Offshore Oil Drilling after Deepwater Horizon Oil Spill — No New Safeguards, GOP Push for Less Oversight

One of the worst environmental disasters in history struck one year ago today — the “Deepwater Horizon oil spill,” or “BP oil spill.” Haven’t kept up with the details of offshore oil drilling much lately and curious where things stand? Well, I can’t say that we’ve learned from our lesson.

While no legislation has been passed to make offshore oil drilling safer, “the House Natural Resources Committee pushed forward three bills to expand offshore drilling and reduce safeguards,” Frances  Beinecke of the Natrual Resource Defense Council (NRDC), who served on the National Commission on the Deepwater Horizon Oil Spill and Offshore Drilling, writes.

Seriously, let’s make it easier to have another oil spill catastrophe? This is what the “House Natural Resources Committee” wants? Yes, the U.S. has been hijacked by political extremists who don’t understand the government’s role in ensuring a safe and livable environment.
More from Beinecke:

These bills would allow big oil companies to sidestep proper environmental analysis, rush permits and drill virtually anywhere off the U.S. coastline.

Have we learned nothing from the largest peacetime oil spill in history? Eleven men died in that disaster. More than 170 million gallons of Louisiana crude spewed into the water, and 1,053 miles of shoreline got oiled.

The impacts have been devastating. Gulf Coast fishermen lost $62 million in dockside sales because of the spill, while tourist businesses lost $1.5 billion in earnings. Oil remains in marshes and underwater plumes, and it will take years to determine the ecological damage.

Yet, it’s more important that oil companies be left alone to do what they wish wherever they wish.
The National Commission on the Deepwater Horizon Oil Spill and Offshore Drilling that Beinecke found, after an “exhaustive review of the evidence” that “the root cause of the spill was systemic failure in industry management and government oversight.” Of course it was.

Completely ridiculous that these supposed leaders of our country are interested in ignoring the findings, the need for change, and are actually pushing for further deregulation in this dangerous arena.

Will less regulation of offshore oil drilling help the U.S. become more energy independent? Not enough that anyone would even notice. This is one of the least effective ways of pushing for energy independence and doesn’t get at the root of our problem at all. My grandfather was the Chief Excavation Geologist for Exxon for the U.S. (not including Alaska or California) before he retired — the guy in charge of finding oil. He mentioned a couple years ago that we’ve just gotten spoiled, that we don’t have the oil available to support our current demand.

Here’s more on that from Beinecke as well.

Turning back the clock on offshore drilling will do little to relieve America’s oil addiction.
According to the Department of Energy’s Energy Information Administration, drilling in America’s previously closed ocean areas “would not have a significant impact on domestic crude oil and natural gas production…before 2030.” Even then, “because oil prices are determined on the international market …any impact on average wellhead prices is expected to be insignificant.

The U.S. cannot drill its way out of oil dependence. We can, however, turn to a host of clean energy solutions that could cut our oil imports almost in half in just 14 years. We don’t have to wait for technological breakthroughs to get started. Things like cleaner cars, more transportation options, high speed rail, and sustainable, homegrown fuels already exist.

Seriously, this is the route we need to go down. We don’t live in caves any more. We found a better option. We can find a better option for our energy supply as well (we already have). Increasing the risk of workers, the environment, and the whole world in order to try to live on an energy source of the past makes no sense (unless you are a Congressman bought by an oil industry trying to increase its profits for a few more years and don’t have any concern for what’s actually best for the American people).

A $20 Million Reward for Failure

Published by Andy Rowell July 26th, 2010 

The details are still being worked out. The BP Board meets this afternoon.

But if the press reports are anything to go by, the company’s embattled CEO, Tony Hayward will walk away with anything from at least £11 million to £12 million plus. That’s about $18.5 million.

And that’s the low estimate. The huge amount is likely to add insult to injury to many American politicians, who see Hayward’s gaffe-prone response to the oil spill as an outrage.
Many of these gaffe’s have been detailed on this blog like this quip that the environmental impact would be “very, very modest” and “I want my life back”.

Of course, Hayward did not personally cause the accident, but it happened on his watch. This is the man who was supposedly meant to bring safety to the fore on that watch.

This is man who came in after the dark chaotic days of Lord Browne whose own tenure oversaw the Texas refinery fire and spills on the North Slope.

Hayward’s ship was meant to be one of “silent runnings” but it ended in a loud and very public ecological and human disaster.
And in that sense, many people will see Hayward’s golden handshake and pension pot as a reward for failure.

It will certainly outrage many in America further – especially the businesses across the Gulf that are struggling to pay the bills, and keep their businesses afloat.

But BP will try and appease that anger by appointing  the company’s first no-British CEO, Bob Dudley.
Dudley grew up in Mississippi and so the fact that the disaster happened in his backyard is meant to be some kind of comfort to an American public desperate for the disaster to end.

The move also reflects how important America is to BP:  About one-third of the company’s oil and gas wells, refineries and other business interests are in the US,  and 40 percent of its shareholders are Americans.
But this disaster will impact BP and the region for years to come. The company’s finances are not going to look pretty. BP is forecast to unveil the worst quarterly loss in British corporate history tomorrow, which could rise to $25 billion.

And as the NYT says: “The move would also be a recognition by the board that even though the oil has stopped spewing into the gulf, dealing with the consequences of the Deepwater Horizon accident — from tens of billions of dollars in claims to possible criminal charges and new regulations on offshore drilling — is likely to dominate the company’s agenda for years.”

But American shareholders may no longer be investing in “BP”. One thing being mooted is that the company changes the name of its American operations back to Amoco, the company Dudley once headed.
Changing your name is a tried and tested response to disasters.

Remembered how Exxon renamed the Exxon Valdez to the Exxon Mediterranean.  But that was just one tanker, this is a whole company…

The Burning and Sinking of the Deepwater Horizon Oil Rig

Yesterday, we blogged about photographs of the Gulf of Mexico oil spill hitting the Louisiana shorelines and undoubtedly you’ve heard about Big Oil pointing fingers and casting blames at each other about whose fault it was.

But what happened when the Deepwater Horizon oil rig exploded? National Geographic Channel has the exclusive, never-before-seen photographs and video footage of the rig ablaze and the efforts of the US Coast Guards and first responders to put out the flame and rescue the survivors.

Over at Neatorama Spotlight, we have a few photos of the sinking rig that will leave you breathless: Link – Thanks Julie Frazier and Minjae Ormes!

Dragons Attacking Gulf Coast Beaches are a Bigger Menace Than the Oil Spill

by Chip Merlin

The Destin beach’s white sugar sand was in full glory yesterday. While flying back to Tampa and looking down on the crystal blue water and the most gorgeous stretch of beach in the United States, I told Corey Harris that such beauty and fun is being wasted because of fear caused by the oil spill. A funny YouTube video about the current threat of oil and dragons makes the point:



The economy along the northern Gulf Coast is being destroyed because of unnecessary tourist cancellations and vacation plan changes. The truth is that the BP Oil Spill has not physically impacted the islands or beaches in Florida. Instead, the media coverage caused by the spill is impacting the Gulf Coast economy. Florida's leaders from Miami-Dade and Broward County may want to consider this the next time they place themselves in the media to show concern about the crisis. They may want to make their preparations in a more quiet way or damn the people they are trying to help.

The condominium shown in the video, Edgewater Beach Condominium, is a lead client of ours in the class action lawsuit we have filed. We have added a distinguished class action attorney, Adam Moskowitz, and his firm, Kozyak Tropin and Throckmorton, to the team of lawyers with the notable Florida panhandle firm of Keefe, Anchors Gordon & Moyle. On Friday, we amended the class action complaint and also filed an emergency motion for injunctive relief.

The other condominium shown in the video is one of a number of individual commercial clients we represent that have been economically damaged by the oil spill. The recurrent property insurance coverage question people are asking is 'what happens if a hurricane pelts my property with oil?' My first response is that people should not worry about perils that may never occur, except to have the most broad coverage they can obtain. Second, I am not certain whether the scenario will happen, because the oil probably would not fly into a structure, but only get carried in the water as part of the storm surge. I anticipate that many carriers would claim that the cause of the loss would be flood rather than wind, and we would be in the same wind versus water quagmire that plagues us in so many other hurricane events. We can speculate on those coverage issues later. My suggestion today is to buy flood insurance now.

In the meantime, visit and enjoy the sun and water along Florida's beaches. We'll take care of the dragons.

Is 70,000 barrels a day a possibility for the oil spill?

Posted by Gail the Actuary

NPR is now reporting that the oil spill could be 70,000 barrels of oil a day, which is considerably greater than the estimate of 5,000 barrels per day currently being reported. What is the view of Oil Drum readers regarding the likelihood of the higher estimate being accurate? According to the story:

The analysis was conducted by Steve Werely, an associate professor at Purdue University, using a technique called particle image velocimetry. Harris tells Michele Norris that the method is accurate to a degree of plus or minus 20 percent. That means the flow could range between 56,000 barrels a day and 84,000 barrels a day.

Another analysis by Eugene Chiang, a professor of astrophysics at the University of California, Berkeley, calculated the rate of flow to be between 20,000 barrels a day and 100,000 barrels a day.

We also know that the oil tends to mix with water to produce a "chocolate mousse" mixture. The controlled flow rates of wells drilled by BP's at its Thunder Horse platform (another deep water platform) seemed to produce oil of 40,000 to 50,000 barrels a day, when the wells were in maximum production based on the graphs below from this post:



Thunder Horse Main - Oil Production by Well, in Thousand Barrels per Day, based on data of Minerals Management Services


Thunder Horse North - Oil Production by Well, in Thousand Barrels per Day, based on data of Minerals Management Services

Natural gas production is in addition to the oil production shown on these graphs, bringing the barrel of oil equivalents up somewhat (10% - 15%) from this level. This Deepwater Horizon well is different, so this may not have particular relevance.

What are readers views on the likelihood of higher oil spill estimate being correct?