Jack-up rig returning to Homer

• Council hears report from city manager on winter docking  schedule

By Naomi Klouda
Homer Tribune
The Buccaneer jack-up rig Endeavour Spirt of Independence likely will be docked at the Homer harbor again this winter, a boon not sealed yet but embraced by city officials.
City Manager Walt Wrede told the Homer City Council and the public that he is involved in talks with the jack-up rig’s owners about winter dockage.
He wrote a letter of approval to the Alaska Department of Fish and Game as part of Buccaneer’s permit application to winter over.
“This is in discussions again this year. I took from our discussions last year that the Homer Port is open for business,” Wrede said.
The Endeavour spent from late August 2012 to late May at the Homer Deep Water Dock while completing preparatory work on the rig to make it suitable for Alaska’s harsh environment and other safety requirements.
“Fish and Game did require a study by a third party that concluded there was no long term harm to the environment generally. I wrote a letter to Fish and Game supporting Buccaneer’s proposal – this is the safest place for it to be,” Wrede said.

File photo- The Endeavor jack-up rig is headed to the Cosmo Unit in May. It likely will then be back in Homer in November.

File photo-
The Endeavor jack-up rig is headed to the Cosmo Unit in May. It likely will then be back in Homer in November.

Last winter’s lesson on Shell Oil’s rig Kuluk, a giant oil drilling platform used in Arctic drilling, illustrated what could happen if one of these top towering pieces of equipment get caught in heavy wind storms while traveling  to winter storage, Wrede said. In that case, hundreds of gallons of fuel spilled into sensitive waters off Sitkalidak Island, nearby Kodiak Island.
“They could tow it to Seward. Or they could put it at Port Graham, which would require a lot of daily support service. Maintaining the rig in safety is in the best interest of Lower Cook Inlet, and I think this is the best place for it to be,” Wrede said. “That’s the way (Harbormaster) Bryan (Hawkins) and I intend to proceed.”
The Endeavour reported a successful drilling season at both the nearby Cosmopolitan offshore Cook Inlet prospect and at the northern Cook Inlet’s Southern Cross natural gas wells, according to announcements this summer by CEO Curtis Burton. The company intends to supply natural gas to southcentral Alaska utilities.
“Cosmo has turned out to be substantially nicer than we had ever hoped for,” Burton said in a Sept. 10 conference with shareholders.
Buccaneer moved the Endeavour jack-up rig from the Cosmo No. 1’s work in early summer to its Southern Cross prospect in north Cook Inlet, then back to the Cosmo Unit where it is located now. Buccaneer is part-owner of the Endeavour rig along with Ezion Holdings of Singapore and the Alaska Industrial Development and Export Authority, the state development finance corporation.
The Coast Guard requires rigs to curtail their work during heavy ice pan conditions in the inlet, around Nov. 1.
“What I’ve heard is they plan to come out of the inlet Nov. 1. There’s nothing for sure about their coming to Homer yet,” Harbormaster Hawkins said. “They’ve been making inquiries. The plan is to stay about four months.”
Wrede emphasized to the council that the rig isn’t going to be “stored” at the dock. That implies it’s just sitting there. In fact, crews will be working on the rig in ways similar to last year, which added to Homer’s economy.
“This is for maintenance and repair – ours is a working dock, not a storage yard. We don’t want to impede commerce just because someone is parked there,” he said.
The arrangement proved lucrative to the City of Homer and the Homer Port and Harbor. Last spring the city transferred revenues generated above what it budgeted. Buccaneer’s dockage fees of  $577,000 was deposited into the Port and Harbor Reserves. More revenue flowed in this summer that has not yet been calculated for tugs’ supply wharfage and dockage. The City of Homer collected  the  rig’s property taxes of $181,087, now set aside as savings for rainy day use. Another $9,054 went to the Homer Foundation for investment, which supplies funds for the city’s nonprofits.
“The business was brisk all winter long. It wouldn’t have been as brisk without the jack up rig,” Hawkins said.
Lessons learned last winter will be taken into this next season, Hawkins said.
“We have no illusion that the rig can stay at the dock in any other configurations other than with the legs down. That is something we learned last  year. When winds started coming up ,we had no choice but to put the legs down,” Hawkins said.
The 40-story high rig lowered the legs at least 18 feet, and often more during big tides, for stability throughout the stay. A Kachemak Bay Critical Habitat Plan explicitly forbids setting jack up rigs’ legs down in the critical habitat, though there was some debate about whether the harbor itself is part of the critical habitat area.
“The main take away for us is the environmental assessment of having the legs down. The results is that there was no lasting environmental impact,” Hawkins said, referring to a study completed when Buccaneer hired URS Environmental Consultants for an independent study that was completed by Dave Erikson.
The city will learn more about a possible winter docking lease in the weeks ahead as Fish and Game considers permitting.

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Posted by on Sep 25th, 2013 and filed under Headline News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

4 Responses for “Jack-up rig returning to Homer”

  1. they violated the law says:

    Buccaneer has been the worst visitor ever. They broke the law putting their feet down in Kachemak Bay, a law that we had for a reason!.

    They lied about how long they were staying.

    They didn’t pay local workers, then blamed the victims who now have to take them to court to get payment.

    They have conducted seismic testing without a permit and been found in violation of the Clean Water act.

    Now they have farmed out the west eagle project to another company, are past the deadline on their leases, have not paid for their leases, have not received permission from the current lease holders Jim and Candy Van Oss…and yet they still plan on drilling and dumping their fracking waste at the headwaters of many of our fisheries.

    Where is the protection for people who live here?

    When did we as a community decide that this jack up rig would be a permanent fixture in our pristine view?

    Who really believes the city council cares about the environment with their plastic bag ban when they allow a company like this, who has already violated the clean water act, who has encroached on the protected critical habitat in Kachemak Bay, who couldn’t care less about the local community as they take our water for their drilling operations, destroy our roads moving their rig, dump their fracking waste in our watershed… and they even got the city council to make citizens pay for the gas lines so they can export their gas out of our bay.

  2. fire walt wrede says:

    Why is walt Wrede making decisions for our community on his own?

    Just because you are in a position of power doesn’t mean you get to violate the law.

    “A Kachemak Bay Critical Habitat Plan explicitly forbids setting jack up rigs’ legs down in the critical habitat”

    ““We have no illusion that the rig can stay at the dock in any other configurations other than with the legs down.”

    Just because you got away with violating the law once, doesn’t mean you can keep doing it. This isn’t Wall Street. This is what happens when you don’t hold people accountable, they just keep going.

    The money from Buccanner went to the harbor
    $577,000 was deposited into the Port and Harbor Reserves.

    and Walt Wrede’s rainy day fund
    City of Homer collected the rig’s property taxes of $181,087,
    now set aside as savings for rainy day use.

    so there appears to be a conflict of interest here.

    The community has to put up with this in our view, but they never once considered giving the money to the community for some of our requests such as a bike path on Kachemak drive, a Rec Center, a Teen Center…and we don’t even have a Boys and Girls club anymore WTF ‘progressive’ Homer!

    Fire Walt Wrede and recall the city council, enough is enough!

  3. Glad to have them back says:

    They paid us a lot of money to stay for a while. Waitresses and other service industry folks that don’t make as much money in the winter are happy to take the employees tips. Restaurants, bars, cabs, retailers all make more money here when they are there. Plus the additional revenue from sales taxes on the stuff they buy. There is no downside. How the tax/rental money is spent is another issue. If you want it all to go to charity, go out today and vote for someone who feels the way you do, but you have to have money to spend it.

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