Statoil (STO) 6th to Receive Gulf Drilling Permit Since BP (BP) Spill

Under enormous pressure because of dragging its feet for months on getting drilling in the Gulf of Mexico going again, the Obama administration is starting to finally award permits, with the latest being to Statoil (NYSE:STO), the sixth new Gulf drilling permit handed out since the BP (NYSE:BP) oil spill, according to the U.S. Bureau of Ocean Energy.

Statoil's permit authorizes a new well to be drilled in Alaminos Canyon Block 810 in water 7,134 feet deep, about 216 miles off the Texas coast south of Texas City.

BOEM Director Michael Bromwich said, "This permit is the sixth we have approved since Feb. 17, when industry demonstrated it had the capacity to handle subsea blowouts and spills."

"Some say we are now proceeding too quickly; some say we are still proceeding too slowly. The truth is we are proceeding as quickly as our resources allow to approve permit applications that satisfy our rigorous safety and environmental standards."

In other words, the crisis in the Middle East underscores the need to drill for oil, and that more than anything else, is the reason the government is finally moving.

The rising price of oil and gasoline is the motivator behind all this, and it's more obvious that's the case because of the sudden drilling religion the Obama administration got.

If they had done the right thing and got the permitting process going quicker, the administration wouldn't be criticized for how allegedly "quickly" they're now issuing permits.

Statoil closed in New York Friday at $27.57, down $0.39, or 1.39 percent.

Exxon (XOM) Resuming Gulf Drilling within weeks

ExxonMobil announced a couple of days after receiving a permit to drill in the deep waters of the Gulf of Mexico that it will begin drilling there in a few short weeks.

ExxonMobil spokeswoman Margaret Ross said, "We have a newly built, state-of-the-art drilling rig standing by and we are prepared to spud the well within a few weeks."

On Tuesday, the US Bureau of Ocean Energy Management, Regulation and Enforcement granted a permit to ExxonMobil to drill a well in the Keathley Canyon Block 919 in 6,941 feet of water, about 240 miles off the coast of Louisiana. It was the fourth of five deepwater permits issued by BOEM since the moratorium was lifted in October.

A spokeswoman for Danish rig owner Maersk said the company had already begun drilling the deepwater exploration well and predicted the job would take five to six months to complete.

But Ross said only staging operations had resumed.

Exxon closed Thursday at $82.73, gaining $0.13, or 0.16 percent.




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BP (NYSE:BP) Stops Work on Alaska's Liberty Oil Project

Citing a number of problem which have arisen in relationship to their work on developing the Liberty oil field, BP (NYSE:BP) has suspended work for now, saying the will launch a broad engineering review of the huge drilling rig before proceeding with the development.

According to BP, a number of issues have arisen during the constructing of the drilling rig, which is being assembled on a man-made island in the area.

BP spokesman Steve Rinehart said, “We’ve gotten to the point that we need to step back, take a time out and make sure that all of these systems, including some critical safety systems, are just like they need to be.”

“It’s a really important project ... it has to be done right,” added Rinehart.

Among the systems to be scrutinized by engineers will be safety and ventilation systems, power systems and mud control.

At peak production Liberty is expected to produce about 40,000 barrels of oil a day.

Transocean (NYSE:RIG): Lawsuit Settlement, We're Not Paying

To add insult to injury, Transocean (NYSE:RIG) is saying they're not paying any lawsuit settlement. Victims and their families are suing Transocean and BP. There were a total of 11 deaths due to the explosion of the Deepwater Horizon rig on April 20th. As well as another 17 people injured.

Transocean is the company that owns the drilling rig. The company has invoked an American 19th century law that will limit their financial liability to only $26.76 million. This amount totals only a small amount of what would actually be requested. Just three weeks after the massive explosion, Transocean petitioned a U.S. federal court for protection under the Limitation of Liability Act of 1851.

Martin Davis, director and professor of law at the Tulane University Maritime Law Center said, "it may work, they've got a chance." The Deepwater Horizon rig is technically considered a mobile offshore drilling unit, meaning it is classified as a seagoing vessel the same as a passenger ship or freighter, according to maritime law.