Gulf Horizon Accident Shows How Unprepared Everyone Was

November 2010 Vol. 237 No. 11

Carol Freedenthal, Contributing Editor

“Be Prepared!” Good motto for Boy Scouts and everyone else! On April 20, the BP Deepwater Horizon offshore rig caught fire. Eleven workers were killed, the rig in a few days was lost and the greatest environmental disaster to date was started. Now, roughly six months later, there are still many questions yet to be answered. What can we say about the calamity?

No one in the long chain from well operator, rig operator to company management to government from the Coast Guard to the very top, the president – was prepared for such an enormous tragedy! Easy now to pick blame – point a finger here and there – but the whole system failed from the start of the accident and through most of the period until the broken well’s flow was stopped. Time and a number of special inquiries, commissions and the courts may one day identify the real cause of the accident. One thing is obvious: no one was prepared – Boy Scout or not.

Another old saying is, “the first casualty of war is the truth”! The Gulf accident shares this same distinction for many reasons. Natural gas and oil production are not a favorite among many people in the country who have deep convictions that hydrocarbon drilling and production are “dirty, polluting, and dangerous” businesses and using fossil fuels is outright horrible for the same reasons.

Just prior to the accident, the administration lifted the ban on offshore drilling to a limited extent. The need for oil and gas to feed the country’s energy appetite and to ease dependence on foreign supply – especially of crude oil – prompted a limited opening. Then the accident and bam – now we really have to stop all that deepwater offshore drilling! “No-drill” advocates now had their example of the worst that possibly could happen.

Between the advocates to “drill baby, drill” and those who say “no”, this leaves room to speculate on what led to the accident and steps to minimize the damages. With a media that loves to add a little fuel to the fire – best way to sell papers and get viewers – the stories were wild and rampant on what did happen, what was the cause, who was in charge, who was responsible, etc. A little preparation – be prepared – could have saved many wild rumors and fears.

Reading the headlines in May through the July’s first effective sealing of the well and cutting off the oil flow brought many extremes to the public’s attention. Some of the wilder ones suggested that crude from the well would get into the Gulf Stream’s loop current, come around the tip of Florida and go straight up the Northeast to damage New York beaches and higher up the coast. It could even do it by the end of June.

And once it got that far, “there is no stopping the oil from affecting the Atlantic Ocean and reaching the shores of Northern Europe”! Never happened – never came around into the Atlantic! Some other “Chicken Little” claims were that oil in the water would make the Gulf sterile and all fish and wildlife would become extinct. Yes – sadly some birds and other wildlife were severely affected but so far, no massive killings have been reported.

Financial harm would be devastating even though BP set up a $20 billion fund and took full responsibility for the cleanup. Its associates in drilling and finalizing the well, Transocean, the drilling operator and Halliburton, the well cement provider, might in the end share with BP the blame and liability. The very worst was the most discussed, the most cried about. But so far – nothing is seen to compare to the shouting.

The poor communications coming from poor preparation hurt the recovery in many ways. First, remember that drilling in 5,000 feet of water is neither easy nor without severe consequences if an accident occurs. Biggest difference is the difficulty of threading a needle a mile away vs. one in your hand. Encountering a difficulty like a burning rig in the middle of a wide open sea does present a whole new set of problems never seen or dealt with previously.

Whether the rig operator or its client, BP, had failed in the design, engineering and operations will be argued in many forums including courts in Houston or New Orleans. What happened after the explosion and the fire started is open to discussion as well. Did the operator respond properly? Did the Coast Guard, which was in charge of fighting the rig fire, respond correctly even to its own protocol? Or did it contribute to the collapse of the rig? Were the attempts to stop the flowing oil from the sea’s bottom the best possible ways to go?

Did the administration do the right thing in not allowing foreign boats with additional oil-skimming equipment to help immediately instead of late in the course of shutting in the well? Was the government right to impose a moratorium on Gulf drilling activities even though a court more than once said no? The shutdown affected more than just the Gulf as it impacted drilling in Alaska as well. The European Union (EU) just said no to a moratorium for its offshore activities. Again, time will tell.

Or will time tell? Will the advocates of “drill” or “no drill” be so strong that the truth is dead? The well’s flow was stopped July 15 and the well officially declared “dead” Sept. 19 when an intersecting well was used to cement in the Macondo. During the interval stories ranged from something to total disaster. Initially, the flow was estimated at various rates with 5,000 bpd the early guess by the government and industry watchers.

Was this the low end? Was 15-50,000 bpd more appropriate? Could it be as high as 100,000 bpd as some claim? Various groups are blaming everyone involved, including the government, of playing down the flow rate and minimizing the damage. The latest estimate is 53,000 bpd when the flow was stopped – somewhat higher than the normal range of 5-20,000 bpd for wells in the Gulf now. Latest estimate of the total released is 4.9 million barrels.

Another contention is how much oil is still out in the Gulf and how will it affect the environment and dependent businesses? In September, many authorities, including the government, estimated most of the oil, up to 60-80% of what was spilled, was no longer in Gulf waters. Yet other scientific sources are claiming tremendous pools of oil are on the Gulf bottom and much more is left to damage the environment.

While the Gulf catastrophe was bad – lives lost, billions of dollars lost – hardships on many for many reasons – it should not be used as an indictment for shutting down the oil and gas offshore operations. Offshore production brings many benefits. Yes, there can be a high price at times – so far this is the only U.S. drilling operation to go bad. The Gulf has seen 6,659 active and removed platforms and rigs with 819 still fully manned. The good they bring are immense.

Until new fuels are found – something we can all talk about but cannot guarantee when or how – fossil fuels are a necessity for maintaining the standard of living this country. For all the time, money and effort used in wind and solar energy production, it still is expected to produce less than 2% of U.S. energy needs for 2010.

A quick look at the benefits of offshore activities will give a better perspective to the importance of this production. In the country’s quest for additional energy supplies and the desire to be self-sufficient, the large valuable resources the Gulf offers are too good to be ignored. While there is not an accurate measure of the production from the broken well – be it 5,000 or 100,000 bpd is unknown – it was a large amount, meaning the formation is a good resource.

Looking at what federal offshore areas offer shows the importance. In 2007, the federal Outer Continental Shelf produced 27% of the total U.S. production of 1.8 billion barrels of crude oil and condensate. Natural gas production was 17.8% of 20.1 Tcf produced in the total U.S. State offshore areas are also important for their contributions. When storms threaten Gulf operations, the price of oil and gas quickly reflect these conditions.

Can the Gulf spill serve to crystallize the U.S. policy on energy? It brings to a head those so adamant against fossil fuels and those who see the need for such fuels until better – cleaner, safer, and economic – fuels are found and developed. U.S. energy policy through countless years has never grappled with the real issues.

If the U.S. really wants to be energy independent, the decision must be made to develop all fuels from all domestic locations. The Gulf is too valuable a supply region to be ignored.

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