out now.

“People are finally getting it, that this is going to be pretty strong,” Patterson said. “This happened so quickly, we weren’t exactly prepared.”

Michael grew from a tropical storm to Category 4 hurricane in about 40 hours.

“This kind of sprung up for us quite quickly,” said Andrew Gillum, mayor of the state capital, Tallahassee, which lies about 25 miles (40 km) from the coast and was preparing for a battering.

“We honestly felt we might have a tropical system and weren’t sure where it would go and now we’re staring down the barrel of a Category 4 storm,” Gillum told CNN.

“Satellite images of Michael’s evolution on Tuesday night were, in a word, jaw-dropping,” wrote Bob Henson, a meteorologist with weather site Weather Underground.

People in coastal parts of 20 Florida counties had been told to leave their homes. Much of the area is rural and known for small tourist cities, beaches and wildlife reserves, as well as Tallahassee.

Waves crash along a pier as Hurricane Michael approaches Panama City Beach, Florida, U.S. October 9, 2018. REUTERS/Jonathan Bachman

Waves crash along a pier as Hurricane Michael approaches Panama City Beach, Florida, U.S. October 9, 2018. REUTERS/Jonathan Bachman

TOO LATE TO LEAVE

Governor Rick Scott said on Twitter on Wednesday morning that it was too late to evacuate the target zone and that people who had stayed should immediately seek refuge.

Hurricane center Director Ken Graham said on Facebook that Michael would be the worst storm in recorded history to hit the Panhandle.

“Going back through records to 1851 we can’t find another Cat 4 in this area, so this is unfortunately a historical and incredibly dangerous and life-threatening situation,” he said.

Nearly 40 percent of daily crude oil production and more than one-third of natural gas output was lost from offshore U.S. Gulf of Mexico wells on Wednesday because of platform evacuations and shut-ins caused by Michael.

The hurricane was about 60 miles (95 km) south-southwest of Panama City, Florida, and moving north-northeast at 14 mph (22 kph), the hurricane center said in its 11 a.m. ET advisory.

Apalachicola Mayor Van Johnson said his city, which could suffer some of the worst of the storm surge, was under mandatory evacuation orders.

“My greatest concern is that some people are just now starting to take this storm seriously and are evacuating,” he told CNN. “And I just hope the others that have not made that decision get out while the roads are still passable and before the bridges close.”

President Donald Trump declared a state of emergency for the entire state of Florida, freeing up federal assistance to supplement state and local disaster responses.

POWER CUTS START

Authorities warned of coming disruptions for those in Michael’s path. About 10,000 customers were already without power around midday.

The region should brace for “major infrastructure damage,” specifically to electricity distribution, wastewater treatment systems and transportation networks, Jeff Byard, associate administrator for the Federal Emergency Management Agency, told reporters on a conference call.

Many state offices, schools and universities in the area have been closed since Tuesday.

Helen Neal, 88, and her husband, J.W. Neal, 87, preferred to take their chances in a hotel rather than in their two-story beachfront house about a mile away in Panama City.

“We just finished renovating and updating,” she said. “We’re kind of nervous. God willing we’ll still have some place.”

About 2,500 National Guard troops were deployed to assist with evacuations and storm preparations, and more than 4,000 others were on standby. Some 17,000 utility restoration workers were also on call.

NHC Director Graham said Michael represented a “textbook case” of a hurricane system growing stronger as it drew near shore, in contrast to Hurricane Florence, which struck North Carolina last month after weakening in a slow, halting approach.

He said the storm would still have hurricane-force winds as it pushed through Florida into Georgia and tropical storm-force winds when it reaches the Carolinas, which are still reeling from post-Florence flooding. Up to a foot (30 cm) of rainfall was forecast for some areas.

Scott, a Republican running for the U.S. Senate in November’s congressional elections, declared a state of emergency in 35 Florida counties.

Georgia Governor Nathan Deal declared a state of emergency on Tuesday for 92 counties in his state and a state of emergency also was announced in North Carolina.

The last major hurricane, a storm of Category 3 or above, to hit the Panhandle was Dennis in 2005, according to hurricane center data.

(Reporting by Devika Krishna Kumar in Tallahassee, Florida; additional reporting by Rod Nickel in Panama City, Florida, Susan Heavey and Roberta Rampton in Washington, Gina Cherelus and Barbara Goldberg in New York, Brendan O’Brien in Milwaukee, Liz Hampton in Houston, Andrew Hay in New Mexico; Writing by Lisa Shumaker and Bill Trott; Editing by Frances Kerry)