Two years after BP oil spill, offshore drilling still poses risks

Two years after a blowout on BP’s Macondo well killed 11 men and triggered the largest oil spill in U.S. history, oil companies are again plying the waters of the Gulf of Mexico.

Forty-one deep-water rigs are in the gulf. The vast majority of them are drilling new holes or working over old ones, while the other behemoths are idle as they await work or repairs. A brand new rig — the South Korean-built Pacific Santa Ana, capable of drilling to a depth of 7.5 miles — is on its way to a Chevron well.

But three recent incidents in other parts of the world show just how risky and sensitive offshore drilling remains.

In the North Sea, French oil giant Total is still battling to regain control of a natural gas well that has been leaking for nearly four weeks. Meanwhile, Brazil has confiscated the passports of 11 Chevron employees and five employees of drilling contractor Transocean as they await trial on criminal charges related to an offshore oil spill there. And in December, about 40,000 barrels of crude oil leaked out of a five-year-old loading line between a floating storage vessel and an oil tanker in a Royal Dutch Shell field off the coast of Nigeria.

Many experts say that even with tougher regulations here in the United States, such incidents are inevitable.

“I’m not saying we shouldn’t do it [offshore drilling], but we ought to go at it with our eyes open,” said Roger Rufe, a retired Coast Guard vice admiral. “We can’t do it with a human-designed system and not expect that there will be occasional problems with it.”

Shell is one company particularly anxious to avoid the slightest whiff of trouble. It is on the verge of getting the final two permits needed to drill this summer in the Chukchi Sea, off Alaska’s Arctic Coast, a plan that has aroused opposition from a broad array of environmental groups.

So on April 10 when federal regulators told Shell that they had spotted a 1-by-10-mile oil sheen in the eight miles of water between two Shell production platforms in the Gulf of Mexico, executives acted quickly. They promptly mobilized an oil cleanup vessel and sent two remotely operated underwater vehicles to scour the sea floor. It turned out that the oil — only six barrels — came from a natural seep common in the gulf.

“Post-Macondo, there’s no such thing as a small spill,” said an executive from another big oil company, who asked for anonymity because he was not authorized to comment.

With the anniversary of the BP spill, many experts are reassessing U.S. progress since the accident. And environmentalists are assessing damages.

A National Wildlife Federation report said, for example, that the shrimp catch increased last year but that since the spill 523 dolphins have been stranded onshore, four times the historic average; 95 percent of them were dead. A team of scientists led by Peter Roopnarine of the California Academy of Sciences said oysters collected post-spill contain higher concentrations of heavy metals in their shells, gills and muscle tissue than those collected before the spill.

The members of the presidential Oil Spill Commission that investigated the BP spill said in a report that they were “encouraged” by reforms at the Interior Department, which oversees drilling in U.S. waters. But they said they are dismayed by the failure of Congress to enact some reforms into law, worried about the prospect of Arctic drilling, and concerned that the United States had not altered the embargo of Cuba to allow U.S. vessels to respond if there was a spill from a rig drilling in Cuban waters.

Environmental groups are more adamant. Oceana, a group opposed to offshore drilling, said “offshore drilling safety has not improved.”

That assertion was disputed by Michael R. Bromwich, who oversaw the overhaul of the Interior Department agency now divided into the Bureau of Safety and Environmental Enforcement and the Bureau of Ocean Enforcement and Management.

“Sometimes it takes a crisis to get changes,” Bromwich said at a recent conference. He said better regulation was built on three legs: prevention, containment and spill response. He hailed advances in the first two areas but conceded that the ability to scoop up spilled oil “has developed painfully little since the Exxon Valdez,” the infamous 1989 incident in which a drunken tanker captain ran his ship aground close to the Alaskan shore.

“Once oil is in the water, it’s a mess,” Rufe said, “and we have not demonstrated an ability to get up more than 3 to 5 percent of the oil spilled.”

Many major oil companies say that using better well designs and having on standby containment devices similar to those used to plug the BP well provide the surest ways to prevent future disasters.

Yet well design is a key issue in Chevron’s oil spill in Brazil. Experts say that excessive pressure from drilling mud in the well had forced oil into rock below the well’s steel casing and then into faults leading to the sea floor about 150 feet away. Underwater video showed a line of droplets oozing out.

Chevron expects a Brazilian regulator’s upcoming report to say that the casing should have been installed to a greater depth. But company spokesman Kurt Glaubitz said that deeper casing isn’t industry practice and that Chevron and other companies had used the same design in other wells in the field. Moreover, he said, the Brazilian regulator and Petrobras, the state oil firm that is Chevron's partner in the well, both signed off on the well design.

“Companies are going to draw the risk line in different places,” said John Amos, president of Sky Truth, a group that uses remote sensing and digital mapping to track environmental issues. “This is just another argument for strict oversight.”

Governments also need to decide where to draw the line. In addition to criminal charges against its employees, including Brazilian unit head George Buck, Chevron faces two $11 billion civil lawsuits. One is over the 2,400-barrel spill in November and the second is over a two-barrel leak in March. Chevron has shut down a field that had been producing 60,000 barrels a day.

“The public policy issue is: Will it threaten the whole Brazil program?” said Robin West, chairman of Washington consulting firm PFC Energy.

Brazil has an ambitious offshore drilling plan, which requires the investment and expertise of many international firms.

West said that Chevron was slow to respond to the first spill, in November and that it might have “over-pressured” the well. “But the notion that this is criminal wrongdoing struck me as preposterous,” he said. “Any company investing in Brazil has to wonder whether it’s prudent to be there.”

Steven Mufson covers energy and other financial news.
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