“This Will Be The First Year Since 1958 Without an Offshore Federal Lease Sale” Featuring Erik Milito, NOIA

C.O.B. Tuesday

Today we were thrilled to welcome back Erik Milito, President of the National Ocean Industries Association (NOIA). Erik has served as President of NOIA since 2019 following 17 years in several leadership roles at the American Petroleum Institute and prior experience as an attorney in the Solicitor’s Office of the US Department of the Interior. Erik served on active duty in the US Army as a Judge Advocate from 1995 to 2000 and continued his service in the US Army Reserve from 2000 to 2004. NOIA’s mission is to advance and promote the interests of the offshore oil, gas, wind and ocean minerals industries. We last hosted Erik on COBT in April 2021 (episode linked here) and were excited to reconnect for an update on offshore activity.
In the discussion, Erik provides an overview of the NOIA’s role to promote favorable policies related to offshore leasing, permitting, and regulation covering all flavors of energy including oil and gas, wind, carbon capture and storage and minerals. We start the conversation with Erik reminding us of the importance of the Gulf of Mexico as a booming region for the country and then dig into the challenges of offshore wind as an emerging sector. We cover the fascinating contrast of lease sales in the current administration compared to historical numbers. As the episode title mentions, this will be the first year since 1958 without a single federal offshore lease sale. We touch on advances in technology as current operations explore deeper depths / higher pressures in recent years, and we dig into how Erik sees the offshore wind industry developing from the services standpoint over the next couple of years. We also cover the complex issues around insurance and decommissioning platforms. We move on to discuss the positive relationship with the fishing industry and the significant role that the coastal state governments play in the world of the NOIA. Erik shares his perspective on Washington DC, the current climate given the election, and his sense of the public’s mood and attitude towards the various sources of energy that the NOIA is involved in. We wrap up the discussion by getting Erik’s thoughts on the progress of carbon capture over the last few years and the slower pace of offshore versus onshore CO2 projects and he urges that more progress would be possible with the cooperation of the government around permitting and regulatory support. We end the discussion with the areas that Erik is most optimistic about for the NOIA’s membership which includes opportunities in the Gulf of Mexico.
It was a fantastic conversation. Thanks to Erik for joining us!
Mike Bradley opened the conversation by highlighting that trading in markets last week could be summed up briefly in two words: “volatility & reversal”. On the bond market, he highlighted that the 10-year bond yield was trading modestly lower due to a cooler-than-expected PPI. He also noted that this was a heavy economic reporting week with July CPI set to report on Wednesday and Initial Jobless Claims & Retail Sales on Thursday. On crude oil, he highlighted that WTI price was down ~$2/bbl. on Tuesday due to monthly reports from the IEA & OPEC showing minor 2024 demand reductions. He noted that despite these two demand datapoints that WTI still rebounded by ~$6/bbl. over the 5+ trading days due to improving technicals (WTI price back above its 50/100 day moving averages) and growing supply concerns (potential Iranian retaliation against Israel & Ukrainian incursion into Russia). He rounded out the conversation by highlighting that 3mo rolling forward copper prices have declined over the last 4-5 weeks (~$10.5k/MT down to ~$9k/MT) due to continued global demand concerns and elevated LME Copper inventories. He also noted that copper prices were getting bid up this week due to a workers s