Stories tagged with "insurance"

A belated response to CGES

Posted by Heading Out on September 6, 2006 - 10:57am
Topic: Supply/Production
Tags: cges, chevron, insurance, jack 2, mars, thunder horse [list all tags]

While I was gone Dave kindly replied to Dr Drollas' comments to my post regarding Depletion and the CGES. Since today was the day that Chevron announced the Jack prospect test result, it might be considered that this speaks more to his argument than mine. The well showed that from about 40% of the pay zone they were flowing 6,000 bd, and a second well to further define and appraise the field will be drilled next year.

Further within the considerable comment that has been provided on a number of stations was the comment that this is the "final frontier" for oil exploration. Actually it probably isn't. There are still some places further North that have not yet been fully explored, but it is getting very close to the limit of where we can afford to economically look. We are, by the geological definition of where oil is likely to be found, starting to run out of places to look for these large fields.

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Anyone for insurance?

Posted by Heading Out on March 14, 2006 - 8:03pm
Topic: Economics/Finance
Tags: fires, hurricanes, insurance, oil storm, rig, tornadoes [list all tags]

The stormy weather is coming early this year, and there has been very heavy damage across the MidWest from tornadoes that seem to have arrived a couple of months earlier than are normally expected.

With the high costs that arose last year from the impact of the hurricanes, and the other unseasonable weather impacts on the country, such as the current fires in Texas and Oklahoma brought about by the drought, the insurance industry has been starting to take a look at the levels of risk that it is now getting into.

Last year, based on info that came from the industry we posted about some of the problems that companies engaged in drilling in the GOMEX were starting to encounter in insuring their rigs. All of a sudden the condition of the rig and the level of storm that it could withstand was being considered against the likelihood of it encountering a storm of that or greater magnitude. The insurers were asking, at that time, for assurances that rigs could withstand the storms, in the form of models that would validate the design strengths that were being proposed.

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We've gone Greek

Posted by Heading Out on October 22, 2005 - 5:35pm
Topic: Miscellaneous
Tags: drilling rigs, gulf of mexico, hurricanes, insurance, peak oil, production platforms [list all tags]

Tropical Storm Alpha has now been identified by the National Hurricane Center
..ALPHA BECOMES THE TWENTY-SECOND NAMED STORM OF THE SEASON AND
BREAKS THE ALL-TIME RECORD FOR THE MOST ACTIVE SEASON ON RECORD...
While neither Wilma nor Alpha currently threaten immediate oil production it is a concern that if this level of activity prevails, then we could be moving into a significantly more serious condition.  If more hurricanes can be anticipated and the National Geographic, in their Katrina Special Edition shows how much hurricane intensity has increased over the past decade, compared with the one preceding it, then putting valuable investments in harm's way is not the path to easy insurance.  We have already heard from folks in the industry that this problem is arising.  Simply put owners must prove, with an acceptable computer model, that the platform/rig can withstand a storm of a given intensity.

This may well change the pattern of drilling in the GOMEX, and possibly elsewhere where hurricanes or typhoons can be anticipated.  It will therefore  act to delay production as this exercise is completed, and when needed structures are strengthened. So, first the insurance industry has to identify where it expects storms and at what intensity in what areas, and then the production industry has to prove that their structures can withstand those storms.  

I knew there was a reason why we were graduating all those lawyers.  Now if only we were graduating enough engineers to give credibility to all those models (grin).

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