Allan G. Pulsipher

Rigs-to-Reef Programs in the Gulf of Mexico

Abstract The Louisiana and Texas Artificial Reef Programs are the largest rigs-to-reef programs in the world. The program involves donating obsolete oil and gas structures for use as artificial reefs in lieu of on-shore removal. The National Fishing Enhancement Act of 1984 established the U.S. National Artificial Reef Plan and provided guidelines for state development of artificial reef programs. In 1986, the Louisiana Artificial Reef Program was established and has accepted over 120 decommissioned platforms to create 83 artificial reef sites in the Gulf of Mexico. The Texas Artificial Reef Program, established in 1991, has created over 35 reef sites from 73 platforms. The purpose of this article is to describe the Louisiana and Texas Artificial Reef Programs, to compare their regulatory structures, and to discuss the nature of the cost savings associated with reef donation and the frequency of donation.

Sources of change in petroleum drilling productivity in onshore Louisiana in the US, 1977–1994

Abstract Productivity of petroleum exploration and development drilling in the contiguous US has increased over the last 15 years, thereby suggesting that the effects of some other factors may be offsetting the expected negative effect of resource depletion. In this paper, we disentangle empirically, using a region-specific petroleum drilling and discovery model, the effects of resource depletion and other intervening factors on petroleum reserve additions in a typical mature petroleum basin in the US — Louisiana onshore basin. Our empirical results confirm the expectation of diminishing marginal returns to exploration and development drilling with increasing drilling effort. The results also indicate that while technical progress significantly reduced the negative effects of depletion on petroleum reserve additions by as much as 7.5% in north Louisiana and 6.7% in south Louisiana, its overall impact on reserve additions has not dominated the effects of depletion in Louisiana state jurisdiction.

Onshore disposition of offshore oil and gas platforms : Western politics and international standards

Abstract Onshore-only disposition of retired offshore oil and gas platforms has become a core strategic objective for ocean/environmental advocates and policy makers. Although international oil companies oppose an onshore-only requirement, its rejection is no longer a high priority for them. The ascendancy of onshore-only disposition reflects a rational and predictable response to political attitudes, values, and expectations in Western Europe by both governmental policy makers and petroleum industry strategists. Repercussions from the fight over the disposition of the obsolete Brent Spar offshore oil storage and transfer facility are the proximate cause of the shift. Onshore disposition has been least expensive option for most platforms, but as platforms move further from shore toward deeper waters onshore disposition is more frequently inferior to other disposition alternatives — from both an environmental and economic point of view. If onshore-only disposition were to become an international standard, either de facto or de jure, some offshore producing areas would incur significantly higher disposition costs and lose opportunities to better utilize and protect their marine resources.

Estimating the Economic Benefits of Regional Ocean Observing Systems

This article introduces a theme issue of the Coastal Management Journal comprising a set of articles on the potential economic benefits from new investments in coastal ocean observing systems. We describe a methodology to estimate these benefits, and apply this methodology to generate preliminary estimates of such benefits. The approach focuses on coastal ocean observing information within ten geographic regions encompassing all coastal waters of the United States, and within a wide range of industrial and recreational activities including recreational fishing and boating, beach recreation, maritime transportation, search and rescue operations, spill response, marine hazards prediction, offshore energy, power generation, and commercial fishing. Our findings suggest that annual benefits to users are likely to run in the multiple

The cost of explosive severance operations in the Gulf of Mexico

100s of millions of dollars. The project results should be considered first-order estimates that are subject to considerable refinement as the parameters of regional observing systems are better defined, and as our understanding of user sectors improves.

Explosive removals of offshore structures in the Gulf of Mexico

Abstract The cost of explosive severance operations associated with decommissioning offshore structures is estimated based on 139 service jobs performed by DEMEX Division, TEI Construction Services, Inc., over a 4-year period in the Gulf of Mexico, 1999–2002. There are no published reports or systematic analysis of the cost of explosive cutting and so this analysis should serve as a useful industry baseline. The elements of a standard contract are presented and the total cost of the operation is derived in terms of the parameters of the contract. The percentage contribution of the fixed cost of service to the total cost is then estimated based on an assessment of average contract parameters. The total cost to perform an explosive severance operation is aggregated according to job type and normalized according to the number, size, and length of cut performed. Descriptive statistics are provided and relations are derived that estimate the time and cost of cutting based on various descriptor variables. The expected size and potential value of the explosive severance market in the Gulf of Mexico is also estimated. A major conclusion of the analysis is that explosive severance is a time-invariant structure-dependent operation and this combination of time invariance and structure dependence is one of the primary reasons for the popularity of explosive severance. Contractors essentially know the cost of an explosive severance operation before performing the job and this certainty of operation is an extremely valuable characteristic from an operational and financial perspective.

The potential economic and environmental impact of a Public Benefit Fund in Louisiana

A statistical description of the explosive removal of offshore structures in the federally regulated Outer Continental Shelf of the Gulf of Mexico are presented based on data collected by the US Minerals Management Service. The influence of factors such as water depth, planning area, configuration type, and structure age upon the application of explosive removal methods are investigated. The number of structures expected to be removed from the Gulf of Mexico using explosive methods is also forecast over a short-term time horizon according to structure, configuration type, water depth, and a planning area categorization.

Concerns Over the Allocation Methods Employed in the US Low-Income Home Energy Assistance Program

Abstract Public Benefit Fund programs are one approach to provide energy assistance to low-income households placed at risk in a competitive electric industry. The purpose of this paper is to assess the potential economic and environmental impact of a proposed Public Benefit Fund for the state of Louisiana. The “best available” model to estimate the relationship between the cost of Public Benefit Fund programs and the benefits delivered by its implementation would be based on an evaluation of existent energy conservation and weatherization programs in the state, but unfortunately, such an evaluation has not been previously performed and so the “next best” analytic model was employed. The impact of a Public Benefit Fund on energy savings and environmental consequences is assessed through a simulation model and input–output analysis. The model developed is based on publicly available data and infer results under a reasonable assumption set. The model structure and system assumptions of the Public Benefit Fund program are described, realistic policy alternatives are examined—including cost-ceiling, variable funding, and target group strategies—and the limitations of the analysis are outlined.

A binary choice severance selection model for the removal of offshore structures in the Gulf of Mexico

The Low-Income Home Energy Assistance Program (LIHEAP) is the largest federal energy assistance program in the United States and forms an important component of the social safety net for low-income households. The manner in which LIHEAP funds are allocated to states has been a contentious issue since the inception of the program. The distribution of funds among states is not proportionate to the need for assistance based on commonly accepted standards of fairness, with states in the Northeast and Midwest receiving more, and states in the South and West, less than they should. We derived and evaluated the formula by which states receive LIHEAP funding, and we found that unanticipated circumstances, not congressional intent, have perpetuated an inequitable distribution. In 1984, Congress corrected the formula it had hastily enacted in 1981 using a rational and equitable allocation system. It also added provisions, however, that prevented the improved system from being activated. As Congress considers future reauthorizations of LIHEAP, it has three options: to fully implement the intent of the 1984 reform of the program; to acknowledge that LIHEAP is primarily a heating-assistance program and adopt a heating-only formula to distribute LIHEAP funding; or to significantly increase LIHEAP funding. The history of LIHEAP appropriations does not imply that the reforms incorporated in the 1984 legislation should be thwarted; it implies that Congress should remove or reduce the legislative provisions that have produced the unintended result. Congress can fully implement the 1984 reform by removing the trigger appropriation or reducing the threshold to

A generalized modeling framework for public benefit fund program valuation

1 billion or less.