Petrobras gets permit for U.S. deep waters

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WASHINGTON, March 18 (UPI) -- Washington has given Petrobras America Inc. permission to start oil and gas production in the Gulf of Mexico, a regulator said.

The Bureau of Ocean Energy Management, Regulation and Enforcement gave Petrobras approval to use a floating production storage offloading facility at its Cascade-Chinook project in the Gulf of Mexico.

The approval marks the first time FPSO technology will be used in U.S. waters of the Gulf of Mexico.

The oil and gas project is about 165 miles off the coast of Louisiana in 8,200 feet of water. The FPSO has a production capacity of 80,000 barrels of oil and 16 million cubic feet of natural gas per day.

The BOEMRE approved the production safety system permit and a supplemental deep-water operating plan from Petrobras. The regulatory agency said it was satisfied that operations would be safe from hurricanes and other natural disasters.

"These regulatory approvals pave the way for safe, new production of oil and gas resources in the Gulf of Mexico," BOEMRE Director Michael R. Bromwich said in a statement.

Noble Energy in early March was awarded a BOEMRE permit to drill in the Mississippi Canyon block about 70 miles south of the Louisiana coast.

The permit was for what the BOEMRE described as a bypass well meant to drill around a mechanical problem in the original hole.

Deep-water exploration is under scrutiny following the April oil spill in the Gulf of Mexico. The U.S. government lifted a moratorium on deep-water drilling in October, six months after the Deepwater Horizon oil rig caught fire and sank in the Gulf of Mexico.